Growing appetite for premium goods fuels grocers’ festive boom

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Growing appetite for premium goods fuels grocers’ festive boom

Taste for luxury products and strong consumer sentiment sees shoppers spend €1bn on Christmas


‘You’re likely to find a much broader branded range of products in Dunnes. Stock image
‘You’re likely to find a much broader branded range of products in Dunnes. Stock image

Demand for premium products helped Irish grocers enjoy a record Christmas in 2018.

Some €1bn was spent on groceries in December as Irish shoppers showed an appetite for splashing out on more expensive items.

Sales of branded goods rose 3.2pc year-on-year, while sales of premium private label ranges were up 11.2pc.

Dunnes Stores stretched its lead as Ireland’s number one supermarket by market share, the new statistics by market researchers Kantar Worldpanel show.

“For most shoppers, when it comes to Christmas they have a higher preference for branded products than they would at other times of the year,” said Douglas Faughnan, consumer insight director at Kantar Worldpanel.

“It’s a time to indulge, it’s a time to treat yourself, and Dunnes are synonymous with brands.

“If you take any given Dunnes store … you’re likely to find a much broader branded range of products in Dunnes than you would in some of the other retailers.

“They’ve put a real emphasis on positioning themselves as a premium food retailer. Over the last couple of years they’ve acquired Whelan’s Butchers, some of the stores have a Sheridan’s cheesemonger, and all that lends itself to a more premium food and drink retailing experience.”

Sales of traditional Christmas treats were also strong in 2018 – with mince pie sales up 10pc, and seasonal biscuits growing 11pc. Shoppers spent €2m on Christmas puddings alone, Kantar said.

Dunnes retained its position as top supermarket by market share, coming in at 23pc.

Tesco, which reported relatively anaemic Irish figures last week (including the festive period but also stretching back well before that), was in second at 22.3pc. Kantar said the British retailer’s premium ranges did well.

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SuperValu was third on 21.8pc, while Lidl and Aldi were ahead of the same period last year on 10.5pc and 10.8pc respectively.

Kantar said it would have done well from last minute ‘top-up’ shops because of a “convenient store network and strong fresh food offering”.

All of the five main supermarkets saw the value of their sales increase on last year. Aldi had the biggest growth on 8.6pc, while SuperValu was the lowest on 1pc.

“From a macro perspective then if you look at the Irish economy, unemployment is still falling. Consumers are pretty confident though there’s maybe a little uncertainty around things like Brexit coming down the tracks.

“At this point in time that concern doesn’t seem to be filtering through into shoppers’ plans for groceries,” Mr Faughnan said.

Kantar said Aldi and Lidl had achieved record market share for a Christmas period.

“The impact Aldi and Lidl have made on the ultra-competitive Irish grocery landscape is evidenced by the fact that more than 70pc of households visited each retailer in the 12 weeks to 30 December,” Mr Faughnan said.

“Own-label products still account for the majority of both retailers’ sales, but it was the premium end of these lines which recorded the strongest growth. Similarly, sales of branded goods accounted for more than 40pc of the growth achieved for both Aldi and Lidl – testament to the popularity of their ever-expanding ranges.”

Irish Independent

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