Supermarket sales growth falls as shoppers rebalance spend

basket of food

Grocery sales growth slowed by -0.7% in the past four weeks ending 9 October 2021, as UK shoppers begin to rebalance their spending habits, new data from NielsenIQ shows.

The data reveals that in the past four weeks UK shoppers spent £11.8bn on groceries, which is £41m less than the same period last year, but this is still up 6.6% compared with pre-pandemic shopping two years ago.

NielsenIQ also reveals that spend on promotional items remains low at 20%, down from 22% during the same period last year, amid growing concerns around availability issues and disruption in the supply chain.

The figures also show that consumers are moving their food shopping habits towards an omnichannel experience, as both visits to stores (+5.5%) and online shopping trips (+5.3%) increased.

NielsenIQ Ecommerce Benchmark data shows shoppers are buying more convenience items online, with sales of fresh pizza (+17%), mineral water (+17%), freshly prepared salads (+11%), and cakes (+10%) all rising within the 12-week period ending 9 October 2021.

Mike Watkins, NielsenIQ’s UK Head of Retailer and Business Insight, said: “October will be a tipping point for food retail spend. This is down to a plethora of factors, including cautious consumer sentiment, increased concerns about discretionary spend, and ambient food inflation – which accelerated to 0.8% in September and also ‘lockdown 2’ comparatives starting in November. This is likely to be reflected in top line growth continuing in the region of -1% to +1%.

“These trends will also give added momentum to value-based retailing – with shoppers looking to spend less but still get good value for money. As a result, supermarkets may rely less on broad promotions and instead focus on driving loyalty via smart targeting of discounts and personalised price cuts, and if needed, the return of vouchering.”