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UK Food & Grocery Sector Report summary

April 2024

Period covered: Period covered: 25 February – 30 March 2024

3 minute read

 

Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.

 

Food & Grocery Sales

Food & Grocery sales rose xx% YoY in March, according to the Retail Economics Retail Sales Index (value, non-seasonally adjusted).

Key factors impacted this performance:

Early Easter: Food sales benefitted from Easter falling in March this year, rather than April, leading to positive comparisons to last March.

Lower Inflation: Easing food inflation, compared to double-digit price rises a year ago, is encouraging more frequent and larger grocery shopping trips, supporting a recovery in volume growth.

Hospitality bites back: After prioritising at-home meals and entertainment over winter, slightly warmer weather and special occasions like Mother’s Day, Easter and St Patrick’s Day enticed more consumers back to restaurants and bars in March. Like-for-like sales in hospitality venues rose xx% YoY in March (CGA-RSM).

 

 

Early easter boost

Food sales remained solid in March, buoyed by an Early Easter and strong supermarket promotions as retailers cut prices amid easing inflation.

Adjusting for inflation, food sales volumes edged up xx% YoY in March, against a xx% drop over the same period last year.

The return to positive volume growth over Q1 is significant, giving retailers and suppliers the opportunity to regrow margins that have shrunk during the cost-of-living crisis.

Food inflation slowed to xx% in March, down from xx% in February – marking the lowest annual rate since xxxx (ONS).

The run-up to Easter is a key part of the retail calendar for the Grocery market, as people look to indulge on seasonal treats and make the most of the celebrations over the long weekend.

The earlier timing of Easter this year meant Food spending was pulled forward to the end of March, from April when Easter usually falls.

Shoppers spent £xx more on Easter treats in the first three months of 2024 versus 2023, while volume sales of hot cross buns were up xx% YoY (Kantar).

However, sales of xxxx were reportedly impacted by high xxxx price inflation and new health regulations meaning promotional displays had to be less prominent in-store.

 

 

Retail media race

Most major grocers have been expanding their retail media offer as they vie to unlock new revenue streams and gain early mover advantage in a rapidly evolving market.

Grocery retailers offer advertisers a dream platform due to their extensive audience reach, frequent customer visits, and rich data collection capabilities.

Retail media gives brands the opportunity to target highly specific audiences, focusing at scale on the customers that matter most.

Morrisons has introduced digital screens at Market Street food counters in over 300 stores, while its More Card app has a new feature which uses AI to offer hyper-personalised shopping challenges. Customers can select up to 10 preferred brands and earn loyalty points by meeting spending targets.

Tesco has installed 2,000+ digital screens in-store, having assembled a dedicated retail media team of 400+ staff to strengthen partnerships with advertisers and suppliers.

 

 

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Tesco and Sainsbury’s battle back against discounters

Source: Kantar (green denotes market share gain, red denotes share loss)

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UK Food & Grocery Sector Report: July 2024

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  • Grocery Market Share - Top 10 UK Food retailers
  • Food & Grocery Market Size estimates (£m)
  • Sales Growth by category
  • Total Food Spending by category (£m)
  • Online Grocery Sales (y-o-y)
  • Forecasts for 2024 - 2028
  • Footfall by channel and region
  • Regional Weather data and more…