Grocery giants raise game as discounters power ahead, IGD

The UK food and grocery market will grow by 14.8% between now and 2023, giving it a value of £218.5 billion, according to IGD.

Growth is predicted across all major channels, with online and discount set to account for over half of the increase in market value to 2023. Driven by rapid physical expansion, discounters will achieve the biggest cash gain in sales over the next five years (30% of the total) as they benefit from further store openings and format development.

Online will remain the fastest growing channel. Smaller and more recent entrants will scale up their operations and target emerging shopper needs. More established players will step up their use of web analytics to improve and personalise shoppers’ online experience. More rapid and flexible fulfilment options will be key, such as Click and Collect services from more convenient locations such as local c-stores, places of work and unattended lockers. 

The convenience channel, meanwhile, is forecast to return to a stronger growth trend in 2019. Larger stores remain the most visited channel with 98% of shoppers visiting at least once in the last month, followed by convenience stores (89% of shoppers). 88% of shoppers use both.“Growth is increasingly being driven by recent entrants to the channel and more delivery options,” says Simon Wainwright, Director of Insight at IGD. 

“But we’re seeing more ambition from the Big Four as well, making ordering easier, improving picking, new capacity and faster deliveries. Analytics are also being utilised more effectively to target customers with more personalised content. Rising customer service expectations are encouraging the development of more rapid delivery services and other technological responses such as unattended delivery solutions.”

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