LONDON: The UK's leading supermarket chains have switched their attention from matching the prices of their rivals to improving the quality of their private label ranges and positioning them against leading brands, new data has shown.
Latest figures from Kantar Worldpanel, covering the 12 weeks ending 7th July 2013, indicated that consumers were shopping around less, as many felt they would get the same prices at different retailers.
"As a result we are seeing an increased focus on quality," observed Edward Garner, director at Kantar Worldpanel.
"Both Tesco Finest and Sainsbury's 'Taste the Difference' ranges are now growing strongly and Aldi's 'Like Brands only Cheaper' campaign and Lidl's 'Taste Test' are positioning their private products as direct competitors to major brands," he stated.
Another aspect of the market highlighted by Kantar Worldpanel was the polarisation evident as discount and upmarket retail brands were growing faster than the industry overall.
Waitrose, Aldi and Lidl now accounted for 11.5% of the grocery market compared to 8.3% four years ago. "This trend has cut deeply into the available market share for the bigger retailers who are now having to compete for a contracting middle ground," noted Garner.
Among the big four supermarkets – Tesco, Sainsbury's, Morrisons and Asda – only Sainsbury's did not lose share in the past year with year-on-year growth of 3.8%.
One factor in Sainsbury's success has been its rapid move into convenience stores, one of the fastest-growing parts of the market. It currently has 591 supermarkets and 541 smaller Sainsbury's Local outlets, but it is opening Local stores at the rate of two a week and expects them to outnumber supermarkets by the end of the year, the Daily Telegraph reported.
Elsewhere, Kantar Retail has remarked on the fragmentation of grocery shopping trips into more frequent, lower-value baskets and argued that "proximity has become a key attribute for retailers" as time constraints and rising petrol prices reduce the attractions of the out-of-town hypermarket.
Data sourced from Kantar Worldpanel, Daily Telegraph; additional content by Warc