Despite tightening household budgets, overall supermarket sales increased by 3.8 per cent in the final quarter of 2017, with spending up by £1 billion on last year, according to Kantar.
The latest grocery market share figures from Kantar Worldpanel show that the average household shrugged off economic worries to spend a record £1,054 on groceries in the 12 weeks to 31 December 2017.
Shoppers continued to trade up to more expensive options, with a record £469 million spent on premium own label lines in December alone.
Busiest shopping day ever
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “Overall supermarket sales increased in value by 3.8 per cent, with an additional £1bn ringing through the tills compared to the same festive period last year.
“Shoppers parted with £747m on 22 December alone, making the Friday before Christmas the busiest shopping day ever recorded.
“For most of the year, location tends to be the most important factor in choosing where to shop, but over Christmas customers are actually prepared to travel further in search of specific festive products or better value.”
Fewer promotions, higher spending
Shoppers continued to splash out despite there being fewer promotions this year, with only 36 per cent money spent on items that were on offer. This is the lowest level of promotional activity at Christmas since 2009.
Among the retailers, Aldi and Lidl are still level pegging in the battle to be the nation’s fastest growing supermarket, with both growing sales by 16.8 per cent year on year.
McKevitt explained: “In some ways Christmas is a tricky time for the discounters – they tend to lose a little market share compared to earlier in the year as many shoppers return to the more traditional supermarkets in search of old favourites.
Discounters boost market share
Despite this, Aldi and Lidl collectively managed to attract nearly one million additional households to their stores in the final three months of 2017.
Aldi increased market share by 0.8 per cent year on year to capture 6.8 per cent of the market, while Lidl grew market share by 0.6 percentage points to reach five per cent market share, helped by a £23m boost from fresh produce.
Tesco was the fastest growing of the big four supermarkets, with sales up 3.1 per cent during the 12 week-period.
This is the fastest sales growth the retailer has seen since June, helped by a 6.4 per cent increase in sales of standard Tesco own label.
Convenience stores cash in
With Christmas Day falling on a Monday this year, Tesco Express and other convenience stores benefitted from restricted Sunday opening hours for larger supermarkets.
It was able to capitalise on consumers preferring to shop closer to home just before the big day. Despite a successful festive period, Tesco is still growing behind the market with a 0.2 per cent fall in market share to 28 per cent.
Meanwhile, Asda’s sales grew by 2.2 per cent. This was particularly helped by a strong online performance, which saw the retailer’s average shopping basket increase to just over 16 items.
Despite this, the grocer’s market share declined by 0.2 percentage points to 15.3 per cent.
Record Christmas for online sales
Morrisons increased sales by 2.1 per cent, with strongest growth coming from ambient and frozen foods, though the grocer’s market share fell by 0.2 percentage points to 10.7 per cent.
Sainsbury’s managed to increase sales across its convenience stores, larger supermarkets and online deliveries, growing by two per cent overall.
This is against the backdrop of the retailer’s continuing strategy of moving away from promotions, selling 5.6 per cent fewer items on offer than during the same period last year.
Sainsbury’s market share fell by 0.3 percentage points to 16.4 per cent.
Overall online supermarket sales enjoyed their biggest ever Christmas, up 4.9 per cent year on year. Ocado comfortably outpaced the online market, increasing sales by 8.4 per cent to account for 1.3 per cent of the grocery market.