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Shoppers head to Aldi and Lidl as grocery price inflation surges

// Shoppers are turning to discount retailers and own brand products in a bid to soften the blow of roaring inflation
// Own label products now account for 50.6% of all spending – up from 49.9% last year

Shoppers are turning to cheaper own-brand food products and discount retailers like Aldi and Lidl as they battle grocery price inflation, new data reveals.

As households brace for a cost of living crunch this spring, the cost of groceries is now 5.2% higher than it was a year ago, with inflation in the past month hitting its highest level in nearly a decade, figures from Kantar reveal.

Own label products now account for 50.6% of all spending, an increase on 49.9% last year.

Customers are also making fewer trips to stores to save on petrol costs while prices are rising fastest in markets including savoury snacks, dog food and cat food, with jumps not seen since April 2012.

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Aldi and Lidl both remained the fastest-growing supermarkets over the past few months, with both seeing sales rise3.6% over the 12 weeks compared with a year ago.

This pushed Aldi to its biggest market share in the UK to date, with 8.6%. The retailer also managed to successfully attract older customers this month, with a 16% rise in those aged over 55 buying from the budget supermarket.

Lidl’s market share hit 6.4%, Kantar said, while he hardest-hit supermarkets were Asda and Morrisons, which saw sales drop 9.9% and 11.5% respectively, denting their market share.

The data company also revealed that, with life returning to normal post pandemic, shoppers are eating out more – especially among commuters who are now returning to office.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: “More and more we’re going to see consumers and retailers take action to manage the growing cost of grocery baskets. Consumers are increasingly turning to own label products, which are usually cheaper than branded alternatives.”

“Meanwhile the grocers are also adapting their pricing strategies in response to the rising cost of goods.

“One trend we’re already tracking is the move away from selling products at ‘round pound’ prices. The percentage of packs sold at either £1, £2 or £3 has dropped significantly from 18.2% last year to 15.9% this March.”

McKevitt added: ‘It’s no surprise that sales are down over the latest period as consumers are now more confident eating out of the home again.

“As well as enjoying meals out with friends and families, people will have also been grabbing food and drink on the go from supermarkets while travelling or at work.”

“Those sales aren’t included in these take-home figures, but they will be adding to the grocers’ overall performance. What we’re really starting to see is the switch from the pandemic being the dominant factor driving our shopping behaviour towards the growing impact of inflation, as the cost of living becomes the bigger issue on consumers’ minds.”

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