Grocery price inflation fell over the last month when shoppers snapped up promotions.
Grocery price inflation declined 1.6 percentage points to 14.9% in the four weeks to July 9, market monitor Kantar reported, as spending on promotions rose for the first time in two years to account for 25.2% of the market. Grocery sales increased 10.4% year on year during the period.
Kantar head of retail and consumer insight Fraser McKevitt said: “One of the biggest shifts we’ve seen in this area is retailers ramping up loyalty card deals like Tesco’s Clubcard Prices and Sainsbury’s Nectar Prices. This could signal a change in focus by the grocers who had been concentrating their efforts on everyday low pricing, particularly by offering more value own-label lines.
“The boost to promotional spending has contributed to bringing inflation down but this isn’t all that’s driving the change. Prices were rising quickly last summer so this latest slowdown is partially down to current figures being compared with higher rates one year ago.”
He added: “It’s clear that shoppers have dramatically changed their behaviour to combat inflation, whether by trading down to cheaper products or visiting different grocers. The average annual increase to household spending over the past 12 months has actually been £330 – well below the hypothetical £683.”
Sainsbury’s sales increased most among the big market leaders – up 10.7% to hold a market share of 14.9%. Asda and Tesco’s sales rose 10.5% and 10.2%, respectively, giving them market shares of 13.6% and 27%.
Aldi remained the fastest-growing grocer. Its sales rose 24% and it claimed a 10.2% market share. Lidl increased its market share 0.7 percentage points to 7.7% as its sales advanced 22.3%.
Morrisons growth of 2.5% was its best performance since April 2021 as it improved performance for an eighth consecutive month.
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