Aldi and Lidl combined now account for 10 per cent of UK grocery market

The two grocers have stolen market share from the more established supermarkets in a short period of time. Just three years ago, their combined market share was five per cent reports CityAM

Aldi’s market share stands at 5.6 per cent – where it has remained for five consecutive months – while Lidl has reached a record high of 4.4 per cent, according to Kantar Worldpanel.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: “In the last 12 weeks the two retailers have attracted another additional million shoppers compared with last year while average spend per trip has increased by four per cent to £18.85, which is 78p ahead of the total retailer average. The discounters show no sign of stopping and with plans to open hundreds of stores between them, they’ll noticeably widen their reach to the British population.”

Their growth comes at a time when the rest of the sector is struggling. Sales in the 12 weeks to 8 November rose just 0.5 per cent, despite the launch of a series of high profile Christmas adverts. And grocery deflation is not helping, with prices dropping 1.7 per cent in the 12 week period.

Tesco and Asda fared the worst, with spend falling 2.5 per cent and 3.5 per cent respectively. Morrisons also registered declines, albeit at a lower rate of 1.7 per cent.

Sainsbury’s was the only one of the big four in growth, up 1.5 per cent for the three months.

McKevitt said: “Sainsbury’s has seen its fourth consecutive period of growth, flying in the face of tough market conditions. It’s 1.5 per cent increase in sales was sufficiently ahead of the market for the retailer to increase its share by 0.2 percentage points – the first share gain registered by any of the ‘big four’ retailers since October 2014.

“Sainsbury’s performance means it has once again regained its position as Britain’s second largest supermarket, pushing ahead of Asda in the latest 12 weeks. The food-focused retailer traditionally increases its market share over Christmas, so we can expect to see it keep hold of second place for the time being.”

Nielsen, which released its figures on the same day, painted a similar picture of the state of the sector.

Total sales for the four weeks to 7 November dropped 1.2 per cent, while volume dropped 0.5 per cent. Tesco and Morrison’s sales were down 1.8 per cent apiece, but Asda fell an even greater 4.7 per cent.

Sainsbury’s sales grew 0.4 per cent, but this was dwarfed by the increases made by Aldi and Lidl, up 27.5 per cent and 21.7 per cent respectively.

Nielsen’s UK head of retailer and business insight Mike Watkins said: “The rise of the discounters seems to have hit Tesco, Asda and Morrisons the hardest. Their combined market share over the last year is down 2.1 per cent, the exact figure the discounters’ has risen.”