Discounters are benefitting the most from the cost-of-living crisis, with their low cost and quality credentials appealing to consumers who are shifting their shopping habits to help cope with inflation, says GlobalData.
According to the leading data and analytics company, Aldi’s UK grocery market share is forecast to grow 0.3ppts to 7.1% in 2022, meaning the discounter will take Morrisons’ spot in the Big Four as its share is set to fall 0.9ppts to 7.0%.
GlobalData forecasts that there will be an 11.7% price inflation in the grocery market this year. When the company asked UK shoppers how they would react to food & grocery price rises, 14% said they would switch to a cheaper retailer, and of those, 37% said they would switch to Aldi, the equivalent of over three million consumers*.
Amira Freyer-Elgendy, Food & Grocery Analyst at GlobalData, comments: “Aldi will gain share in 2022 due to improved loyalty and bigger baskets from existing customers and the acquisition of 3.1 million shoppers switching from rivals. This figure doesn’t even account for the new customers it will gain from the 16 new stores it plans to open by the end of the year.”
Following Morrisons’ results last Wednesday, it is now clear that it will lose its fourth-place position in the UK grocery market this year. While discounters such as Aldi and Lidl are attracting 70% of all switchers, the likes of Sainsbury’s, Asda, and Morrisons are witnessing shopper desertion.
Freyer-Elgendy adds: “Morrisons’ latest announcement that it will slash prices on 150 items will go some way in protecting shopper loyalty, particularly as most consumers prefer to trade down within their usual supermarket rather than switch; however, its reaction to the crisis has been slower than its rivals. As a result, Morrisons will feel the squeeze from Aldi even more so as we move through H2 as more consumers search for value in response to tighter household budgets.”
*Data taken from GlobalData’s survey of 2,000 nationally representative UK consumers aged 16+ conducted in August 2022
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