Supermarket sales decline for first time in two years

Sales fell 0.5% year on year for the 12 weeks ending 14 July 2019 as they failed to keep pace with a record summer last year, which was boosted by the men’s football World Cup and a prolonged period of good weather.

All the major grocers recorded a sales fall, with Morrisons recording the largest drop of the big four as sales fell 2.6% during the 12 weeks to 14 July.

Ocado was the standout performer during the period as it increased sales by 11.9% due to customers buying from the online grocer more frequently.

In contrast, shoppers visited the bricks-and-mortar grocers less frequently during the period, contributing to the sales decline.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: “The main factor behind the sales drop-off is shoppers heading out to stores less often. Last year people shopped more frequently and closer to home as they topped up the cupboards while enjoying the sunshine and the men’s football World Cup.

“This year households are making one fewer trip, which may not sound like much but is enough to tip the market into decline.”

Discounters Aldi and Lidl once again recorded strong sales growth as they opened more stores and invested heavily in marketing.

Lidl’s sales grew 7% and Aldi’s jumped 6.7%, helping it grab a record 8.1% share of the market.

Nielsen data for the period between April and the end of June found Aldi and Lidl spent the most on advertising, topping almost £12m each.

Overall TV and press advertising spend by the grocers increased 11.6% year on year to £72.76m, partly due to the late Easter campaigns in 2019.

Nielsen grocery sales figures for the last four weeks also recorded a 0.5% fall in sales. Data reveals shoppers spent less per visit compared with the same period last year.

Nielsen’s data shows that over the last 12 weeks sales fell at every major supermarket, with Marks & Spencer experiencing the largest decline after a 3.6% fall, followed by Morrisons’ sales declining 3.1% and Waitrose’s dropping 2.9%.

Mike Watkins, Nielsen’s UK head of retailer and business insight, said: “Data shows that some of the weakness in recent grocery spend is linked to the strong summer of 2018, where the warm weather peaked and consumer spirits were high on the events of the World Cup.

“This year, retailers have had to work harder to drive shoppers to spend, and the increase in press and TV advertising spend proves that retailers are looking at more creative ways to achieve this.”