A new Mintel survey concludes that British shoppers have finally let reality bite and bid farewell to premium ranges as the economic downturn hits home.

So far this year, British shoppers had been in denial - spending more than they did in 2007, in spite of the mounting evidence that their incomes were being squeezed. But the Mintel research shows that reality is beginning to strike and Brits are making dramatic changes to the way they shop for food.

In the last 12 months alone, 41 per centof shoppers have switched to cheaper brands and one-third (34 per cent) have cut down on premium ranges, such as Tesco Finest and Sainsbury's Taste the difference.

"It is clear that shoppers are now really feeling the pinch and beginning to trade down when out buying food," explains Richard Perks, director of retail research at Mintel. "During the recent years of unprecedented prosperity in Britain, we saw a very noticeable shift towards premium, upmarket food, with shoppers buying more luxurious ready meals and exotic produce. But in the space of just a few months, this trend has already started to be reversed."

Understandably, Brits are also becoming a lot more price conscious. Two-thirds (66 per cent) now look for the promotions and deals more often than we did a year ago, while 29 per cent spend more time comparing prices in the supermarket. The well-documented rise in the popularity of the hard discounters Lidl and Aldi also shows through in the survey - and they are not just appealing to the well off, as 31 per cent of adults go to discounters more often than they used to.

The changes are having a profound effect on the food retailing market, as supermarkets are forced to take action to give shoppers what they need, said Perks. "The major battle of this recession will be the fight between the hard discounters and the market leading superstores," he added. "Asda is focusing on its entry level prices and Tesco has just launched an ultra-low-priced range called 'Market Value'. With this shift they are making it very clear that they will not just lie back and watch their market share being whittled away by the likes of Lidl and Aldi.”

In August, Office of National Statistics figures showed that volume sales in the food retail market dropped for the first time for an extended period. “While this is not good news for the supermarkets all is not lost,” said Mintel. “Value for money is the key to success in tougher times and the supermarkets are the retailers best able to offer that, whether it is for food or for clothes and electricals. Although no-one is likely to have an easy time, they will undoubtedly be the winners over the next couple of years," said Perks.

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