Discount brands impact Tesco market share

Garner: Christmas will be critical test

Tesco has recorded a drop in market share for the 12 weeks ending 30 November 2008.

According to the latest TNS Worldpanel till roll data, Tesco’s share has dropped to 30.9% from 31.5% with its growth standing at 4.3%, lagging the total market growth rate of 6.2%.

Ed Garner, director of research at TNS Worldpanel, said: “Rather than being a serious volume decline of the business, this represents self-imposed deflation with its introduction of discount brands to increase price competitiveness.”

Waitrose has also seen its share slip from 3.8% to 3.6% in the latest 12-week period and, for the first time in recent years, it has moved into negative territory with –0.7% year-on-year growth.

Despite the pressure on premium retailers, Sainsbury’s is matching total market growth and its 16% market share is unchanged year-on-year.

Asda and Morrisons continue to benefit from their value for money reputations, reports TNS. In the 12 weeks to 30 November, their sales have grown by 7.8% and 10.3% respectively.

Iceland and the discounters, Aldi and Lidl, are also growing on the back of their value positioning.

Aldi, in particular, has set new records with growth of 25.4% and a 3.1% market share.

The next data issue will cover the key Christmas trading period. According to Garner, it will be a critical test of consumer confidence to see whether the traditional share uplifts of Sainsbury’s and Waitrose are maintained.