Grocery Market Share Ireland - Less is more

Irish grocery market slows as consumers buy less groceries

The latest grocery market figures from Kantar Worldpanel in Ireland, published today for the 12 weeks ending 20 March 2011, show a dramatic response by consumers to food price inflation.

Market growth dipped this period to 0.8% compared with 1.6% last month. However, growth continued despite price inflation of 5.3%.

In a bid to control spending, shoppers cut back on the amount of groceries they bought this period with the average household reducing the amount of goods it purchased by 4%.

David Berry, Kantar Worldpanel Ireland, explains: “The biggest impact of the cutbacks was felt in the fresh and chilled sector, with the average household buying 4.7% fewer fresh or chilled products than it was three months ago. This shift towards reduced basket size demonstrates that consumers are cutting back where they can.”

In addition to reducing the amount they buy, shoppers also continued to trade down to cheaper products this month. Consequently own brand products now account for 35% of grocery spend, compared with only 33.5% last year.

David Berry continues: “Unsurprisingly there were mixed performances from the retailers this month with only Tesco, Aldi and Lidl growing ahead of the market. Value conscious shoppers continued to switch more of their grocery spend to the German discounters, with Aldi growing its share to 4% compared to 3.2% a year ago and Lidl increasing its share from 5.6% in 2010 to 5.9%. Tesco benefited from its recent store openings and increased its share to 27.2%.”

Elsewhere SuperValu posted a slight drop in market share, falling from 20.1% to 19.8% in the past 12 months. However, SuperValu’s recent announcement of future store openings demonstrates its investment in building its market share, suggesting the outlook for the retailer is positive.

Dunnes Stores continued to perform behind the market but its sales stabilised this month, following a prolonged decline throughout 2010, as it retained its 23.3% share of the market from last month.

An update on inflation

Grocery inflation remained at 5.3% for the 12 week ending period 20 March 2011.*

*This figure is based on over 75,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.