Paul Stainton’s Post

🛒 Unlocking Growth: Strategies for New Entrants in the Grocery Market 🚀 With the latest data revealing Tesco's resurgence and Ocado's online growth, it’s clear the UK grocery sector remains competitive. For new players aiming to disrupt this landscape, success will depend on innovation, agility, and customer-centric strategies. Here’s how new entrants can gain a foothold: 1. Data-Driven Personalization🔍 Leverage AI and advanced analytics to create personalized shopping experiences. Tailored offers and product recommendations build deeper connections and loyalty with consumers. 2. Subscription Models for Recurring Revenue📦 Secure consistent sales with subscription services for essentials or curated products. Enhance retention with membership perks like free delivery or exclusive deals. 3. Local Sourcing & Community Focus 🌱 Tap into consumer demand for local, sustainable products by partnering with local suppliers. This not only builds trust but differentiates from large chains focused on mass distribution. 4. Sustainability at the Core🌍 Sustainable operations are non-negotiable today. Adopt plastic-free packaging, zero-waste policies, and transparent supply chains to win eco-conscious shoppers. 5. Tech-Enhanced In-Store Experiences🤖 Integrate smart technologies like self-checkout kiosks and digital pricing to create a seamless, engaging in-store journey. A frictionless shopping experience is a powerful differentiator. 6. Radical Transparency 🛡 Build trust through openness—share details about sourcing, pricing, and sustainability efforts. Transparency builds credibility and fosters long-term loyalty. 7. Flexible, Small-Format Stores 🏙 Launch urban-focused, small-format stores tailored to time-pressed customers. Quick, convenient, and hyper-local—perfect for today’s urban shoppers. 8. Collaborative Branding🤝 Partner with complementary industries like wellness or meal-kit brands to expand your offering and tap into new customer segments. Collaboration multiplies visibility and value. 9. Health and Wellness Focus🍏 Respond to the growing demand for functional foods with product lines that emphasize health benefits. Clear labeling and expert-backed advice can help differentiate your brand. 10. Omnichannel Mastery & Smart Logistics📲 A seamless omnichannel presence is crucial. Integrate online, mobile, and in-store experiences, supported by efficient logistics like same-day delivery and AI-driven inventory management. The grocery market is evolving rapidly, and for new players, success will depend on the ability to innovate and prioritize customer-centric strategies. By embracing advanced technologies, focusing on sustainability, and developing community-driven models, new entrants can disrupt traditional structures and build lasting relationships with their customer base. #GroceryMarket #RetailInnovation #Sustainability #Omnichannel #CustomerExperience #Strategy #NewMarketEntrants #Personalization

In "Bears Poo in Woods" news, a data analytics company has predicted that Aldi will overtake Asda as the third supermarket in the UK within the next 5 years Per my post (below), in the last year, sales at Asda have fallen 6%, with share down 1.1 points to 12.6% – the lowest in 13 years. Like-for-like was down 5.3% during Q2; with Asda outlining urgent steps needed to win back shoppers like upgrading stores, improving availability, increasing checkout staff The history of our grocers reflects our traditions of commerce and entrepreneurship, after all, we are "a nation of shopkeepers". [Often attributed to Napoleon, dismissing Britain as a country of small business owners. In fact, it can be traced to Adam Smith, who emphasised our commercial spirit in his The Wealth of Nations of 1776.] Arguably the oldest of our grocers, Co-op dates back to the Rochdale Pioneers in 1844 and remains steeped in cooperative values today. Sainsbury's, was founded in 1869 by John James Sainsbury and his wife in London, followed by Marks and Spencer, in 1884 in Leeds as a penny bazaar run by Michael “Don’t ask the price, it’s a Penny” Marks. Morrisons too started humbly in 1899 as a market stall in Bradford, while Waitrose & Partners, founded in 1904 by Wallace Waite, Arthur Rose, David Taylor in West London, with a reputation for quality, Tesco was established in 1919 by Jack Cohen in East London. These grocers reflect Britain's rich history of trade and entrepreneurial spirit So, I wish Asda well in getting back on its feet. Relatively speaking the new grocery kid on the block, dating back to 1949 when it was founded in Leeds as Associated Dairies & Farm Stores Limited by the Asquith family and a group of Yorkshire farmers. Initially focused on dairy, Asda expanded into retailing in the 1960s, opening its first self-service supermarket in 1965. (Asda = Asquith + Dairies) Over the following decades, Asda grew rapidly through acquisitions and diversification, becoming one of our leading grocers. In 1999, Asda was acquired by Walmart (prompting a few weeks of panic at CPGs comparing Asda and Walmart terms and prices) and signalled a new era of growth, introducing the EDLP "everyday low prices" strategy and expanding into non-food, like clothing with George. In 2021, Asda was acquired by the Issa brothers and TDR Capital. 'That's Asda Price' rings hollow with a £6.8 billion price majority funded by debt and disposals, and now struggling to service the £5.9 billion debt Asda remains a staple in British grocery. With its network of stores and online platform, Asda serves millions of customers, loved for its legacy of value, quality, convenience, community engagement and perhaps a little bit more cheek than its straight-laced rivals ___ Footnote: for completeness, Aldi and Lidl were founded in 1946 and 1930 respectively; entering the UK market in the 1990s, scaring the pants off the British grocery industry with their low-cost models ___ #Retail #RethinkRetailTopExpert

The UK grocery market continues to be fascinating, dynamic, with varying fortunes across the retailers with winners and losers. According to Kantar's latest data, there has been a 3.8% rise in take-home sales in the four weeks leading up to August fuelled by an amazing summer of sport (and a slight increase in grocery inflation to 1.8%; a return to pre-crisis average levels, following a period of decline over 17 months). Sainsbury's is the standout performer, recording its largest market share gain since 1997, with a 5.2% increase in sales, while Tesco maintained steady growth, increasing its market share to 27.6%. In contrast, Asda faced challenges with a 6.0% decline in sales and a drop in market share to 12.6%. Asda's difficulties have been attributed to its inexperienced leadership and focus on an unnecessarily challenging IT project, which has detracted from customer priorities and resulted in operational issues such as payroll errors. Retail royalty, and now, Asda chairman Lord Rose gave a blunt assessment of the supermarket’s recent performance. He said “Asda had neglected customers after focusing too much on the £800m Project Future” which was intended to separate Asda from the Walmart systems before the end of the year (and the end of the Transition Services Agreement period), if Asda cannot step off the TSA they will face very steep fees from Walmart which could quickly rise to tens of millions of pounds. Read the excellent ian quinn in The Grocer: https://lnkd.in/eHKahFeX More on the post-Walmart digital transformation: https://lnkd.in/egPD-nqT What went wrong at Asda?: https://lnkd.in/ef5cTUij Traditionally at either end of the grocery spectrum, although those lines are very much blurred, Lidl and Ocado showed robust growth, with Lidl's market share increasing to 8.1% and Ocado's sales rising by 11.3%, maintaining its status as the fastest-growing UK grocer. Aldi, however, saw a slight decline in market share, and Morrisons experienced a minor drop. The faltering Waitrose is investing in innovation aiming to enhance customer experience and attract more shoppers by revamping its Finchley Road store to include new concepts like a hot wok counter and dedicated stations for fresh food. Iceland Foods has successfully returned to profitability, driven by strategic cost savings and a focus on value ranges that appeal to budget-conscious consumers amid the cost-of-living crisis. Overall, the UK grocery sector is navigating a complex landscape, balancing inflationary pressures and strategic investments, with clear winners and losers, the latter struggling to keep pace with operational demands and the former winning with the evolving consumer and shopper. How supermarket share has changed - Angharad Carrick of This Is Money: https://lnkd.in/eRDzj7i7 ____ #TheCPGGeek #IBMRetail #IBMConsumer #FMCG #ConsumerGoods #Retail #RethinkRetail Proud to be a #RethinkRetailTopExpert RETHINK Retail

UK Worldpanel by Kantar data for 12w/e 18-Feb sees Tesco on 27.6% share, followed by Sainsbury's 15.6%, Asda 13.8%, Aldi UK 9.4%, Morrisons 8.8% and Lidl GB 7.5%. The market grew +5.1% trending downwards as we overlap 2023 inflation which fell from 6.8% to 5.3%. Tesco, Sainsbury and Lidl all gained share year on year. Lidl are benefiting from the cost-of-living crisis as shoppers seek to reduce their grocery spend. Oddly, Aldi should be getting some of this too, but their share is flat year on year despite new store openings. #morrisons launched their version of the Aldi & Lidl Price Match. Are all the ‘Price Match’ strategies starting to hurt Aldi specifically?  #privatelabel sales are still marginally ahead of #brands (+5.5% vs +5.3% over the last 4 weeks). Total private label/own label share now stands at 51.4% by value and 59.1% by volume (52 w/e January 2024). Lidl continue to enjoy market leading growth, at 10.9%. This is almost double the growth percentage of #aldi (5.7%). When looking at actual £ sales growth compared to the same 12-week period last year, Lidl have added £260M. With around 960 stores, this equates to an additional £270,000 per store, or £5.2k per store per week. Aldi have added £179M sales in this period but are benefitting from the 24 new stores opened since Feb 2023. Overlay inflation and Aldi must be seeing volumes declining on a like for like basis.    The Lidl Plus loyalty app is contributing to their success (my UK colleagues eagerly await the launch of Aldi’s version). Aldi’s “middle aisle” seems a bit frantic at the moment, with branded food items driving up the price of the average food shop trolley.     February saw Morrisons copy its Northern rival with the launch of their Aldi & Lidl Price Match scheme, featuring 200 mainly #privatelabel products price matched to Aldi or Lidl (whoever is cheaper). We now have four Price Match schemes in the UK. Tesco’s features over 630 products, around a third of which are brands. Sainsbury’s have gradually increased the number of products featured in their version, now also over 600, and Asda have added a few more since their launch last month, now at 330. Morrisons’ offer of just 200 products seems a little thin, but execution in store is strong. Thanks to my International Private Label Consult (IPLC) colleagues Paul Stainton and Richard Harrow for your UK expertise! Irish data is out this week so watch this space! 💡 If you thought this review was useful make sure to connect and follow #supermarketmalachy ✅ I help my clients achieve profitable growth through #strategy and #negotiationskills #training #fmcg #strategyconsulting #commercialskills #iplc #privatelabel #uspire #salestraining #ukretail #competition #supermarkets #waitrose #coop #iceland #ocado #ownlabel #pricematch International Private Label Consult (IPLC)

#tesco hitting its highest market share since February 2022, and accounting for over half of total market sales growth, is the highlight from Worldpanel by Kantar's UK market data for 12 weeks ending 9th June released this morning. 12-wk sales grew by 2.4%, down from the last 12-wk period figure of 3.6%. A continued fall in grocery inflation (2.1% across the last 4 weeks), along with a slight decline in the average number of supermarket visits (16.3 times this month vs. 16.4 in June 2023) has resulted in sales over the last 4 weeks only growing by 1.0%. Tesco’s market share of 27.7% is their highest since Feb 2022. Their continued 3-pronged pricing strategy (Clubcard prices, Aldi Price Match, and Everyday Low Prices) is clearly a winning formula. Of the overall growth in total market value year-on-year (£800M), Tesco have contributed over a half (£416M). #lidl continue to out-perform #aldi, with impressive sales growth of 8.1%, resulting in their market share growing by 0.4%pts YoY. Alongside their increasingly popular loyalty app, Lidl Plus, and their market-leading in-store bakery offer, Lidl are also delivering great differentiation from Aldi (and the other supermarkets) with their very impressive Country Food Themes. One this month was their “Italiamo” Italian theme – over 50 products across chill, frozen, and ambient – brilliantly merchandised in-store, encouraging impulse purchases and resulting in increased basket spend. Aldi’s growth, at just 0.8%, is its lowest since January 2022. They are clearly suffering from all four of the big supermarkets’ price match schemes, so much so that their latest ad campaign takes a pop at such schemes. This may only encourage growth in the number of products included in the Aldi (& Lidl) Price Match campaigns, as recently seen at Tesco, who have added over 100 more products to their Aldi Price Match, all from their standard-tier #privatelabel, including, for the first time, price matching four products from their Plant Chef #vegan range. Sainsbury’s continue to deliver market share growth, up 0.3% pts YoY, whilst #asda continue to struggle, with sales down 4% YoY (-£184M across the 12-week period). #morrisons are faring slightly better (sales up 1.1%). Their business certainly has a spring in its step with new CEO, Rami Baitiéh, making an impressive address at the recent Morrisons/IGD conference, clearly intent on placing the Morrisons customer at the heart of every decision made in a bid to turn the business around. Finally, #iceland are one of the five retailers delivering a YoY share increase, with impressive sales growth of 4.4%. Their private label strategy includes great multi-buy offers on their standard tier range alongside an ever-increasing range of partnerships with other leading brands, resulting in some super #newproductinnovation and differentiation from the competition. #ukretail #supermarkets #ownbrand #waitrose #coop #ocado International Private Label Consult (IPLC)  

Aldi Still UK’s Cheapest Supermarket, Even When Compared To Loyalty Pricing Schemes After including loyalty prices for the first time in its monthly grocery goods price comparison, consumer group Which? found that Aldi still came out cheaper than Tesco and Sainsbury’s. On a basket of 65 items, Aldi’s total came to £118.41. This was £14.49 cheaper than Sainsbury’s and £12.49 cheaper than Tesco for an equivalent list of items, even when discounts from their respective Nectar and Clubcard Prices schemes are included. Julie Ashfield, Managing Director of Buying at Aldi UK, said: “With many households still struggling to make ends meet, we’re more committed than ever to remaining the UK’s cheapest supermarket. This latest Which? analysis shows that Aldi prices just can’t be matched, even with a loyalty card! “At Aldi, we’re dedicated to having clear, consistently low, prices so shoppers know how much they’re spending long before they get to the till. And we’re really proud of the award-winning quality of the products we’re providing at these amazing prices.” Aldi has seen its sales performance weaken this year as Tesco and Sainsbury’s step up their efforts to combat the discounters by expanding their price match schemes. Aldi has also faced price matching on new fronts in 2024, with Asda and Morrisons launching their own versions that also match Lidl. In response, Aldi has ramped up its marketing activity and pledged to reduce more prices in 2024 than in any previous year, with it expecting to top the £380m investment it made in 2023. NamNews Implications: * But why the slowdown in growth? * Aldi are determined to keep this ‘Cheapest Supermarket’ title”’ * ”..’by reducing more prices in 2024 than in any previous year… * …with it expecting to top the £380m investment it made in 2023’ * Watch this space… #Aldi #CheapestSupermarket

UK Worldpanel by Kantar data for 12w/e 17-Mar sees Tesco on 27.3% share, followed by Sainsbury's 15.2%, Asda 13.8%, Aldi UK 9.8%, Morrisons 8.7% and Lidl GB 7.8% (their highest ever UK market share). The market grew +4.2% driven by inflation which fell to 4.5%. Tesco, Sainsbury & Lidl gained share YOY but period on period, we see the usual ebb and flow of discounters versus multiples. Aldi & Lidl combined grew share by a half percent versus the last 12wk period as the multiples lose their big box, Christmas season trading advantage. The problem for Aldi is that their share is actually -0.1ppts YOY with sales growing just 3.1% in the latest period. With the benefit of inflation and approx. 30 new stores, they must be looking at flat LFL sales and volume declines on an individual store basis. Some stores may even see value sales in decline which puts pressure on their ability to maintain store standards with a productivity model that punishes lower sales with less staff hours. There are a variety of factors for Aldi. Firstly, they’re looking like a margin-obsessed business, much more than their historical volume focus. You can see this in action with the increase in brands which make it easier for shoppers to spend more money where previously Aldi’s magic was to make it hard for folks to spend money. Secondly, there are range gaps, possibly due to the new SAP system roll-out. Thirdly, they’re lacking key propositions like in-store bakery, and a loyalty app. And it’s entirely possible that they won’t fill these gaps (for reference, the latest Aldi Ireland TV ads are highlighting their everyday low prices with “no vouchers, no apps, no messing!”). Finally, we’ve got Tesco, Sainsbury, Asda & Morrisons doing ‘Aldi Price Match’ campaigns which must be hurting them to some extent. #morrisons and #waitrose are enjoying an upward trend in sales growth. Although they still lag behind the total market, their growth rates are now ahead of Aldi’s for the first time since the pandemic. Waitrose and Ocado Retail Ltd are the only grocers to boost their number of shoppers in the last 12 weeks, according to Kantar. In the last 4wks #branded sales are growing faster than private label (+6.1% vs +4.7%). My gut is telling me that falling product input costs are flowing through as increased promotional activity rather than permanent price reductions, possibly reflecting ongoing volatility and low confidence in the ability to maintain price reductions. Thanks to my International Private Label Consult (IPLC) colleagues Paul Stainton and Richard Harrow for your UK expertise! Irish data is out next week so watch this space!   💡 If you thought this review was useful make sure to connect and follow #supermarketmalachy ✅ I help my clients achieve profitable growth through #strategy and #negotiationskills #training #fmcg #strategyconsulting #commercialskills #privatelabel #uspire #salestraining #ukretail #competition #supermarkets #coop #iceland #ownlabel

Some interesting insights here into the future of the FMCG sector...

My take out here - Lidl's Loyalty programme is contributing to robust share growth. It's a timely reminder that.. ‘Customer Data Is More Valuable Than Oil’ – And Tesco Is Showing Us How To Extract And Refine It. Tesco’s digital platform for buyers, suppliers, and their agencies to bid for ad features and share customer insights in real time. Buyers will use data for ‘Range simplification’ – de-listing products much quicker if they fail to perform. For subscribing suppliers it’s a chance to bid for advertising space to promote and prevent their product R&D going to waste. 10 KEY INSIGHTS: 1.     DATA AND CUSTOMER INSIGHT IS CENTRAL TO TESCO’S SUCCESS – providing opportunities to up sell, cross sell, improve customer service and retention rates. 2.     TESCO MEDIA SALES HAVE GROWN EXPONENTIALLY - it generates sales of more than £1billion annually - selling coupons, magazine ads, posters. The new platform automates more of the process. 3.     THE AD INDUSTRY SPENDS £29 BILLION EACH YEAR – Tesco attracts a dis-proportionate share because few other retailers identify individual shopping habits and personas and link these back to purchases and media like Clubcard can. 4.     DUNNHUMBY IS THE BACKBONE OF CLUBCARD – wholly owned by Tesco, founded by Edwina Dunn and Clive Humby in 1994 and recognised for setting global standards in customer data science. 5.     AND LOYALTY MATTERS - Clubcard attracted more than 20 million UK households actively using it to shop and save, making it Britain’s largest retail loyalty programme. 6.     OTHER RETAILERS RECOGNISING ASSET VALUE – Amazon’s ‘Prime’, Walmart’s ‘Connect’, Target’s ‘Roundel’ media platforms and also in the UK, Boots ‘Advantage card’ now has 17m loyal members. 7.     A PERSONALISED CUSTOMER EXPERIENCE - as the grocery sector evolves, Tesco differentiates with relevant personalised offers to meet their customers’ changing needs. 8.     TESCO’S FOCUS - until now, has been on its Clubcard Pricing initiatives as it takes the price war to Aldi. 9.     RICH IN INSIGHTS – launching a media and insights platform for their suppliers and advertising agencies will improve engagement and develop more effective propositions. 10.  ACCELERATING DIGITAL MARKETING REVENUE - attracting much greater revenue from digital by offering 5 levels of ads, from one-to-one personalisation to broader mass reach campaigns. Customer insights are clearly creating competitive advantage to those who recognise the assets value. Building infrastructures to capture then refine customer data into actionable insights will drive customer loyalty. Are you already taking steps with your data to leverage growth or will you allow your business to fall behind? #customerinsights #dataculture #dataanalytics #datascience #monetisation

#lidl being the only retailer delivering double-digit growth, and adding over 50% more sales than #aldi, are the highlights from Worldpanel by Kantar's UK market data for 12 weeks ending 18th February released this morning. 12-week sales grew by 5.1%, down from the last 12-week period figure of 5.5%. Over the last 4 weeks, grocery #inflation fell from 6.8% to 5.3%, its lowest since March 2022, in a month where spend on promotion increased by 4% and #morrisons launched their version of the Aldi & Lidl Price Match. #privatelabel sales continue to perform ahead of #brands, albeit it marginally (+5.5% vs. +5.3% over the last 4 weeks). Total private label/own label share now stands at 51.4% by value and 59.1% by volume (52 w/e January 2024).   Lidl continue to enjoy market leading growth, at 10.9%. This is almost double the growth percentage of #aldi (5.7%). When looking at actual £ sales growth compared to the same 12-week period last year, Lidl have added £260M. With around 960 stores, this equates to an additional £270,000 per store. Aldi have added £179M sales. With 1014 stores, this equates to an additional £176,500 per store. Lidl are therefore generating over 50% more sales growth per store than Aldi.   The Lidl Plus loyalty app will be contributing to their success – we still await the inevitable launch of Aldi’s, and I believe Lidl’s Special Buys may be working harder than Aldi’s, as we see some great food themes and well-managed non-food themes at Lidl. Aldi’s “middle aisle” seems a bit frantic at the moment, with many more branded food items taking the space previously occupied by higher value non-food specials.   The traditional “Big 4” have, collectively, held their share year-on-year, but within this we see #tesco and #sainsbury’s surging ahead. The difference in market share between Tesco and Asda has widened by 0.8% points over the past year, with Sainsbury’s share widening by 0.9% points over #asda.   Morrisons’ are now growing at a rate higher than Asda – this period last year saw Asda’s growth rate at 6.8% points ahead of Morrisons – now it is 1.2% points behind. And February saw Morrisons copy its Northern rival with the launch of their Aldi & Lidl Price Match scheme, featuring 200 mainly #privatelabel products price matched to Aldi or Lidl (whoever is cheaper).   So, we now have four Price Match schemes in the UK. Tesco’s “original” version features over 630 products, around a third of which are brands. Sainsbury’s have gradually increased the number of products featured in their version, now also over 600, and Asda have added a few more since their launch last month, now at 330. Morrisons’ offer of just 200 products seems a little thin, but execution in store is strong.   I do wonder if we will see some originality from the supermarkets this year…. #ukretail #competition #supermarkets #waitrose #coop #iceland #ocado #ownlabel #pricematch International Private Label Consult (IPLC)