FMCG Weekly Macroview News Update - w/c 11th April 2016

Macroview Weekly News updateYour window on the latest trends in Packaged Groceries

Stephen Hall

Friday 15th April

Copyright © 2015 Information Resources, Inc. (IRI). Confidential and Proprietary. 2

• High awareness of proposed sugar tax not yet transferring into changes in shopper behaviour

• Tesco to accept Sainsbury’s ‘Brand Match’ coupons• Poor weather and earlier Easter hit retail sales last month• Early Easter boosts Irish supermarket sector; SuperValu still top with Tesco

continuing to improve• Waitrose to show customers where food comes from• Shift towards online grocery shopping continuing to accelerate • McCormick abandons bid to buy Premier Foods• Tesco returns to profit as transformation plan delivers • John Lewis sales up 15.1% last week• Colouring books linked to WH Smith's best performance in years• Positive Q4 trading as Nisa recovery continues• Profits up at House of Fraser and Debenhams• Underlying sales improve at Unilever despite ‘challenging’ trading conditions• Like-for-Like sales down at Poundland amid tough trading conditions• Waitrose still UK’s best loved supermarket chain, with Aldi coming second ahead of

M&S

Weekly News Summary –11th April 2016


High Awareness Of Proposed Sugar Tax Not Yet Transferring Into Comparable Changes In Shopper BehaviourAlthough a massive 93% of shoppers say they are aware of the ‘sugar tax’ on soft drinks announced in the recent Budget, the biggest change in shopper behaviour – ahead of any single change in our consumption habits – has been an increase in the number of us reading food and drink labels. .

The latest Bridgethorne Shopper Index, from category and shopper management specialists Bridgethorne, shows that whilst 48% of us are reading labels more often than before, just 44% have begun buying low or no sugar fizzy drinks; 34% have given up or reduced their intake of foods like cakes or biscuits, and 30% have reduced their consumption of fruit juices. Only 22% say they have begun restricting foods eaten by others in their household and just 19% are buying low or no-sugar confectionary.

There is evidence in the Index, however, to suggest that although Government messages are cutting through, the degree of impact maybe somewhat muted. More than half of all respondents said they either rarely (32%) or never (26%) take any notice of Government food advice, compared to 39% who say they sometimes do and only 2.4% shoppers who say they always follow Government advice on what food and drink to buy.

An analysis of responses by life stages, however, shows those with families are the most likely to adhere to Government advice; 53% of these shoppers follow it, in some form. Empty Nesters and adult only households are the least responsive with less than 30% adhering to Government advice in one form or another.

Sugar continues to be the topic that engages shoppers most. Given the recent announcement on the ‘Sugar Tax’ and the consequent media focus on it, it is perhaps unsurprising that nearly two thirds of shoppers say that they would take notice of the recommendation, not least perhaps as it may have a direct, albeit limited impact on household budgets.

Concern about sugar has risen among all shoppers since the Bridgethorne Shopper Index last asked about it in August 2015, with 52% expressing concern now compared with 49% then. Although sugar is the food related ingredient of most concern across all of the life stages, there have also been small rises in those expressing anxiety about salt content and additives. Different food ingredients also come under focus depending on our time of life. For example, the retired are extremely concerned about salt content, which may be linked to cardiac health issues.

“Sugar has been in the media for some time, but has had overwhelming exposure in the recent coverage of the Budget,” commented John Nevens, Joint Managing Director, Bridgethorne.

“These findings suggest that while shoppers have an appetite for information, they intend to use it to make their own decisions about what they should or should not buy and ultimately consume.”

Source: NamNews 11th April 2016


Tesco To Accept Sainsbury’s Brand Match CouponsTesco is capitalising on Sainsbury’s announcement last week that it is scrapping its Brand Match scheme by allowing its customers to use its rival’s coupons to get money off their shopping. .

Sainsbury’s is ending Brand Match to focus investment on offering its customers lower everyday prices. The scheme, which now only price matches against branded goods at Asda, will close on the 26 April with shoppers having two weeks after this date to redeem any outstanding coupons. However, Tesco said today that customers will be able to use their Sainsbury’s Brand Match coupons at its stores until June.

Matt Davies, Tesco’s UK and ROI CEO, said: “This is a little help for Sainsbury's customers from us at Tesco. It also provides the opportunity for Sainsbury’s customers to experience Tesco’s Brand Guarantee, which we launched in October, and has been universally welcomed by our customers."


http://www.kamcity.com/namnews/asp/newsarticle.asp?newsid=84628


Poor Weather And Earlier Easter Hit Retail Sales Last MonthLatest figures from the BRC–KPMG Retail Sales Monitor show UK retail sales fell by 0.7% on a like-for-like basis during March, impacted by unsettled weather, the timing of Easter and falling grocery prices.

On a total basis, sales were flat, against a 4.7% rise in March 2015. However, the figure was distorted by the earlier timing of Easter this year and its impact on school holidays. On a three-month basis, total UK retail sales rose 1.4%, in line with the 12-month average.

Online sales of non-food products in the UK grew 9.5% in March versus a year earlier, when they had risen by 12.3% over the previous year.

Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said: "Neither growth nor decline in total year-on-year sales in March, although this relatively disappointing picture is distorted by the earlier timing of Easter this year. Food in particular was affected by this timing effect, with sales over the last three-months falling 0.7%; the largest decrease since June. The fashion category also found the going tough, with both clothing and footwear sales showing their largest decline since September 2014, despite increased promotional activity. However, it was a bit of a mixed picture across the industry as a whole with big ticket items continuing to do well and furniture being the main contributor of total sales growth.

"Looking at the long-term picture, the rolling 12-month average growth slowed to 1.4%, its lowest since August 2015. This slowdown can't be viewed in isolation; retail is an industry undergoing significant structural change as the investment in the digital offer continues apace while, from a consumer perspective, more disposable income is being spent on leisure and entertainment."

David McCorquodale, Head of Retail at KPMG, added: "Despite the clock move bringing extra hours of daylight, there was no ‘spring forward' for retail sales during March with growth broadly flat overall.

"Earlier Easters are not always good for the fashion industry as consumers are put off purchases of lighter fashions and footwear in cooler temperatures and this was certainly the case this year. However, furniture and home accessories benefited from consumers taking on home improvement projects over the long weekend while the ‘Mother's day effect' boosted sales of jewellery and watches.

"The grocery sector's drive for everyday low pricing and waste reduction contributed to the decline in food and drink sales, pulling the three-month average total sales into the negative.

"Looking ahead, retailers will be hoping for fewer April showers this month to entice spending on these newly launched ranges and to help alleviate the additional cost burden with the implementation of the National Living Wage."



Early Easter Boosts Irish Supermarket Sector; SuperValu Still Top With Tesco Continuing To ImproveLatest supermarket share figures from Kantar Worldpanel in Ireland for the 12 weeks ending 27 March 2016 show that an early Easter boosted growth across the Irish grocery market. Supermarket sales grew by 4.6% when compared with the same period last year – up from growth of 3.6% last month.

David Berry, director at Kantar Worldpanel, commented: “An early Easter saw shoppers spend an extra €40m on groceries as they prepared to celebrate with family and friends. Fresh produce sales were up by 11% compared with last year as shoppers picked up the trimmings for their Easter roasts, while crisps and snacks received a 12% boost. Sales of confectionery were up 32% as the nation stocked up on sweet treats, with 69% buying at least one chocolate egg during the Easter period.”

SuperValu retained the top spot, cementing its lead with a slightly increased market share of 24.9% – up 0.1% year on year. Shoppers have visited the retailer more often so far this year, with the average number of trips increasing to 22 – up from 20 in 2015 – with a sales increase just ahead of the market at 5%.

Meanwhile, Tesco posted sales growth for the fourth consecutive month as its performance continued to improve. Kantar Worldpanel’s data showed that volume growth remained stronger than value – an increase of 2.7% compared with 1.4% – as the chain continued to focus on keeping prices low.

Dunnes Stores also continued to make strong progress, driven by larger shopping trips, with spend per trolley increasing by €3 year on year. At 8.3%, its sales growth was the highest among the three biggest grocery retailers. The group’s market share has increased from 23.9% to 25.6% over the last year, with its Shop and Save campaign proving particularly effective with families.

Elsewhere, Lidl continued to set the pace with the strongest sales increase in Irish grocery – 9.5%. Kantar Worldpanel said the discounter is in the strong position of getting more consumers through its doors while also encouraging them to spend more on each visit and return more frequently. Meanwhile, Aldi’s sales growth was more subdued at 1.5%, mainly driven by shoppers spending more on each visit.

Kantar Worldpanel’s data showed that grocery market inflation stood at 2.7% for the 12 week period, up from 2.6% during the last period.



Waitrose To Show Customers Where Food Comes From – Live!Waitrose is launching a major campaign this week aimed at giving customers the chance to see first-hand where their food comes from.

The campaign kicks off with a series of TV adverts which will be filmed on the same day of broadcast. The group said that unprecedented short timescales between filming and screening will give the advert immediacy and authenticity.

In an industry first, the supermarket will also ‘live stream’ footage from its own farm, Leckford Estate in Hampshire. Throughout the day, commuters at major train terminals including Waterloo Station will be able to watch live footage from three different locations of the Waitrose farm, including beehives, rapeseed and panoramic views of the countryside.

The opening TV advert, which will be filmed and broadcast on 15 April, will come from a dairy farm near Newbury that supplies milk to Waitrose. One of the dairy cows in the advert will be wearing a small camera giving customers the opportunity to see the benefits of having access to grazing.

Waitrose said the campaign is in response to the demand it is seeing for quality food and shoppers wanting to be reassured about its provenance.

Rupert Thomas, Marketing Director, Waitrose, commented: “We've always been proud of where our food comes from, and the care and commitment our farmers and suppliers put into producing it. We have never compromised on quality, and never will - but rather than telling customers what we do, we've decided to show them in an open and honest way.”

Further adverts in the campaign will highlight that Waitrose is the only supermarket to guarantee that all its eggs are free-range and that all its fish is responsibly sourced.



Shift Towards Online Grocery Shopping Continuing To Accelerate New research from Mintel reveals that 29% of UK online grocery shoppers are shopping for their groceries more online now than 12 months ago. As a result, online tills are ringing with online grocery sales forecast to reach £9.8bn in 2016, up 13% from an estimated £8.6bn in 2015. Sales are also forecast to grow a further 73% to reach £15bn by 2020.

Mintel found that online-only grocery retailers are particularly benefiting from sofa surfing, with sales increasing 110% from £1.1bn in 2010, to an estimated £2.3bnin 2015. Currently, online grocery shopping accounts for 6% of total grocery sector sales in 2015, up from 3% in 2010.

Today, as many as half (48%) of Brits are current online grocery shoppers. One in ten (11%) do all of their grocery shopping online, with a further 12% doing most of their grocery shopping online. And it is younger consumers that are shunning the supermarket trip: one fifth (19%) of 25-34 year olds now doing all of their grocery shopping online, with 36% of this group shopping for groceries online more often now than 12 months ago.

The main reason consumers cite for shopping online more is convenience, with 60% of Brits who are shopping more online doing so because it is more convenient than visiting stores. This is followed by the fact that online shopping allows consumers to keep better track of how much they’re spending (33%) and the wider variety of delivery slots available (32%).

Nick Carroll, Retail Analyst at Mintel, said: “The online grocery market continues to grow in double digits, but remains small in the context of the wider grocery market. However, the shift away from superstores to more convenient shopping channels is certainly benefiting the market with the majority of consumers now doing some grocery shopping online and almost a third saying that they now shop online more than a year ago. The majority of online shoppers still mix online shopping with store-based shopping, but consumers are becoming increasingly comfortable shopping at online-only retailers with growth outpacing the total market."

However, Mintel found that not all consumers are ditching the trip to the shops, with as many as one quarter (24%) of Brits having never bought groceries online and having no interest in doing so, rising to 38% of over 55s. Additionally, 11% of UK online grocery shoppers are shopping online less now than 12 months ago.

Two fifths (38%) of those who are shopping for groceries online less or who have stopped shopping for groceries online have done so because of the lack of control when choosing fresh products, while one quarter are put off by high delivery charges (26%) or have begun shopping more at discount grocery retailers (25%).

Carroll said: “The lack of control when selecting fresh food and drink products remains one of the biggest issues for online grocery retailing and not one that is easy to address. All of the major players now offer some form of freshness guarantee but this is still not a substitute for picking your own. Inevitably, due to the volume of orders the major retailers now have to process, not all products or orders live up to expectations. Additionally, the discounters have obviously been a disrupting force in the grocery sector for a number of years, and it seems that online grocery retailers are not immune to the impact discounters are having on the market.”

Finally, it seems that consumers are responding to delivery passes from retailers, entitling them to discounted delivery rates. As many as one fifth (21%) of those who shop for online groceries at retailers that offer a delivery pass currently own one and a further 29% don’t, but would be interested in having one in the future.

“As we see Brits turning away from the main weekly shop and towards fluid, when-needed shopping, it is important for online grocery retailers to find a way to engage with these consumers. A wider proliferation of delivery passes may be one way in which retailers can do so as it makes more frequent online grocery shops viable," Carroll concluded.



McCormick Abandons Bid To Buy Premier FoodsShares in Premier Foods were down almost 30% this morning after US group McCormick said that it had decided not to progress with its takeover bid for the UK food manufacturer. .

After making three bids for Premier Foods over recent weeks, McCormick issued a statement today saying that having completed its due diligence review of the business it had concluded it would not be able to propose a price that would be recommended by the Board of Premier Foods while also delivering appropriate returns for its shareholders.

In response, Premier Foods said its Board sees a “strong future for an independent” business, and that the foundations had been laid for “significant growth and shareholder value creation”.

Last month, Japanese noodle maker Nissin Foods bought a 17.3% stake in Premier Foods from private equity firm Warburg Pincus for 63p a share. The deal made Nissin Premier’s largest shareholder and came after the two firms said they had entered “cooperation agreement” which will allow them to distribute each other’s products in their respective markets. However, the agreement was dependent McCormick’s takeover attempt failing to materialise.

Today’s statement from Premier Foods said: “The Board also considers that the company's longer-term prospects will be enhanced by the Co-operation Agreement it has signed with Nissin Foods Holdings Co., Ltd. which will expand Premier Foods' range of growth opportunities.”

McCormick had raised its offer for Premier to 65p a share on 30 March and had until the 20 April to make a firm offer or walk away. Premier Foods had said that McCormick’s offers all undervalued the business and its prospects, although amid mounting pressure from shareholders it recently opened talks with the US group to discuss a possible deal.



Tesco returns to profit as transformation plan delivers Tesco has reported highly encouraging annual results for 2015/16, reflecting significant progress made on all three of its transformation priorities, both in the UK and internationally.

Headline results• Group sales up +0.1% to £48.4bn in year ended 27 February 2016• UK LFL growth of 0.9% in Q4, an acceleration from +0.5% seen at Christmas, with group LFL sales +1.6% in Q4 (13 weeks to 27 February 2016)• UK volumes +3.3% and transactions +2.8% in Q4 with customer satisfaction up +5% in Q4• International volumes up 5.5%• Statutory operating profit of £1.046bn, from a loss of £5.75bn in 2014/15• Net debt cut by £6.2bn, helped by disposals including a contribution from sale of Homeplus in Korea

Delivering against transformation planCommenting on progress CEO Dave Lewis said “We have made significant progress against the priorities we set out in October 2014. We have regained competitiveness in the UK with significantly better service, a simpler range, record levels of availability and lower and more stable prices. Our balance sheet is stronger and we are making good progress in rebuilding trust in Tesco and our investment case.

Our process of transformation has generated broad-based positive momentum in the UK and internationally. We set out to start rebuilding profitability whilst reinvesting in the customer offer, and we have done this. More customers are buying more things more often at Tesco. As a team, we are committed to serving shoppers a little better every day, in what remains a challenging, deflationary and uncertain market. We are confident that the investments we are making are leading to sustainable improvements for customers whilst creating long-term value for our shareholders.”

Regaining competitiveness in the UK• Fixing the UK business has been at the heart of Tesco's recovery strategy and the retailer has made good progress in achieving its aims:• Service has been enhanced through creation of more than 9,000 customer facing roles and operational improvements have driven availability to record

levels• Tesco has made major investments in price, underpinned by the new Tesco Brand Guarantee• Project Reset has been completed across entire range, reducing the number of products offered by 18% and lowering the cost of an average weekly

shop by 3% over the year• 2,000 new products have been introduced, helping to generate positive volume growth for the first time in five years• UK management restructure resulting in 25% reduction in head office roles with more focus shifted to stores• 60 unprofitable stores closed• Private label restructure started with launch of seven new Farms brands

Market challenges remainCommenting on the outlook for the year ahead Tesco said it will continue to invest in its customer offer to improve its competitiveness in a challenging, deflationary and uncertain market and cautioned that this would impact the pace of improvement in profitability, particularly in the first half of the year. However it is confident that its long term progress in making sustainable improvements for customers will lead to a long term recovery in profitability.

Source: IGD 13th April 2016


John Lewis sales up 15.1% last week

John Lewis enjoyed strong trade last week in both in its shops and online.

Sales rose by 15.1% year-on-year although the result was flattered by an extra day's trade compared to the corresponding week last year due to the earlier timing of Easter this year. Home sales climbed by 21.7% boosted by buoyant trade in the textiles and furniture categories.

Electrical and home technology sales rose by 12.7% due in part to the launch of the retailer’s new Smart Home concept at its Oxford Street store and a homepage takeover on johnlewis.com. As a result, Smart Home product sales achieved a 19% uplift compared with the previous week.

Meanwhile, clothing sales continued to be affected by cooler Spring weather, but a good week for beauty and menswear meant the fashion directorate finished the week with sales up 11.4%.

Source: Retail Bulletin 13th April 2016


Colouring books linked to WH Smith's best performance in yearsLike-for-like sales at the WH Smith grew 2% in the six months to the end of February, working against a 2% decline over the same period last year.

The best Christmas in a decade helped with this, as the high street retailer began to turn around years of sales decline. Higher revenues at its airport and rail network outlets, which the chain has been expanding, also boosted profit growth. 757 such outlets now exist, compared with 618 high street stores. Over the half year, WH Smith also opened concessions at Alicante and Dusseldorf airports.

Overall revenues increased 4% with total travel sales up 11% and sales on the high street down 1%.

CEO Stephen Clarke, who joined in 2013, is said to have fixed up the many years of disappointing sales at WH Smith. In turn he was rewarded with a 55% pay rise last year taking his total package to around £4m, including a £550,000 basic salary, £2.5m in long-term share rewards and £783,000 cash.

"The group has delivered a strong first half with both our travel and high street businesses performing well," said Clarke."The travel performance reflects our ongoing investment in the UK business and growing passenger numbers while internationally we have now secured over 200 stores, including our first airport shops in Spain and Germany."

He added that flat like-for-like sales on the high street was the retailer's best performance for many years, accelerated by a strong performance of seasonal products over the five week Christmas period.

"Stationery sales were particularly strong, driven by investment in new product ranges and both our stationery and books business continue to benefit from strong sales in adult activity books, such as colour therapy, extreme dot-to-dot and querkles," added Clarke.

"In March we announced our new exclusive Book Club for young adults headed by the UK's most popular vlogger and bestselling author, Zoe Sugg. The 'Zoella Book Club' will help us to further strengthen our position in a key part of the market."

Source: Retail Gazette 13th April 2016


Positive Q4 trading as Nisa recovery continuesNisa Retail has reported positive trading figures in the 14 weeks to 3 April, reversing the loss incurred in the same quarter last year.

The specialist delivered wholesaler said year-on-year sales were up 4.9% to £327.5m, despite sales deflation of 1.8%.

The company recruited 111 new stores in the period, including 41 in the symbol group and 70 independent/specialist stores.

Nisa Retail chief financial officer Robin Brown said: “2015/16 was a challenging year as the new executive team, strongly supported by all employees, focused on stabilising Nisa while restoring confidence and profitability to the business.

“Considerable credit is also due to our members for remaining loyal throughout the year. Our retail teams have enjoyed a positive year of recruitment, boosted by a pleasing fourth quarter, which is testament to the faith members place in the long term future of Nisa’s mutual model and its unrivalled offer, making Nisa the partner of choice for independent retailers.”

Source: Talking Retail 13th April 2016


Profits Up At House Of Fraser And DebenhamsHouse of Fraser and Debenhams have both reported improvements in profits on the back of robust sales growth.

House of Fraser recorded underlying pre-tax profits of £1.3m in the year to 30 January, which compares to a £2.9m loss in the same period last year. This was its first profit in 10 years and come on the back of strong online trading and refinancing under new owner Sanpower.

Sales on a like-for-like basis rose 4.2% to £1.3bn, helped by a strong performance in menswear and accessories. Online sales jumped 26.8%, although store sales edged up just 0.1%.

The company said it remained “cautiously optimistic” for 2016 despite “challenging trading conditions” weighing on sales.

Chief Executive Nigel Oddy commented: “House of Fraser is pleased to report positive sales and margin growth over the full year. This was driven by continued progress across both our online and bricks and mortar stores, despite the volatile trading environment in the final quarter of fiscal year 2016.

“Looking ahead, whilst mindful of ongoing uncertainty around the EU referendum and the challenging market conditions experienced across the retail industry since the beginning of 2016, we remain cautiously optimistic and believe we are well positioned to deliver further growth in the year ahead.”

Meanwhile, rival department store Debenhams has posted a 5.5% rise in half year pre-tax profits to £93.8m. Group like-for-like sales were up 1.1% with Chief Executive Michael Sharp saying: "A strong operational performance resulted in a record Christmas, and further growth in first half profits against a good performance in the prior year. Our customers are responding positively to our multi-channel strategy, finding our mix of products and brands both compelling and great value for money."

Sharp, who plans to step down this year, said the company was on track to deliver full year results in line with market expectations.



Underlying Sales Improve At Unilever Despite ‘Challenging’ Trading ConditionsUnilever’s underlying sales rose 4.7% in its first quarter with emerging markets growing 8.3%. Underlying volume growth was 2.6%, although turnover declined 2.0% to €12.5bn as a result of weaker currencies in various markets.

Despite the robust performance, the consumer goods giant warned that markets around the world remained challenging with consumer demand described as “fragile”. It said that volume growth had slowed further, with market growth weak in emerging markets, negligible in North America and negative in Europe.

Beset by deflation, underlying sales in Europe were down 0.6%. Sales in The Americas were up 8.5%, whilst Asia/AMET/RUB saw growth of 5%.

Its Home Care division was the star performer with underlying sales up 7%, whilst Personal Care grew 5.8% and food sales rose 1.9%.

Chief Executive Paul Polman commented: "The first quarter demonstrates a strong volume-driven performance, following on from a good delivery in 2015. We are maintaining momentum despite a tougher external environment, with all four categories gaining market share. This broad-based growth, including over 8% in emerging markets, shows the validity of our strategy, portfolio management and a step-up in innovation.

“With markets remaining volatile, we continue to focus on driving agility and resilience in our business through the key programmes which we set out at the end of last year: net revenue management, zero based budgeting and the next stage in our continued organisational transformation. This will position us well to deliver another year of volume-driven growth ahead of our markets, steady improvement in core operating margin and strong cash flow.”



Like-For-Like Sales Down At Poundland Amid Tough Trading ConditionsPoundland has revealed that its like-for-like sales slipped 4.9% during the second half of its financial year to 27 March, impacted by “difficult market conditions” and disruption from its 99p Stores’ conversion programme. .

In final quarter of the year, total sales increased by 29.8% to £330.8m, benefiting from the addition of the 99p Stores' portfolio. Total sales for the year as a whole were up 17.9% to £1.31bn, whilst like-for-like sales fell 3.9%.

The group said it had converted 190 of the 99p Stores to the Poundland format by the end of Q4 with the programme expected to be completed by the end of April. It added that it had seen strong sales growth generated in converted stores and that it was track to deliver targeted incremental annual EBITDA of at least £25m.

Including new store openings, the acquired 99p Stores estate and Spain, Poundland has added 336 stores to its store portfolio over the last 12 months, increasing its estate by 57%. It ended the year with 906 stores including 843 stores in the UK, 53 stores in Ireland and 10 stores in Spain. Poundland said it was on track to broadly meet market expectations for full-year profit, adding that it had managed its margin and costs well.

Chief Executive Jim McCarthy said: "Against a tough retail background, this has been a transformative year for Poundland, strengthening further our position as Europe's biggest single-price discounter. We have added over 300 shops to our portfolio in the UK & Ireland, in particular in the South of England, substantially increasing our geographical reach and scale.

"The 99p Stores' conversion programme will complete by the end of April, at which point we expect to see the significant benefits of over 900 stores trading as one cohesive retail operation begin to materialise."

McCarthy is due to step down later this year after ten years in charge of the discount chain. He will be replaced by Kevin O'Byrne in July, the former CEO of B&Q.



Waitrose Still UK’s Best Loved Supermarket Chain, With Aldi Coming Second Ahead Of M&SThe increasing popularity of discounters over traditional supermarkets has again been highlighted in a consumer study by Market Force Information. Whilst Waitrose unsurprisingly topped its ranking of the UK’s best loved supermarket chain, Aldi overtook Marks & Spencer to take second place.

The Market Force Information study asked more than 6,648 UK consumers to rate how satisfied they were with their last experience at a supermarket and how likely they would be to recommend it to others. The data was averaged to rate each brand on a Composite Loyalty Index which benchmarks overall satisfaction and likelihood to recommend.

The study also identified the key qualities that drive satisfaction, revealing the ways in which supermarkets can win and retain customers without resorting to price wars. Overall, one in ten people were dissatisfied with their last grocery shopping experience.

While Waitrose remained the nation’s favourite, Aldi leapfrogged M&S into second place with Sainsbury’s and Morrisons claiming the fourth and fifth spots respectively. According to the research, Tesco was the only supermarket to improve on its 2015 score, increasing by two percentage points.

Cheryl Flink, Chief Strategy Officer for Market Force Information, said: “Clearly premium brands are winning the war for customer’s hearts, but Aldi’s entry into the top two shows how discounter chains are stealing market share from conventional supermarkets by delivering extremely well on value.”

Shoppers rated supermarkets on six satisfaction drivers, including cashier courtesy and item availability. Waitrose leads the way in nearly all customer metrics, with Aldi taking the top spot in the checkout speed category. Competition was stiff across the board, with five brands competing for 2nd and 3rd place across the six satisfaction drivers.

Satisfaction with “availability of items” and “service provided in speciality departments” received the lowest average ratings, offering a clear indication of opportunities for supermarkets to differentiate and improve.

Flink commented: “In a notoriously tight sector characterised by ferocious price wars, our research shows that it is also possible to win market share by offering a better experience and by zeroing in on the exact factors that matter to customers.”


Macroview Weekly News updateYour window on the latest trends in Packaged Groceries

Stephen Hall

Friday 15th April