Marks & Spencer has maintained its position as UK’s fastest growing food retailer, market researcher NielsenIQ said today, indicating its turnaround plan is gaining momentum.
It said M&S’s sales rose 12.3 per cent in the 12 weeks to January 29 year-on-year, giving it a market share of 3.6 per cent, up 0.4 percentage points on the year.
It comes after luxury supermarket M&S boosted its profit outlook last month after it reported a strong Christmas, with food sales continuing to outperform.
As Ross Hindle at Third Bridge told City A.M.:”M&S was a big beneficiary of Britain’s appetite for at home luxury as consumers sought to make the best of another Covid Christmas. A well executed restructuring programme aided the Group’s performance as did the partnership with Ocado.”
Meanwhile, market leader Tesco was the best performer of the Big Four grocers, with its 0.3 per cent sales decline still significantly outperforming Sainsbury’s, Asda and Morrisons, which had falls of 3.7 per cent, 4.3 per cent and 6.9 per cent respectively.
NielsenIQ said overall UK supermarket sales fell 2.9 per cent over the four weeks to January 29.
January led shoppers to reset on their shopping habits, with many shoppers spending less on categories that were popular during the lockdown periods, such as beers, wines and spirits (down 14.2 per cent), frozen foods (down 11 per cent) and packaged grocery (down 8.3 per cent).
As more ‘normal’ lifestyles returned, with students returning to school and workers back in the office, there was also strong growth in delicatessen and health and beauty for instance.
However, as Mike Watkins, NielsenIQ’s UK Head of Retailer and Business Insight, said: “January is also traditionally a month where shoppers are keen to keep household costs low, and along with the added convenience of online shopping, consumers have the opportunity to shop savvy by editing previous shopping lists, searching for lower cost alternatives, and managing the total ‘checkout’ spend if they are looking to economise when shopping for groceries online.”
As such, Watkins warned that total till growth is likely to keep declining throughout the first quarter of this year before returning to growth by Easter.
Nonetheless, comparatives continue to be difficult to make to previous years, with the UK in full lockdown in 2021, where sales grew 10.6 per cent.
Russ Mould, investment director at AJ Bell, commented on the data and told City A.M.: “A bigger test may lie ahead after April, once higher energy bills, national insurance contributions, council tax bills and ongoing inflation all come into play but for now the food arm is doing its bit in the ongoing turnaround under Steve Rowe and Archie Norman.”