Asda struggles as consumers crave promotions

Asda continues to feel the pinch with a drop in market share for the fifth consecutive month, according to the latest supermarket share data from Kantar Worldpanel.

Asda store
Asda store

In the 12 weeks ending 16 May, sales at Asda continued to grow (2.5%), but more slowly than the market average of 3.3%.

Tesco managed to match market growth, while the other half of the ’big 4’ all posted sales growth ahead of the market: Sainsbury’s (4.4%) and Morrisons (6%).

The latest data by Nielsen, also published today, shows similar trends, with senior manager retailer services Mike Watkins suggesting that “we have passed the low point in terms of year-on-year growth”.

“However, shoppers still need to be encouraged to spend,” he adds. ” Shoppers remain fickle and disloyal and are still shifting to retailers offering the most immediate savings.”

As a result, promotional spend was maintained at 35% – with the exception of Asda where spend has fallen in the past 8 weeks.

Earlier this month Andy Clarke was appointed Asda’s new CEO in place of Andy Bond. A key priority for Clarke will be restoring clarity of its ’Every Day Low Prices’ initiative.

The situation among the discounters was mixed, according to Kantar Worldpanel. Lidl and Netto “struggling to keep pace with the market”, while a combination of store consolidation and a “strong advertising campaign featuring celebrity chef Phil Vickery boosted Aldi’s market share to 3.1%.

Though consumers are looking for value, the likes of Tesco’s Finest range “continue to perform well” according to Kantar Worldpanel.
Waitrose also put in another strong 12 weeks with sales up 12.3%, according to Nielsen.

Marks & Spencer sales increased 3.3%, says Nieslen. M&S CEO Marc Bolland today revealed a 4.6% rise in full year profit.