If the latest Kantar Worldpanel figures are anything to go by, the British grocery market remains as competitive as ever. Despite the tendency for customers to 'trade up' during the festive period, Kantar reckons it was still the discounters - namely Aldi and Lidl - who came out on top as 2015 became 2016.
Aldi grew its share of sales over the 12 weeks ending 3 January 2016 to 5.5 per cent from 4.8 per cent the previous Christmas, while Lidl grew its share from 3.5 per cent to 4.2 per cent. That contrasts with companies such as Tesco (TSCO), which saw its share of sales slip from 29.1 per cent this time last year to 28.3 per cent. Out of the traditional high street grocers, it seems Sainsbury's (SBRY) is - to quote one City analyst - "the best of a bad bunch", as its share of sales edged up from 16.9 per cent to 17 per cent. The premium end of the market also appeared to perform well, with groups such as Waitrose growing its share of sales from 5.1 per cent to 5.2 per cent.
Kantar also highlighted some interesting sectoral trends. According to the research body, the average amount spent on Christmas dinners fell by a not-insignificant 2.2 per cent, while alcohol sales increased thanks to the popularity of sparkling wines and Prosecco.
The past week is a key one on the calendar as grocers released updates on how Christmas went. Stricken chain Morrison (MRW) was first out of the gate, reporting a better than expected 0.2 per cent improvement in like-for-like sales excluding fuel. Total sales fell 1.2 per cent, but that was to be expected given chief executive David Potts' decision to offload 140 M Local convenience sites last year. It seems focusing less on the physical store estate is also working: online sales nearly doubled year on year.
Larger competitor Sainsbury also revealed a relatively strong third-quarter's trading, although much of the focus by analysts was on its prospective tilt for Argos owner Home Retail (HOME). Like-for-like sales dipped 0.4 per cent, but transaction volumes grew as did market share. Total retail sales grew 0.8 per cent, helped by a strong performance from the general merchandise division - pretty impressive given the warmer than usual Christmas weather.
