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Horse Meat Scare Shifts Consumer Patterns

05 March 2013

UK/IRELAND - The latest grocery share figures from Kantar Worldpanel, for the 12 weeks ending 17 February, reveal that the impact of the first five weeks of the horsemeat scandal, which broke on 16 January, was on what people bought rather than where they bought it.

Edward Garner, director at Kantar Worldpanel, said: “The issue has so far only affected the performance of individual markets rather than where consumers are choosing to shop. For the four weeks ending 17 February, frozen burger sales were down by 43 per cent and frozen ready meals declined by 13 per cent, clearly demonstrating a change in shopping habits.

“Tesco’s share has come under pressure this period, with a drop from 30.1 per cent a year ago to 29.7 per cent now. It might seem natural to attribute this decline to the horsemeat contamination; however, Tesco undertook heavy promotions this time last year, where consumers received a £5 voucher when they spent £40, and not repeating this offer will have adversely affected its share.”

Within the big four, Sainsbury’s is the only retailer to increase share this period, beating the market with a 4.6 per cent growth rate. Morrisons is the only retailer to post a sales decline.

Edward continues: “Waitrose and Aldi deliver all-time record shares this period of 4.8 per cent and 3.3 per cent respectively indicating that market polarisation and the ‘two nations’ consumer climate continues. Iceland records 10.1 per cent growth confirming that the frozen food category as a whole remains robust.”

The total grocery market is growing at an annual rate of 3.7 per cent which lags behind grocery price inflation of 4.3 per cent. This confirms the continued pressure on shoppers who are using coping strategies to reduce their personal inflation rate.

In Ireland, the survey showed that the horse meat contamination scare shifted shopper habits.

David Berry, commercial director at Kantar Worldpanel, said of the situation in Ireland: “The impact of the horse meat issue has so far only affected what consumers put in their baskets rather than where they do their shopping. For the four weeks ending 17 February frozen burger sales were down by 42 per cent as shoppers chose to buy alternative meals.

“Aldi continues to set the pace with sales growth of 29 per cent, increasing its share of the market from 4.6 per cent last year to 5.9 per cent. What is notable from Aldi’s performance is that it has grown sales of fruit and vegetables – the most valuable grocery category – by 39 per cent this year.

“Among the big three supermarkets Dunnes is the only grocer to increase its share of the market. Benefitting from bigger shopping baskets, the retailer beat the market with 4.1 per cent sales growth. Tesco’s performance has improved slightly since January but still remains behind the market, leading to a drop in market share for the second successive period.”

The 0.8 per cent growth seen in the market is the highest level since December 2011 and is attributable to the continued increase in the price of groceries.

Grocery inflation in Ireland stands at 5.8 per cent for the 12 week period ending 17 February 2013, the highest level seen since the 6.2 per cent seen in September 2008.

This figure is based on over 30,000 identical products compared year-on-year in the proportions purchased by Irish shoppers and therefore represents the most authoritative figure currently available. It is a ‘pure’ inflation measure in that shopping behaviour is held constant between the two comparison periods – shoppers are likely to achieve a lower personal inflation rate if they trade down or seek out more offers.

Further Reading

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