Shoppers 'spending more' on supermarkets' own-label ranges ahead of Christmas

Updated: 

Shoppers are expected to spend a record amount on supermarket premium own-label ranges this Christmas against a backdrop of continuing slow growth for grocers, figures suggest.

Consumers are spending 13% more on these lines than they did last year, Kantar Worldpanel data for the 12 weeks to December 4 show.

However, overall supermarket sales grew by just 0.7% year on year.

Some 88% of shoppers are now buying from top-tier private label brands, which now find their way into 12% of grocery baskets.

In the past 12 weeks, 6.3% of own label purchases were from premium lines such as Tesco Finest and Sainsbury's Taste The Difference, well ahead of the 5.7% recorded last year.

Kantar Worldpanel said that both Morrisons' The Best and Asda's Extra Special lines were selling particularly well, with sales up by 35% and 15% respectively.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: "Over Christmas it's likely that premium lines will record their highest ever sales figures as even more shoppers trade up to treat their loved ones."

The figures follow a run of positive reviews of supermarket own-label Christmas products, with Lidl, Aldi and Asda faring particularly well in quality-for-money ranking by consumer groups and food magazines.

Meanwhile, Aldi was the only retailer to record double-digit sales growth, with its premium Specially Selected brand helping the discounter to increase sales by 10% year-on-year, with Iceland just behind with an 8.6% sales uplift.

Other grocers to enjoy a sales uplift included Lidl, up 5.7% year-on-year, Co-op (2%) and Waitrose (1.1%).

Tesco increased its value sales by 1.6% on last year as the UK's biggest grocer expanded its market share to 28.3%, as Sainsbury's fell by 0.6% with market share dropping slightly to 16.5% and Asda suffered a 4.7% drop but at a marginally slower rate than in recent months.

Despite the fall in the value of the pound following the Brexit vote, inflation has still not fed through into Britons' shopping baskets, with Kantar recording a 0.1% drop in the cost of a typical grocery basket compared with this time last year.

However there have been price rises in particular food categories, with fresh fish up 5.3% on last year, chilled ready meals up 2.3% and beer costing 2.1% more.

Separate figures from Nielsen show UK supermarket sales falling for the first time in five months due to a combination of Black Friday affecting non-food buying and falling prices as Christmas offers kicked in.

Money taken at the till was down 0.4% and the amount of good sold was down 0.3% on this time last year - the first time this has happened since mid-July.

Even the discounters were not immune, according to Nielsen, with Aldi's annual growth dropping into single figures (8.5%) for the first time in four years, while Lidl's 2.7% growth was six times smaller on last year.

Mike Watkins, Nielsen's UK head of retailer and business insight, said: "After a strong start to November, shoppers' seemed to have held back on food spend in the last few weeks, despite some the very attractive Christmas offers and price reductions.

"However, we expect momentum to pick up again and the week ending Christmas Eve will be a massive opportunity for the big four supermarkets to regain market share."

Nielsen estimates shoppers will spend around £4 billion at supermarkets in that week alone, with Thursday December 22 expected to be the biggest day of the year.