Listening to customers helps supermarkets grow market share

10th Feb 2017

German-owned Aldi continues to grow its share of the UK’s supermarket sector.

Aldi has overtaken the Co-operative as Britain's fifth biggest supermarket, according to research firm Kantar Worldpanel. The retailer’s sales rose 12.4 per cent year-on-year in the 12 weeks to 29 January, taking its market share to 6.2 per cent and ahead of the Co-op's.

Meanwhile, sales at Lidl rose 9.4 per cent, taking its market share to 4.5 per cent – further underlining the challenge the big retailers are facing from discount supermarkets.

“Underpinned by an extensive programme of store openings, the past quarter has seen Aldi attract 826,000 more shoppers than during the same period last year,” says Fraser McKevitt, head of retail and consumer insight at Kantar.

Tesco remains the clear leader with more than 28 per cent of the UK market, while Morrisons – the smallest of the ‘big four’ – increased sales by 1.9 per cent, gaining market share for the first time since June 2015.

Concentrating on convenience

Despite falling behind Aldi, Co-op also increased its market share. The supermarket has enjoyed a year and a half of growth, and its two per cent sales increase in the 12-week period was “well ahead of the market”, found Kantar.

Co-op’s continuing growth owes much to its ability to listen to what customers want. The retailer has focused on having fewer large stores and expanding its core convenience business, with the right stores in the right location with the right range. Co-op says it has revised its range to meet what it describes as the “little and often” mantra of the modern-day shopper, tailoring its offering to meet the needs of local communities, whether it be top-up shopping or food on the go.

The importance of making experiences easier and simpler for customers was underlined in The Institute of Customer Service’s latest UK Customer Satisfaction Index. The index also found continuing evidence of the link between high levels of customer satisfaction and business performance, especially in the context of food retailers.

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