New data from Kantar analyses the changing dynamics within the Republic of Ireland (ROI) grocery market and future growth trends.
The ROI market is currently valued at over €9bn and is extremely competitive. Tesco’s sales performance has turned around in the last year, and volume growth is now clearly established. Strong footfall growth led to Supervalu moving to the no. 1 spot during Q1 2015. Dunnes is establishing a platform to challenge Tesco and Supervalu, and has announced plans to enter the online space. The discounters Aldi and Lidl, meanwhile, aim to build broader range acceptance among consumers and grow shopper spend through more frequent visits. Some key consumer trends driving developments are as follows:
1. During the recession years, food as a proportion of overall household expenditure fell, however, as the economy returns to recovery, there is likely to be increased disposable income and potential for brands to re-capture lost share.
2. Retailer loyalty cards are increasingly important, with 67% of shoppers saying they use one.
3. Online shopping is becoming increasingly important as spend and volume increases and the overall share of online Take Home Groceries increases.
4. Convenience shopping is also a key driver, with the convenience mission having a frequency of 188 times over the year. This shopping trip is often a distressed one and key categories include milk, bread, beer and wine.
5. Looking at population changes, older shopper groups are in growth and older dependents actually spend more than any other lifestage group on Groceries at €7,568 per annum.
6. Health is a dominant issue with 83% of people saying they try to lead a healthy lifestyle, with the health agenda particularly prevalent in the “Lunchbox” shop mission.
7. Buying for a cause whether it is Local, Irish, Organic, Sustainable, Charity or Fairtrade is important to shoppers, and brands including Innocent and Pampers have well-recognised campaigns in this space.
8. Simplicity – meal deals are appealing to shoppers because they provide a solution to a need.
9. Vouchering has become a significant trend and, with 69% of shoppers saying they choose a store because it offers money-off vouchers, it directly influences the shopping destination selected.
10. The last key trend is store switching, which is underpinned by discounter growth and shoppers expanding the range of categories shopped in the discount channel.
