A combination of inflation and a high level of promotions by retailers is helping to keep grocery sales up on last year, according to new research.
Data from market analyst group Nielsen shows that year-on-year grocery market growth for the four weeks to May 14th 2011 was seven per cent in terms of value, while unit growth was two per cent.
Nielsen’s Scantrack Grocery Multiples tool showed that sales during the week ending April 23rd were up 19 per cent on the equivalent period last year, with the summer weather and bank holidays encouraging people to spend, but then trading tailed off thereafter.
The research comes after Kantar Worldpanel data, released yesterday, indicated that the grocery market grew by 4.8 per cent in the 12 weeks to May 15th following slower growth reported earlier in the year.
Mike Watkins, Senior Manager, Retailer Services at Nielsen, stated: “Shoppers enjoyed a spending spree at food retailers as a result of the early summer weather, and the country was in the mood to celebrate the double bank holiday.
“Unfortunately this left a spending hangover and shoppers drew back spending quite dramatically thereafter, with sales over royal wedding week being unremarkable.”
Watkins added that by the second week in May trading growth fell back to a sluggish four per cent, with the value of promotional spend remaining at around 40 per cent of overall grocery sales.
“Shoppers continue to be fickle and it’s the combination of inflation and the ongoing high level of promotions that are helping to keep spend per visit higher than this time last year.”