The latest data on the Irish grocery market shows that sales fell by 6.5% in the 12 weeks up to May 15, as shoppers adjust to rising prices through inflation.
According to market data analysis firm Kantar, grocery inflation hit 5.5% in that period, marking the first time inflation has risen above 5% since August 2013.
“Food and drink prices are continuing to climb, and the impact of this on grocery budgets is now unavoidable for many people,” said David Berry, managing director for Kantar Worldpanel Ireland.
“Our research shows that the rising cost of living is a key concern for 81% of Irish consumers. A staggering 62% expect that they will have to cut back on the amount of food they buy in response to current prices.
“We’ll be seeing the effects of inflation for months to come,” Berry warned.
As a result of this, shoppers are changing their behaviour to manage the cost of buying food, including by turning to cheaper alternatives.
Berry pointed out that people are making fewer trips to the supermarket on average per month than they were this time last year. Furthermore, branded items – a “firm favourite” during Covid-19 lockdowns – are losing ground to retailer-own brands, which are typically less expensive.
As a result, brands’ share of grocery spend has dropped to 49% in the latest 12 weeks of Kantar’s figures, equivalent to a €29 million drop off.
The latest figures also highlight that, despite the pressure of price inflation, shoppers are nonetheless preparing for summer.
“Shoppers have been enjoying barbecue essentials as the June bank holiday edges closer. Sales of ‘BBQ’ meats, like burgers and sausages, and prepared salads have increased by 2% and 8% respectively in the latest 12-week period. Soft drinks have also seen a 5% boost this period, equating to an extra €5 million through the tills,” Berry pointed out.
He added: “It’s likely that sales of these items will keep rising as we make the shift to more summery foods and leave the soups and stews behind, but prices are going up too.
“A trip to the supermarket to buy BBQ meat, salad and soft drinks will now cost you €1 more on average, in total, than it would have last year.
In terms of the standings for the individual retailers, Dunnes has retained its position as Ireland’s number one retailer and holds a 22.3% share of the market.
This was followed by Tesco with 21.9%; SuperValu with 21.7%; Lidl with 13.1%; Aldi with 12.2%; and ‘other’ outlets with 8.8%.
Berry pointed out: “Sales among all the retailers are still in decline compared to lockdown last year, when people were far more reliant on supermarkets to stock up their cupboards.
“That said, Dunnes seems to be recovering well from the challenging Covid-19 period. The retailer’s current market share is 1.2% points higher than in May 2021, boosted by 98,000 new shoppers in the latest 12-week period.”
Tesco, meanwhile, benefitted from shoppers visiting its stores more often, bucking the general market trend.