A surge in supermarket spending took place in the final weeks of December 2022 as Total Till value growth increased to 10.9% from 7.6% at the start of the month, new research shows.
The data from NielsenIQ found that this increased spending came as a result of accelerated food inflation, weak comparitives and strong sales in the seven-day trading week to 24 December.
According to the global information service, this week also saw value sales increasing by 19% and volume sales rising by 8.8% as spending topped £4.6 billion, the highest spending week on record.
As Christmas saw price cuts across dinner staples, promotional spend increased to 23% of all FMCG sales, found to be the highest in 2022.
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The World Cup also saw beer, wine and spirit sales up by 0.1% in December and at 11.6% during the Christmas week.
During the trading period, NielsenIQ said M&S and Sainsbury’s traded well and Morrisons growth turned positive in the last four weeks, despite a sales decline last year.
“Despite inflation, the pressure on household spend impacted spend per visit which increased only slightly to £22.02 from £21.34 a year ago,” NielsenIQ UK head of retailer and business insight, Mike Watkins said.
He added that cold weather and rail disruption “may have held back some spend in the hospitality channels” in December, “helping food retailers to gain “share of calories consumed” from the out-of-home channels.”
“Shoppers were still willing to buy extra Christmas indulgences but the performance of the industry was shaped by the cost-of-living crisis and the need to save on grocery shopping.”
Watkins said that looking ahead, “weak confidence around personal finances and a squeeze on disposable income will have a big impact on demand over the full year.”
“We estimate total food retail growth in 2023 to be around 5% (a total of £190bn across all channels). However, we also expect the recession to start to influence shopper behaviour and reframe overall retail spend.”
