UK grocery market outlook abridged version

Transcription

1 UK grocery market outlook abridged version Laura Jacobson Strategic Senior Retail Analyst IGD 2018

2 UK grocery market: which channels are best placed to win? Overview of key players IGD 2018 Page 2

3 Grocery retail market size ( bn) YOY Growh (%) Inflation will drive growth in UK grocery % % 8% 7% 150 6% 5% % 3.5% 2.3% 2.7% 3.2% 3.1% 2.9% 2.5% 4% 3% % 2.1% 2.2% 1.2% 1.8% 2.1% 1.4% 0.4% 0.6% Market value ( bn) YOY % Change June 2016 forecast % Change 2% 1% 0% Source: IGD UK Grocery Channel Forecasts 2017 IGD 2018 Page 3

4 Momentum is with convenience, discount and online 60% % 46.60% 40% 42.80% 30% 20% 21.70% 22.10% 14.10% 10% 8.80% 7.70% 10.90% 5.60% 7.50% 6.40% 5.70% 0% Hypermarkets Supermarkets Convenience Discount Online Other Source: IGD UK Grocery Channel Forecasts 2017 IGD 2018 Page 4

5 bn value growth Top three growth channels will deliver 23bn sales 12 Discount bn 8 6 Supermarkets Convenience 7.1bn Online 5.6bn 4 2 Hypermarkets - -10% 0% 10% 20% 30% 40% 50% 60% 70% - 2 % sales growth IGD 2018 Source: IGD channel forecasts 2017 Page 5

6 Larger format stores: evolution not revolution Re-thinking space Getting the range right Focus on fresh food: for now and for later 65% % shoppers who found their last larger store visit an enjoyable shopping experience IGD 2018 Source: IGD ShopperVista Research Base: 1,025 All Convenience store shoppers, Sep-Nov 17 Page 6

7 Convenience: appealing to customer needs Increasing participation from new generations of shoppers Speed of in-store experience Targeting more missions, more effectively 47% % shoppers who purchased any products on impulse on last visit to a c-store IGD 2018 Source: IGD ShopperVista Research Base: 1,025 All Convenience store shoppers, Sep-Nov 17 Page 7

8 Discount: new stores and new look Expanding store networks Improving in quality, staying low on price Strengthening brand affinity 79% % shoppers who were satisfied with the choice of products at discounters on their last trip IGD 2018 Source: IGD ShopperVista Research Base: 1,700+ ALL Shoppers, December 17 Page 8

9 Online: innovating with more convenient solutions Faster fulfilment More flexibility The emergence of voice ordering 46% % shoppers choose online vs. instore because it s more convenient/easier IGD 2018 Source: IGD Research,, IGD Shopper Vista, Base: 1,035 British online grocery shoppers; May-Jul 17 Image: retailer website Page 9

10 UK grocery market: which channels are best placed to win? Overview of key players IGD 2018 Page 10

11 Big Four lead on market share Other IGD 2018 Source: Kantar Worldpanel, 12 weeks to 31 Dec 2017 Page 11

12 Value sales growth % Discounters continue to grow fastest Aldi Lidl Ocado Tesco Iceland Waitrose Asda Morrisons Sainsbury's Co-op IGD 2018 Source: Kantar Worldpanel, 12 weeks to 31 Dec 2017 Page 12

13 Whilst performing is converging at the multiples Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Asda M&S Morrisons Sainsbury's Tesco Source: Retailers. Note reporting periods vary and are detailed on the next slide. Sainsbury s LFL includes Argos and Habitat from Q Morrisons includes contribution from wholesale IGD 2018 Source: Retailers. Note reporting periods vary and are detailed on the next slide. Sainsbury s LFL includes Argos and Habitat from Q Morrisons includes contribution from wholesale Page 13

14 Big Four: Tesco 3,585 stores 42.5bn sales Serving shoppers a little better every day IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 14

15 Big Four: Sainsbury s 2,229 UK stores 26.2bn UK sales Live Well for Less IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 15

16 Big Four: Asda 631 UK stores 21.7bn UK sales Save money. Live better IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 16

17 Big Four: Morrisons 506 UK stores 16.4bn UK sales Morrisons makes it IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 17

18 Food discounters: Aldi 696 UK stores 7.5bn UK sales Every day amazing IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 18

19 Food discounters: Lidl 670 UK stores 5.3bn UK sales Big on quality, Lidl on price IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 19

20 Premium grocers: Waitrose 360 UK stores 6.2bn UK sales 'Everyone deserves quality food. Everyone deserves Waitrose IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 20

21 Premium grocers: Marks and Spencer 939 UK grocery stores 6.8bn UK grocery sales Spend it well IGD 2018 Source IGD Research Data: IGD Datacentre, full year 2016 Page 21

22 Want to know more? Laura Jacobson Senior Strategic Retail Analyst, UK Gavin Rothwell Head of Food to Go and Retail Safaris Phone: +44 (0) Phone: +44 (0) Study Tours Retail Analysis Customised solutions Understand what key retail trends mean for your business. IGD market experts will lead your programme of visits, sharing our market and retailer knowledge. Access the latest reports on retailer strategies, trends store concepts on the Retail Analysis website. We're constantly analysing, forecasting and commenting on the opportunities and challenges facing the grocery industry, around the world. If you have a specific business challenge or training requirement we can put together something just for you.

23 IGD s Retail Safaris A fully-customisable study tour experience, led by IGD, to the most relevant and inspiring store formats globally. This year, we will facilitate over 20 study tours across Europe and North America. We can work with you and your team, or retail partners, to build a customised programme of store visits. Sessions can last from 0.5 to six days, working with groups from five to 50 delegates. Our tours: Provide inspiration for new format and category concepts Help you spot new ideas you can go ahead and implement quickly Enable you to build intelligence around the key trends and get to grips with the latest retail innovations Encourage conversations back in your business around longer term changes Help you solve specific business challenges We can select the most relevant stores based on extensive local market knowledge Optimise our established retailer networks for authorised store visits Create the opportunity to meet other retailers Facilitated de-brief sessions to maximise learnings On the ground support of IGD analysts, enabling you to focus on the study tour, not logistics Click here to learn more about our programs and how we can support your business. Contact our team for more details. For cities in Europe: Gavin.Rothwell@igd.com For cities in North America: Stewart.Samuel@igd.com IGD 2018 Page 23

24 Disclaimer IGD No part of this presentation may be reproduced or transmitted without the prior permission of IGD. Whilst every effort has been made to ensure that the information contained in this presentation is correct, neither IGD nor any of its staff shall be liable for errors or omissions however caused. The client is referred to IGD s customised research terms and conditions ( for further details. The client is responsible for managing all aspects of their businesses, including whether they wish to rely on, implement or act on any recommended next steps. IGD 2017 Source IGD Research Page 24