Irish grocery market returns to growth

THE Irish grocery market has returned to growth, with short-term sales ahead compared to this period last year, according to new consumer market analysis from Bord Bia.

The latest quarter shows market value growth picking up and now at +1.1% relative to a year earlier for the period ending April 2011, according to a study conducted by Kantar Worldpanel data.

Bord Bia marketing expert Gillian Swaine notes: “Price inflation continues to bring increased value into the market. However, while shoppers are visiting retailers as often this year, they are cutting back on the amount spent per visit.

“While the level of promotional activity has increased slightly in the most recent period, the overall level has seen some decline since the start of this year.”

According to technology solutions company Aldata, who have been carrying out a Global Retail CIO survey for the past three years, retailers are facing “promotion fatigue”.

Research conducted by the company found that consumers had a “negative impression of promotions”, “they didn’t understand the pricing proposition behind it” and often ended up wasting food.

Looking at the retail market performance, Bord Bia notes that discounting retailers now have a combined share of 10.3% of the Irish grocery market and a combined estate of 210 stores. They attracted 1.2 million households in the latest quarter (+71,000 versus April 2010) and shoppers visited 9.4 times on average in the last 12 weeks.

Ms Swaine added: “Their growth is attributed to a number of factors, including new store openings. The discount model is also benefiting from shoppers trading down from more expensive lines and mainstream formats.”