Supermarkets’ heavy use of price cuts and promotions is failing to encourage consumers to buy and spend more, according to latest figures from Nielsen.
During the four weeks ending 24 May, consumers spent -0.9% less money and bought -2.1% less volume at the UK’s leading supermarkets than the same period a year ago.
“Supermarkets are trying hard to stimulate sales - 35% of sales are on items with price cuts and special promotions - but it’s still not enough to override consumers’ money-saving mindset,” said Nielsen’s UK head of retailer and business insight Mike Watkins.
“The situation is compounded by record low levels of shop price inflation and price cuts in staple categories such as milk, bread and produce, which aren’t generating a large enough uplift in volumes to grow revenues.”
However, soft drinks recorded a 3.2% sales growth in the four-week period, making it the best-performing category - helped by hot weather in the middle of the month.
Aldi and Lidl continued to outperform the market in the 12 weeks to 24 May, with sales increases of 33% and 22% respectively. Along with M&S and Waitrose they are still gaining market share, at a total of 2.3% collectively over the period.
Tesco has the largest market share at 28.2%, but it is down 1.3% on the same period last year.