Aldi and Lidl see sales grow by almost 20% as inflation hits household budgets

Aldi and Lidl have seen sales grow by  19.2%. Picture by PA
Aldi and Lidl have seen sales grow by 19.2%. Picture by PA

Discounters Aldi and Lidl have grown at their fastest rate since 2015 as inflation helped the market to its best performance in more than three years.

The two grocers reached a joint record market share of 12% as inflation cost families an extra £27 on groceries over the past 12 weeks, Kantar Worldpanel figures show.

Aldi and Lidl saw sales grow 19.2% year on year as 62% of the UK population shopped in either of them over the past three months, up from 58% this time last year and an additional 1.1 million households.

Iceland also grew well ahead of the market, increasing sales by 8.6% and attracting 380,000 more shoppers to boost its share to to 2.2%.

Overall sales grow by 3.8% year on year, the market's best performance since September 2013.

All 10 grocers researched saw sales increase, boosted by higher prices as inflation continues, Kantar said.

Own-label sales were up 6% year on year, in contrast to branded products which grew by just 0.6% during the same period.

Tesco increased sales by 1.8% year on year, attracting more than 250,000 extra shoppers over the 12 weeks, helped by promotions on barbecue foods and its Food Love Stories campaign encouraging customers to cook from scratch.

Asda also increased shopper numbers by more than 360,000, but Morrisons once again enjoyed the best performance of the big four, with sales of its premium own label range The Best up by a third on last year.

Waitrose saw its sales grow 3.3% year on year, although its market share slipped slightly to 5.2%.

Chris Hayward, consumer specialist at Kantar Worldpanel, said: "The big four have collectively grown by 1.6% overall, while Aldi and Lidl together grew at their fastest rate since January 2015.

"Consumers are starting to feel the pinch as prices continue to rise, with the average household spending an additional £27 on groceries during the past 12 weeks.

"That may not seem like much, but if inflation continues at its current rate over the course of a year, that would mean an extra £119 spent on groceries per household."

Meanwhile, figures from analysts Nielsen show Tesco recording the fastest-growing sales of the big four for the second consecutive month.

Tesco increased sales by 2.2% over the 12 weeks to May 20, ahead of the 1.4% for Morrisons, 1.2% for Sainsbury's and a 0.1% decline for Asda.

Mike Watkins, Nielsen's UK head of retailer and business insight, said: "Tesco's re-focus on the customer and their changing needs, such as simplifying ranges and promotions, has meant they've not only attracted new shoppers but encouraged them to visit more often.

"The return of inflation has helped supermarket grow sales, but the challenge for the summer is to sustain this by encouraging shoppers to put more items into the weekly basket."