According to the latest Kantar figures, a record £1.37 billion passed through the tills last month, with the average household spending at an all-time high of £477 across the month, an increase of £28 on 2022.

Total take-home grocery sales grew in value by 7.0% while the number of items bought rose by 2%.

Grocery price inflation fell to 6.7% in December, marking the fastest month on month drop that Kantar has recorded.

As predicted, Friday 22^nd December was the most popular shopping day, when just over 25 million trips were made and consumers spent £803 million in physical stores – 85% more than the average Friday in 2023.

BUDGET PRESSURES REMAIN

Despite the fall in grocery price inflation, head of retail and consumer insight at Kantar, Fraser McKevitt said consumers are still feeling the pinch.

“The rate of inflation is coming down at the fastest pace we have ever recorded, but consumers are still facing pretty hefty pressures on their budgets,” he said.

“Retailers were clearly working hard during the festive period to offer best value and win over shoppers, and promotions were central to their strategy. Nearly one third of all spend in the four weeks to Christmas Eve was made on items with some kind of offer, the highest level since December 2020 and £823m more than last year.”

Appetite for the traditional Christmas dinner was as strong as ever, with volumes of parsnips, sprouts and potatoes up 12%, 9% and 8% respectively, and chilled gravy up by 11%. Festive meals including pigs in blankets, sausages, hams and turkeys were also up by 6% collectively.

“We’re creatures of habit when it comes to Christmas and our data shows that the classic festive plate remains much the same,” added Fraser McKevitt.

“However, mince pies and Christmas puddings did buck the trend. They were less popular this year, with volumes falling by 4% and 7% respectively, but that isn’t to say we’ve lost our sweet tooth. Fresh cream was up by 5% across the month, so dessert was still very much on the menu.”

‘Retailers were clearly working hard during the festive period to offer best value and win over shoppers’

Meanwhile, discount retailers Lidl and Aldi saw their highest ever market shares for the Christmas period, with Lidl’s sales increasing by 13.8% and Aldi’s growing 0.2 percentage points.

Tesco, Sainsbury’s, Asda, Morrisons and Waitrose accounted for a combined market share of 70% during the 12 weeks to 24^th December.

Fraser McKevitt said this year was no exception for traditional retailers doing well in the run up to Christmas.

“Supermarkets saw especially strong performances for their own-label lines, with sales of premium ranges like Sainsbury’s Taste the Difference and Tesco Finest surging by 11.9% compared with last year, to £790 million. Branded sales rose by 6.0% during the same period,” said Fraser McKevitt.

Frozen specialist Iceland’s sales increased by 2.9%, with its market share at 2.4% and Asda accelerated sales growth to 3.4% to take 13.6% of the market.

Online purchases grew slightly ahead of the market during the four weeks to 24^th December versus last year, up by 7.5%.

The post Retailers enjoy highest December shopping figures in four years with Christmas boost first appeared on Neighbourhood Retailer.

There are many traditions at Christmas that people are very strict at sticking to and one of the first thoughts in people’s minds ahead of the festive season is food.

From savoury appetisers to the trusted chocolate favourites, consumers are sticklers for ensuring their cupboards and fridges are as well stocked as can be.

For retailers there really is no other shopping period that can compare – from gifting to dinner preparation and stocking up on the essentials, November and December are critical months in the industry.

While the ongoing cost-of-living crisis is inevitably curtailing some Christmas spending as consumers remain more considered about what they’re putting in their trolleys, Christmas is the one time where people are willing to spend a little more than normal in order to make it a special time for families and friends.

This Christmas grocery retailers will be hoping to emulate the covid bump which saw growth in the Northern Irish grocery market accelerate to 12.9% in the 52 weeks to 27^th December 2020.

Over the next couple of weeks, consumers will seek out the comfort and familiarity of previous festive seasons and find pleasure in the innocent delights of items such as the selection box.

Sweet treats remain an essential purchase for consumers at this time of year, with store cupboard staples such as boxes of biscuits and tubs of chocolates, retailers are stocking up on these items earlier and earlier each year.

Christmas desserts are another key component and stores such as M&S and Lidl continue to maximise this opportunity with a range own-brand desserts, from Lidl’s Melt in the Middle Pudding and Irish Christmas Cake from their Deluxe range, to Christmas Jumper Colin the Caterpillar and Christmas Caramel Cake from M&S.

It’s said that ‘money can’t buy happiness’, and most Brits (74%) believe that it can’t buy a happy Christmas either – according to the latest Mintel festive research. This is just as well, as just over half (51%) of consumers say that financial concerns will mean their household keeps to a stricter budget this Christmas.

With the cost of living a constant theme this year, a cautious 56% of consumers say that news stories about ‘shrinkflation’ mean they will be looking more closely at prices this Christmas. Overall, three in 10 (28%) consumers expect to pay for more Christmas spending on credit this year, up from 22% in 2022.

Meanwhile, the research also reveals that a quarter (25%) of Brits expected to wait for promotions/discounts (eg Black Friday) before buying festive gifts.

Mintel forecasts retail sales by value in November and December (both for in-store and online food and non-food) to hit £94.5 billion. This represents an increase of 3.6% compared to last November and December when sales reached £91.2 billion, but this year’s growth is solely driven by inflation. In addition, total sales by volume are forecast to decline by 2.9% as the market is hit by reduced discretionary spending.

Nick Carroll, Category Director of Mintel Retail Insights, said: “There’s little doubt that festive 2023 will be a challenging period for retailers, with over half of shoppers looking to cut back. However, there are signs of a well-timed recovery in confidence ahead of the big day.

“Several weeks ahead of Christmas Day shoppers may be cautious about their spending intentions but, as history shows, once the festive feeling takes over some caution is thrown to the wind. This should mean more opportunity for retailers this December compared to last year.

“The recovery in confidence is being driven by higher earners, while lower earners are still facing a further year of financial pressures. This will mean a highly polarised spending period, with value still high on the agenda for many.

“This environment lends itself well to Black Friday promotions, and the earlier launching of deals and the scale of retailers already engaging in the event mean all signs point to the event being as large as ever.

“Brands and retailers can cut through this festive period by giving some much-needed mood-boosting relief after another difficult year. Tapping into this feeling, the tone taken by most marketing campaigns so far has been more playful,” he added.

“Customers will be looking to keep a lid on spending while having a good time, and this makes it more tempting to splash out on lower-priced pick-me-ups, such as value fashion or premium ready meals.

“There’s also the chance for grocery retailers to receive a boost from the switch away from out-of-home spending by trying to recreate the benefits of eating and drinking out, from the comfort of people’s homes. For retailers as a whole, there’s everything to play for.”

TO VIEW THE FULL FEATURE IN THE NOVEMBER-DECEMBER ISSUE OF NEIGHBOURHOOD RETAILER, CLICK HERE

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And it is predicted that Friday 22^nd December will be the busiest day for festive grocery shopping, while retailers will sell nearly 41 million brussels sprouts per day in the week leading up to Christmas. The popular festive veg is now 4.3% cheaper than 12 months ago.

According to marketing data and analytics company, Kantar, latest figures show that sales grew by 6.3% over the four weeks to 26^th November 2023 to reach £11.7 billion.

The cost of a traditional Christmas dinner for four this year is up by 1.3% versus a year ago and now stands at £31.71. This tracks well below the headline grocery price inflation rate, which fell to 9.1% for the four weeks to 26^th November 2023.

Head of retail and consumer insights at Kantar, Fraser McKevitt said the scene is set for a record-breaking spend this Christmas.

‘The amount of money spent on deals usually leaps in the run up to Christmas, but this year is already looking a bit different’

“The festive period is always a bumper one for the grocers with consumers buying on average 10% more items than in a typical month. Some of the increase, of course, will also be driven by the ongoing price inflation we’ve seen this year,” said Fraser McKevitt.

“While the rate at which grocery prices are rising is still well above the norm, the good news for shoppers is that inflation is continuing to come down – it dropped again in November to 9.1%. The retailers are also battling it out to offer value to consumers during this important month for trading and are doing what they can to keep prices low.”

Retailers are putting the emphasis on own-label lines and promotions to attract people through their doors, with Kantar data showing that spending on offers hit its highest level in over two years in the latest four-week period, at 28.4%.

“The amount of money spent on deals usually leaps in the run up to Christmas, but this year is already looking a bit different,” added Fraser McKevitt.

“We’re well above 2022 levels, with customers making an additional £180 million in savings this November versus 12 months ago. Brands have benefited from the boost in offers and have now edged ahead of their own-label counterparts, growing sales by 6.5% versus 6.4% for retailer lines.

“However, own-label is still doing incredibly well and premium lines especially so. These products are up by 15.4% year-on-year, with wine, chilled ready meals and fresh beef among the big winners last month. We’re likely to see a seasonal jump in the premium stuffing, sausage meat and Christmas puddings over the coming weeks.”

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After 16 months of double-digit growth, this marks a significant milestone for both retailers and consumers.

Take-home grocery sales over the same four-week period rose by 7.4% compared with last year.

Own-label lines grew by 8.0% over the latest four weeks, though the gap is narrowing with branded products, which grew at 6.7% over the same period.

The proportion of sales through promotions is up across every grocer versus last year – something that has only happened on one other occasion in nearly 10 years.

Fraser McKevitt, head of retail and consumer insight at Kantar warned that while the drop to single digits is “positive news” and “something of a watershed” moment, consumers will “still be feeling the pinch”.

“We’re only seeing year-on-year price falls in a limited number of major categories, including butter, dried pasta and milk,” he said.

“Retailers continue to look at ways of softening the blow for shoppers and slowing the rate of price rises. This has included upping the ante on promotions – every single one of the grocers increased the proportion of sales through deals versus last year, which is something that has only happened on one other occasion in nearly 10 years.

“Consumer spending on promotions has now hit 27.2% of total grocery sales – the highest level we’ve seen since Christmas last year. This is a big gear shift from October 2022 when this figure was less than a quarter.”

He added that shoppers have been taking matters into their own hands in a bid to manage their spend.

“It’s now been over a year and a half of pinched pockets and people are continuing to respond by trading down on the items they’re putting into the baskets,” continued Fraser McKevitt.

“Own-label lines have grown ahead of their branded counterparts every month since February 2022, with the latest four weeks showing a sales boost of 8.0% for these lines. However, the picture may well change as we go headlong into the festive period when shoppers typically turn more to brands.”

He added that the fight for shoppers’ Christmas spend looks set to be fierce amongst retailers.

“When it comes to where people shop, Brits definitely aren’t loyal and some of the traditional shopping demographics and stereotypes have been thrown out of the window.

“The typical customer walking through the doors of the discounters is now representative of the country as a whole. Discounters are making their mark in frozen items and fresh groceries like meat and veg, with these categories constituting a higher proportion of their sales than the traditional retailers.”

The post Grocery price inflation drops below 10% for first time since July 2022 first appeared on Neighbourhood Retailer.

Lockdowns and covid restrictions meant the last two Christmas periods suffered in terms of footfall levels and sales, however this year sees a return to more ‘normal’ trading conditions.

Indeed, some of NI’s key retailers are witnessing a surge in sales, with footfall and basket spend increasing “significantly” and trading in some already up 9.3% on the same period 12 months ago.

“We have noticed a significant increase in turnover this year compared to the previous year in our core grocery sales,” explained Ruairi McBride, manager at Ivan Wilson Limited, Limavady.

“Over the last eight weeks we are trading up 9.3% on the same period last year. Footfall has also increased significantly with an increase of 3.6% and the average basket spend is up 3.2% as well,” he added.

Gary McCulloch from JC Stewart Foodhall, Magherafelt said their December trading has been “very strong” with an emphasis still on ‘Shop Local, Support Local’.

“We remain to have a great level of growth in our business,” said Gary. “We have just ended a shop local campaign rewarding customers for their loyalty with a ‘win a £100 voucher’ campaign over the past six weeks, giving away £600. This was the highest response to the campaign to date with thousands of entries weekly.

“Sales and footfall remain very positive with our store considered a destination for everything Christmas. We have a great customer base who remain to support us year-on-year and this is reflected in the strong sales growth.”

Gary said their customers have been focusing on making Christmas as special as possible.

“We have found that Christmas this year is all about the family and purchases suggest that it’s a year to go all out and enjoy the festive period, with a significant rise in pre-orders for meat and desserts,” he said.

‘We have noticed a significant increase in turnover this year compared to the previous year in our core grocery sales’  Ruairi McBride

Overall, however consumers are remaining cautious in their spending habits, according to Jonathan McCullagh, from McCullagh’s Classic in Omagh.

“It really is a mixed bag with our customer mix. Those that can afford to will go all out and others, given the current economic circumstances, are very price conscious,” he said.

“SPAR’s 12 Deals of Christmas has driven that value message in store and has proven to be a great hit with customers this year.”

This trend is being witnessed by other retailers across the province.

“This year has been really tough with the cost of living becoming incredibly expensive for everyone,” said Ruairi McBride.

“Our customers with young kids have been more considered in their shopping habits and actively seeking the promotional items in store. Those customers that don’t have young dependents seem to have adopted a different mindset and don’t seem to put as much thought into their purchasing habits.”

Cormac Rice, from Carnbrooke in Lisburn said they also have a “mixed demographic”.

“There is something for everyone here. Customers shop with us for quality, provenance and service. The trend we have in both foodhalls is customers wanting quality products and something they can’t get everywhere else,” he said.

Indeed, Cormac said this was also a factor in their cross-border trade.

“As a destination for local and quality food products, we do have an element of customers travelling cross-border, particularly at weekends,” he said.

“Although small in the overall mix of more local shoppers, we do have many customers travelling 20-30 miles to purchase the Carnbrooke products. There has been an increase in home deliveries since we launched our website in early 2022, which has helped showcase our offering cross-border,” he added.

Stock remains in “good supply” for many retailers ahead of the expected rush in the coming days, and they are all anticipating a significant increase in footfall as the final Christmas preparations are made.

“We expect to see a strong uplift in sales compared to other years, with customers coming to us for all their Christmas shopping,” said Gary McCulloch.

‘If customers trust you for their Christmas essentials, then you have a good chance of securing their custom for the rest of the year’  Jonathan McCullagh

“This is expected to be our busiest Christmas trading period to date and a time to drive sales throughout the store.”

“These are our busiest days of the year in terms of sales,” agreed Jonathan McCullagh. “Footfall and customer basket spend will increase significantly.

“It’s our aim to ensure we offer value and that the customer can find everything they need within our store – if customers trust you for their Christmas essentials, then you have a good chance of securing their custom for the rest of the year, so it’s a key trading period.”

Cormac Rice said that due to the “vast amount” of their fresh food offering, the last few days before Christmas sees “a huge uplift in footfall and spend”.

“At the peak, a busy day could see turnover more than triple a busy weekend’s trade,” he said.

“We have extended our trading hours as it would be impossible to manage the volume of orders and footfall. Although extremely busy, we are well organised and it runs very smoothly.

“It’s a very busy time up until the doors close on Christmas Eve. Everyone enjoys a few days off, as the whole business closes at that point for a well-deserved break.”

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