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Sainsbury's suffers sales decline after end of multibuy discounts Sainsbury's suffers sales decline after end of multibuy discounts
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Sainsbury’s has suffered its biggest decline in sales in nearly a year after dropping multibuy offers in favour of price cuts.Sainsbury’s has suffered its biggest decline in sales in nearly a year after dropping multibuy offers in favour of price cuts.
Sales at the UK’s second largest supermarket dipped 1.2% in the 12 weeks to 22 May, the worst performance since June last year, taking its market share down to 16.2%, according to the latest figures from Kantar Worldpanel.Sales at the UK’s second largest supermarket dipped 1.2% in the 12 weeks to 22 May, the worst performance since June last year, taking its market share down to 16.2%, according to the latest figures from Kantar Worldpanel.
Ed Garner, director at Kantar Worldpanel, said the drop at Sainsbury’s was the result of a shift in promotional emphasis from multipack deals to straightforward price cuts. Sainsbury’s also recently ditched its brand match promotion – in which it pledged to refund the price difference if branded goods cost more than at Asda. Ed Garner, director at Kantar, said the drop at Sainsbury’s was the result of a shift in promotional emphasis from multipack deals to straightforward price cuts. Sainsbury’s also recently ditched its brand match promotion – in which it pledged to refund the price difference if branded goods cost more than at Asda.
All the major supermarket chains saw sales fall over the three-month period, but Tesco took Sainsbury’s crown as the best performer as its sales fell by 1%.All the major supermarket chains saw sales fall over the three-month period, but Tesco took Sainsbury’s crown as the best performer as its sales fell by 1%.
Asda continued to be the worst performing grocer as it slumped to its lowest market share in 14 years – 15.8% – as sales fell by 5.1%. The supermarket is struggling to hold on to its price-conscious shoppers who are being tempted away by discounters Aldi and Lidl. Lidl was the UK’s fastest growing grocer with sales up 14.2% as it sold 65% more of its premium Deluxe range of foods. Asda continued to be the worst performing grocer as it slumped to its lowest market share in 14 years – 15.8% – as sales fell by 5.1%. The supermarket is struggling to hold on to its price-conscious shoppers who are being tempted away by discounters Aldi and Lidl. Lidl was the UK’s fastest-growing grocer with sales up 14.2% as it sold 65% more of its premium Deluxe range of foods.
Ed Garner, director at Kantar Worldpanel, said: “This is not just about low prices.” He said shoppers were taking advantage of price cuts to trade up to more luxurious or better quality foods across the board. Aldi’s sales of its premium Specially Selected range rose 15% while Sainsbury’s Taste the Difference and Morrisons’ top Signature ranges both increased sales by about 4%. Aldi’s sales rose by 11.4% – the chain’s slowest pace of growth since 2011 – but still much faster than the rest of the market.
Garner said: “This is not just about low prices.” He said shoppers were taking advantage of price cuts to trade up to more luxurious or better quality foods across the board. Aldi’s sales of its premium Specially Selected range rose 15% while Sainsbury’s Taste the Difference and Morrisons’ top Signature ranges both increased sales by about 4%.
Prices across the market dropped by 1.5% – led by fresh produce. Vegetable prices dropped more than 3% and there was also deflation in pork, poultry, butter and eggs.Prices across the market dropped by 1.5% – led by fresh produce. Vegetable prices dropped more than 3% and there was also deflation in pork, poultry, butter and eggs.
The major chains have been forced to cut prices to combat rising competition from discounters Aldi and Lidl. Gardener said 94% of shoppers who visited the two German chains also went to the big four supermarkets but they were increasingly shifting spending to the discounters and other alternatives.The major chains have been forced to cut prices to combat rising competition from discounters Aldi and Lidl. Gardener said 94% of shoppers who visited the two German chains also went to the big four supermarkets but they were increasingly shifting spending to the discounters and other alternatives.
Waitrose and the Co-op are also benefiting – with sales up 2.1% and 3.3% respectively according to Kantar.Waitrose and the Co-op are also benefiting – with sales up 2.1% and 3.3% respectively according to Kantar.
“Cutting fresh food prices is an important weapon for the supermarkets in their battle with the discounters,” said Mike Watkins UK head of retailer and business insight at market analysis firm Nielsen.“Cutting fresh food prices is an important weapon for the supermarkets in their battle with the discounters,” said Mike Watkins UK head of retailer and business insight at market analysis firm Nielsen.
Nielsen’s figures revealed a 4.1% increase in the volume of fresh produce sold in the 4 weeks to 21 May as shoppers took advantage of price cuts to eat more healthily. Nielsen’s figures revealed a 4.1% increase in the volume of fresh produce sold in the four weeks to 21 May as shoppers took advantage of price cuts to eat more healthily.