Kantar: online grocery market reaches record share but booze growth slows

Online grocery in the UK has reached a new record market share over the last four weeks, accounting for 13.5% of sales, the latest stats from Kantar show, and although booze sales are showing strong double-digit growth, there has been a slow down since last month.

The move online has been one of the most significant lockdown trends, the retail analysts said, but following the relaxation of lockdown rules across the country – with the exception of significant local lockdowns – there is evidence that some of the more extreme lockdown trends in the grocery market have softened, consumer insight director Charlotte Scott said.

The grocery market grew by 14.4% during the past 12 weeks, although booze sales saw growth of 28.3%, well ahead of the market.

However speaking to the drinks business, Scott said there has been a “significant step back” in terms of sales, following last month’s 41% growth in alcohol sales, reflecting the trend across the wider grocery market.

However, she argued that 28% was “still huge”, noting that ther are still a lot of drinking occasions that pre-Covid-19 would happen out of the home that are now happening in the home.

“But as the offtrade starts to open, some of those will move out, but we expect that to be a gradual process. But it’s following the general [grocery] trend – that step back in growth both in terms of  people buying less in terms of volume and not replenishing as often.”

Within the category, beers, wines and spirits were all performing strongly, she said, but non-alcoholic beer had not seen as much of a step back as the rest of the category.

“Obviously it’s a relatively small sector compared to some of the others, but non-alcoholic beer is holding its growth rate, it grew 37% in the last  weeks, and I think it’s part of that broader trend we’re seeing.  But equally wine, beer and spirits seeing strong growth, there’s not one area that’s underperforming.

As Scott noted, the data covered the start of the new ‘eat out to help out’ scheme that runs throughout August to help tempt consumers back into the on-trade and as alcohol is excluded from the scheme, this may make it “a resilient category for the grocers”

‘Far from normal’

Things in the grocery retail sector were still far from normal, however, and although growth had slowed to 14.4% year on year during the 12 weeks to 9 August 2020, it is still up on pre-pandemic levels. The new rules on wearing masks in shops does seem to have resulted in the number of visits dropping since last month, as shoppers need to plan trips better. But although the current average of 14 shopping trips per month per household is lower than it was last month, it is still higher than in April and May, when lockdown rules were tighter.

“While some consumers have shopped more often in the past month, the story varies in different parts of the country, with localised lockdowns and slower openings resulting in people making fewer trips in the North, the Midlands and Wales,” she noted.

The average weekly spend dropped below £25 for the first time since March during the period, but at £24, it is still higher than the pre-Covid average of £19 per trip.

With the UK officially entering recession last week, more atypical behavoiur is expected, wtih shoppers managing their spend more carefullly.

“Early evidence suggests that most are not yet choosing to trade down, with brands and premium own label lines currently performing well, however price cuts have increased compared with July as some people look for opportunities to save,” she said.

“But overall the trend is that people are looking to treat themselves or buy brands they trust.”

All the retailers saw sales grow in the last 12 weeks although the rate of growth was slower than in July, except at online player Ocado, which is still seeing growth of 45.5%, taking its market share to 1.8% over the past 12 weeks.

Symbols and independents also saw growth of 45.5%, taking their collective market share to 2.2%.