Grocery price inflation falls to lowest rate in almost two years
Grocery price inflation has fallen to 5.3%, marking the lowest rate since March 2022, and a decrease of 1.5 percentage points from January.
According to the latest Kantar data, value was still a priority for shoppers, with £586 million more being spent on promotions than the same month last year, while take-home grocery sales grew in value by 5.1% for the four weeks to 18th February 2024.
Following the increasingly-popular consumer commitment to ‘dry January’, alcohol sales enjoyed a boost, up 18% in volume terms.
The Kantar data also shows that Valentine’s Day this year was marked on a budget, with £36 million spent on meal deals costing £10 or more in the week before 14th February.
As strategic insight director at Kantar, Tom Steel explains, things are looking up for shoppers.
“Consumers have been navigating a grocery inflation rate of more than 4% for two years now, so this latest easing of price rises is especially welcome,” he said.
“Though there’s been lots of discussion about the impact the Red Sea shipping crisis might have on the cost of goods, supermarkets have been pulling out all the stops to keep prices down and help people manage their budgets.”
PROMOTIONS PAY OFF
Tom added that promotions accelerated this month after a post-Christmas slowdown, with consumers spending on offers increasing by 4% in February.
“Sainsbury’s and Iceland’s efforts paid off in particular,” said Tom. “They were the only retailers to attract more shoppers through their doors.
“The battle between supermarkets’ own-label lines and brands also remains fierce. Own-label nipped ahead this month, growing sales by 5.5% versus branded products at 5.3%”
February saw a return to indulgence for some consumers as dry January came to an end, with consumers buying 28% more wine and 16% more beer and lager. Red wine was particularly popular, with eight million more bottles bought this month than in January.
Meanwhile, Lidl was the only retailer to achieve double-digit growth, with sales up by 10.9% over the 12 weeks to 18th February 2024, making it the fastest growing grocer for the sixth month running. It now holds a 7.5% share of the market, an increase of 0.4 percentage points.
