UNIVEG Katope UK

TNS Figures Shows Market Solid as Discounter Growth Slows

3rd July 2009

Retail and Grocery analysts IGD reflect on the latest market share figures released this week.

The latest 12 weeks sales growth and market share figures from TNS, for the period to 14th June 2009, indicate that the grocery market grew at 6.5% over the preceding three months, sustaining its strong trend of much of 2009.

However, the pattern of individual performances within this have now changed significantly from earlier in the year. Above all the very rates of growth amongst the smaller discount players has slowed substantially, with Aldi and Lidl, notably pegged back in single figures (8.7% and 7.5% respectively) for the first time in a long while, and now actually trailing some of the bigger, mainstream, competitors.

Both Morrisons and Sainsbury's outstripped the leading discounters for growth, with Morrisons once again leading the top four on 9.3%, while Sainsbury's achieved its fastest rate of growth in a while on 8.9%. While Asda was not far behind on 8.2%, Tesco still lagged the market on 6.2%.


12 Week Market Shares

  12 weeks to 15 June 2008 12 weeks to 14 June 2009
Tesco  30.9% 30.8%
Asda       16.6% 16.8%
Sainsbury's 15.8% 16.1%
Morrisons 11.3% 11.6%
Co-op (inc Somerfield) 9.0% 8.3%
Waitrose   3.9% 3.9%
Iceland 1.7% 1.7%
Netto  0.7% 0.7%
Lidl    2.3% 2.3%
Aldi     2.9% 2.9%
Other Multiples  1.6% 1.7%
Total Independents 1.7% 1.5%

Source: TNS Worldpanel


Please note: In this release TNS has upgraded its methodology to provide a more representative read of the co-operative movement and the total market. This has resulted in a one-off share increase for the co-op and small downward adjustments for other retailers. Therefore share data in this release cannot be compared directly with previous monthly releases.

Analysis

Though Tesco growth is clearly picking up as 2009 progresses, with the retailer growing more or less at the same market overall in this latest period, it is clear that its major competitors in the big four are actually still managing to stay well ahead of it. Average growth for the big four is in fact well ahead of total market growth on 7.7%, behind which Tesco trails by a full percentage point and more, while in fact the other three combined (+8.7%) outstripped that average by an equal amount.

It is clear that whatever the upsides are in the market, they continue to play notably more strongly in favour of Asda, Morrisons and Sainsbury's than Tesco.

Clearly the slowing of the growth of the discounters (including Iceland) must owe much to the increasingly tough comparatives that they are now facing from last year, when growth in and around 20% was the norm for them. However, they are, nevertheless still successfully outpacing the market as a whole.

The current presence of so many strong positives in the market owes something at least to the Co-op/Somerfield store disposal process, required by the OFT following the completion of the deal in March. With over 130 stores changing hands a number of retailers have been enjoying a considerable uplift from the additional space, not least Morrisons. These also include Waitrose; which after languishing in growth terms for the best part of a year is now ahead of the market, boosted by a number of Somerfield conversions.


Source: IGD

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