Discounters Aldi and Lidl now account for more than 10% of all grocery sales, Nielsen reports


Discounters Aldi and Lidl now account for more than 10% of sales at the UK’s leading supermarkets, according to the latest data from global information and insights company Nielsen.

During the twelve weeks ending 31 January 2015, Aldi’s sales grew 17.3% year-on-year, and Lidl’s, 13.8%, while total supermarket sales increased just 0.7%. Consequently, Aldi and Lidl hit a combined market share of 10.7% – or £1 in every £9.31 spent at UK supermarkets – up from 9.3% in the corresponding period last year.

Changing grocery market share by retailer

“The 10% market share for discounters has not been seen since the heyday of Kwik Save some 15 years ago,” said Mike Watkins, Nielsen’s UK head of retailer and business insight. “Initially built on the premise of saving money, the new wave of discounters are now a regular part of grocery shopping and have changed shopping habits forever. For instance, switching to cheaper grocery brands is again the No 1 household tactic for saving money. Furthermore, nearly half of those cutting costs will continue to buy cheaper grocery brands even when economic conditions do improve.

“However, what is different this time is that discounters are no longer solely associated with price. They’ve been very astute at promoting the quality of their offerings to appeal to a wider range of consumers.”

Sainsbury’s and Aldi biggest spender on TV and Press advertising

In the four weeks ending 31 January 2015, Sainsbury’s spent the most on TV and press advertising (£4.6m), just ahead of Aldi (£4.5m). M&S increased spend the most – up 153% to £2.1m– followed by Lidl (up 138% to £2.4 m).

“The discounters’ rise in market share has been aided by investing heavily in advertising spend,” said Watkins. “In the 12 week period, for example, Aldi spent the most on advertising in relation to its market share. Lidl is third in this regard behind M&S.”

The overall market

Aggregate sales value growth for the UK’s leading supermarkets during the four weeks ending 31 January 2015 was down -0.1% year-on-year. Unit sales (volume) continued to improve slowly, increasing +1.7% year-on-year – the second consecutive four-week year-on-year increase.

Watkins said: “Price cuts at the start of month – a major focus in TV and press ads – encouraged shoppers back into stores, while category growths were helped by continued promotional spend. Shoppers took advantage of these giveaways, particularly stocking up on packaged soft drinks (volume sales +3.7%), household items (+2.4%) and grocery items (+2.0%).”

In the four-week period, Morrisons was the only one of the big four supermarkets to increase sales, helped by increased spend-per-visit and by attracting new shoppers. “This indicates that the launch of their loyalty price match card “Match and More” is having a positive impact on trading performance,” said Watkins.