Despite the gloomy economic news, and reports of plummeting consumer confidence, people still seem ready to spend on premium quality food.
Kantar Worldpanel, the market data company, tells us that overall grocery sales grew by 5% in the 12 weeks to 26th December 2010, but that sales of premium own label across the 4 big supermarkets grew by 11%, over twice as fast. The Kantar data also shows us that the so called upmarket grocers are doing best, with Sainsbury, Waitrose and Marks and Spencer gaining share whilst low priced ASDA and Morrisons lost share and Tesco only managed to stand still.
Reporting on their performance Sainsbury, who spent nearly £1 billion revamping their premium Taste the Difference Range, said sales of higher priced and ethically sourced products were growing fast, citing free range turkey sales up 30% and smoked salmon up 16%.
Marks and Spencer also mentioned booming sales of turkeys and smoked salmon, whilst Tesco confirmed the trend towards premium food, with sales of “Finest” ham on the bone up 50%, “Finest” party foods up 90% and “Finest” wines up 100%.
Less spectacular, but nevertheless welcome, beef sales in the 12 weeks to end December grew by 4% in both volume and value after months of virtually static sales.
Kantar Worldpanel, the market data company, tells us that overall grocery sales grew by 5% in the 12 weeks to 26th December 2010, but that sales of premium own label across the 4 big supermarkets grew by 11%, over twice as fast. The Kantar data also shows us that the so called upmarket grocers are doing best, with Sainsbury, Waitrose and Marks and Spencer gaining share whilst low priced ASDA and Morrisons lost share and Tesco only managed to stand still.
Reporting on their performance Sainsbury, who spent nearly £1 billion revamping their premium Taste the Difference Range, said sales of higher priced and ethically sourced products were growing fast, citing free range turkey sales up 30% and smoked salmon up 16%.
Marks and Spencer also mentioned booming sales of turkeys and smoked salmon, whilst Tesco confirmed the trend towards premium food, with sales of “Finest” ham on the bone up 50%, “Finest” party foods up 90% and “Finest” wines up 100%.
Less spectacular, but nevertheless welcome, beef sales in the 12 weeks to end December grew by 4% in both volume and value after months of virtually static sales.
Undoubtedly there will be a Christmas effect in these numbers. Shoppers traditionally splash out during the festive season. But these are comparable figures with Christmas last year, and presumably people were feeling festive then, so the big growth in premium sales does seem to be a trend rather than a one off.
Whether the trend will continue is another question, as the effects of government cuts put further pressure on disposable incomes.
The difference between now and a couple of years ago when the credit crunch first happened and shoppers flocked to discount supermarkets and grocery value ranges is that then, the worry of economic hardship was greater than the reality. The reality now is that money will become tighter, and we may yet see down trading in food. On the other hand it could be that people have tried the value route and it does not meet their needs, at least all of the time.
The Institute of Grocery Distribution is of the view that shoppers will not trade down if it means compromising on quality or values. Rather, people will be more careful about how they shop and prepare food. 36% of us are already trying to reduce food and packaging waste, say the IGD, and 22% are going back to a simpler diet, cooking uncomplicated meals and cutting out unnecessary add ons. This perhaps means higher sales of top quality staple foods.
One high priced staple that shows no sign of growing is lamb. In the 12 weeks to end December 2010, lamb consumption dropped by 17% in volume and 6% in value. It is no good arguing that Christmas is not a big lamb eating time. The point is that these figures are compared with the same period in 2009, The only conclusion to be drawn is that the lamb eating experience does not justify its high price, and that lamb is becoming less and less relevant to the meat eating public.
The difference between now and a couple of years ago when the credit crunch first happened and shoppers flocked to discount supermarkets and grocery value ranges is that then, the worry of economic hardship was greater than the reality. The reality now is that money will become tighter, and we may yet see down trading in food. On the other hand it could be that people have tried the value route and it does not meet their needs, at least all of the time.
The Institute of Grocery Distribution is of the view that shoppers will not trade down if it means compromising on quality or values. Rather, people will be more careful about how they shop and prepare food. 36% of us are already trying to reduce food and packaging waste, say the IGD, and 22% are going back to a simpler diet, cooking uncomplicated meals and cutting out unnecessary add ons. This perhaps means higher sales of top quality staple foods.
One high priced staple that shows no sign of growing is lamb. In the 12 weeks to end December 2010, lamb consumption dropped by 17% in volume and 6% in value. It is no good arguing that Christmas is not a big lamb eating time. The point is that these figures are compared with the same period in 2009, The only conclusion to be drawn is that the lamb eating experience does not justify its high price, and that lamb is becoming less and less relevant to the meat eating public.
2 comments:
It seems that quality food is an affordable luxury. We don't want to spend the money to eat out, so many of us have brushed up our cooking skills and found that with the right level of technique, and a small investment in quality ingredients, we can have a pretty good time in our own dining rooms!
Yes, one of the side effects of difficult economic times is that more people are cooking from scratch.It may mean a healthier as well as better tasting diet.
Post a Comment