Total Till sales at UK supermarkets slowed (+5.3%) in the past four weeks ending 24 February, down from +6.6% in January, as a result of food inflation falling to 5%, new data reveals.
However, the data from NIQ shows grocery retailers capitalised on big events like Valentine’s Day, Pancake Day and the Chinese New Year to attract shoppers through promotional offerings. In the past four weeks, 24% of all FMCG sales were bought on promotion, rising to 35% for branded items, up from 31% a year ago. Sales of supermarket own-label goods also increased to 16% compared to 13% last year.
NIQ data also reveals that online channel growth (+7.9%), remains ahead of in-store (+3.8%) with the online’s market share up to 11.2% compared to 10.8% this time last year. However, despite February being the warmest and wettest on record in the UK, NIQ data shows shoppers increased their in-store visits (+0.9%) compared to last year.
NIQ has identified four key category trends since the start of 2024. The first is shoppers buying convenient meal options which is reflected in strong growth in the past four weeks for prepared fresh meat products (+13%), frozen chips (+13%), cooking sauces (+7%).
The second key trend is cheaper meal ingredients; rice & grains (+13%), canned veg (+10%) and frozen poultry (+8%).
The third trend is a shift towards healthier snacking with growths in dried veg & pulses (+23%), and fresh prepared fruit (+7%).
The fourth key trend was events. With Pancake Day taking place in February, there was also a rise in sales for baking ingredients such as baking mixes (+24%), flour (+18%), eggs (+16%), golden syrup (+29%), and chocolate spread (+27%) during the week ending 17 February.
Mike Watkins, NIQ’s UK Head of Retailer and Business Insight, said: “Whilst industry volumes remain positive, many brands are now chasing growth having lost category share during the high period of inflation and are keen to communicate their own value among consumers.
“We expect the levels of promotion to continue to creep up over the next few months. Brands are also going to be important to sustain the recovery in FMCG spend and with Euro 2024 and Paris Olympics on the horizon, branded promotions will be the drivers of increased discretionary spend post Easter.”
Watkins added: “The resilience of online grocery shopping during the highest period of inflation in decades, when household penetration fell a little, is due to the changed lifestyles of consumers. When food inflation was in double digits, shoppers did cut back on large ‘trolley’ shops and online was also impacted.
“Whilst this growth is now against a weak comparative (-2.5%), it is also a normalisation of shopping behaviour for the one in four households who continue to shop this channel every four weeks and suggests that omnichannel shopping in food retail is here to stay.”
