Grocery inflation is at 16.4% for the latest 12 weeks (19/02/23) according to the latest data from Kantar Ireland, who monitor the household purchasing habits of 5,000 households. UK grocery inflation has surpassed Ireland which currently stands at 17.1%.
Inflation is the key driver of growth within the market as volume per trip fell by 10.9%. Shoppers are manging inflation through shopping little and often, as frequency is up 7% writes Stephanie Walsh, Food Business Consultant with ifac.
The latest 12 weeks to 19th February 2023 saw grocery sales increase by 8.5%. Shoppers spent an additional €113.56 per buyer compared to the same period last year. In January shoppers spent an additional €90.50 year-on-year.
Valentines Day and Pancake Tuesday at home
Despite price pressures, shoppers continued to celebrate both Valentines Day and Pancake Tuesday but at home. Turnover increased in categories that play into these celebrations. Shoppers spent an additional €3.8m on chilled ready meals, €1.5m on chilled desserts and €1.2m on wine. Unsurprisingly the period saw a significant increase in the amount spent on gifting chocolate, with shoppers spending an additional €326,000. Pancake Tuesday saw sales of flour, eggs, butter and chocolate spread up 11.9%, 29.6%, 19.5% and 55.5% respectively.
Dunnes Stores holds top position
The average growth year-on-year for the total multiples is 9.2%, all retailers saw growth in the 12 weeks to 19thFebruary. Dunnes have the top place in the retail market with 23.6% with a 12.3% growth year-on-year. Dunnes have the strongest year-on-year growth of 12.3%.
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Key insights for a food and drink producer
The importance of own label products
Own label products continue to show strong growth. Shoppers continue to trade down to own label products with sales rising 11.9% compared to brands which grew at 6.1%. Value own label products saw the strongest growth and is up 35.8% year-on-year. Inflationary pressures are impacting consumers habits and buying decisions. It is essential to review your product positioning within the market.
Online sales continued to grow with a 5.2% increase year-on-year. Kantar highlight that “nearly 18% of Irish households purchasing online”. This route to market is growing and should be reviewed as part of your retail strategy to ensure continued success within your business. If you currently have an online presence, its essential review your website, is it fit for purpose? Is it easy for potential customers to purchase products?
Occasion at home
As inflation continues, the trend of eating at home remains buoyant. It is essential to review your products position for at home eating. The opportunity for food and drink producers is to tap into the social eating moments. Review your branding and marketing to ensure it showcases the consumption moments addressed by your product. Can you bundle your products for takeaway nights? Can you introduce more indulgent flavours? Do you need to share more recipes to include and showcase your product?