IGD Highlights Top UK Discount Grocery Shopping Facts.

With the news today of Tesco announcing its new brand and stores – Jack’s, IGD shares the top ten stats that you need to know about the UK discount channel:

1. Shoppers perceptions of Aldi and Lidl are changing as the food discount channel evolves with shoppers perceiving Aldi and Lidl more as supermarkets than as discounters. Over half (53%) of British grocery shoppers refer to Aldi as a supermarket and 40% refer to it as a discounter and 50% of British grocery shoppers refer to Lidl as a supermarket and 40% refer to it as a discounter

2. Aldi is now a destination for the main shop – nearly half (47%) of Aldi shoppers were on a main shop on their last trip, which is in line with supermarkets. This has increased from 41% over the same period a year ago

3. Some 21% of food discount shoppers claim to have been looking to buy an evening meal on their last shopping trip, which is the same as supermarket shoppers, with 21% also on an evening meal mission. This is likely to have been driven by improved merchandising and increased ranging of evening meal solutions in discount stores

4. IGD forecasts the UK discount channel will account for £1 in every £7 spent on groceries by 2023

5. The discount channel has the highest cash growth sales forecast over the next five years, up 37% from £23.1 billion in 2018 to £31.5 billion in 2023.

6. IGD forecasts discount stores per capita in the UK will double from 2010 to 2023, to reach 5,118 stores

7. The discount channel is well embedded into multichannel shopping behaviour, some 84% of British grocery shoppers visit at least one discounter every month

8. Over half (53%) of London grocery shoppers claim they would use Aldi and Lidl more if there was a store nearer to them

9. Some 43% of London shoppers would use variety discount stores more to buy groceries if there was one nearer to them

10. The top five reasons why British grocery shoppers visit food discounters are:

a. Helps me to save money – 79%

b. Good quality products – 39%

c. More convenient – 37%

d. Good choice of products – 36%

e. Quicker and easier – 26%

The top five reasons British grocery shoppers visit supermarkets are:

a. More convenient – 66%

b. Good choice of products – 48%

c. Quicker and easier – 43%

d. Good quality products – 34%

e. Helps me to save money – 25%

With Tesco also announcing eight out of 10 products ranged at Jack’s will be grown, reared or made in Britain, IGD research also highlights the importance of provenance to British shoppers when buying food and groceries:

11. British or locally produced is one of the top attributes that shoppers use to help define a product as being higher quality. Some 27% of British shoppers claim that British / locally produced helps them to identify a product as being higher quality

12. Nearly half (47%) of British grocery shoppers agree that it is more important to use British suppliers, even if that means food and groceries are more expensive for shoppers

13. Some 78% of British grocery shoppers agree that Britain needs to be more self-sufficient in food and not rely on imports as much

14. Over two thirds (68%) of British grocery shoppers agree that supermarkets should focus more on selling food produced by British farmers

Simon Wainwright, Director of Insight at IGD, said: “Ambitious store openings have supported rapid discount growth in the UK to date. However, the next period of growth may be more complex for two reasons; there are sizeable opportunities for growth in London and the south east, but competition for the best sites is intense, so we predict discounters will work closer with developers to unlock these sites; cities and towns will see multiple stores from the same discounter, which risks self-cannibalisation of sales. As the discount channel matures, maintaining sales growth will be a challenge.

“The discount channel will continue to offer suppliers undeniable growth opportunities, so continuing consolidation and collaboration will offer greater scale, while new store openings will widen their reach. As competition within discount intensifies, differentiation will become more important for individual retailers to stand out. Exclusive products will help discounters to stand out from one another and make it harder for shoppers to compare prices across channels. A stronger and more impactful discount channel will depend on consolidation, centralisation and collaboration.”

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