Dunnes Stores turns up heat on rival Tesco in battle for shoppers
Published 10/05/2016 | 02:30
Dunnes Stores is intensifying its battle to squeeze Tesco into third place in the league of the nation's biggest grocery retailers.
If Dunnes succeeds in doing so this year, it would put Tesco in the unenviable position of having gone from number one in the Irish market to number three in the space of less than two years.
New data from research group Kantar Worldpanel shows that SuperValu remains the biggest grocery retailer in Ireland, with a 23pc share of the multi-billion euro market during the 12 weeks to April 24.
That's down from 23.2pc in the previous period, however. The value of sales at SuperValu was 2.8pc higher.
Tesco has a 22.2pc market share, while Dunnes has 21.5pc. Those figures compare to 23.2pc and 20.6pc respectively in the corresponding period a year earlier. The value of sales at Dunnes in the most recent 12-week period was 8pc higher.
Kantar Worldpanel director David Berry said that Tesco has been investing in low prices in a bid to win back consumers. That saw the value of sales at Tesco fell by 0.7pc in the latest 12-week period.
Tesco recently reported that its like-for-like sales in Ireland fell 1.9pc in its latest financial year, but were positive in the fourth quarter for the first time since 2012.
Mr Berry said SuperValu, the brand owned by the Cork-based Musgrave group, had benefited from a continuing consumer drift towards fresh food.
"We've seen consumers continue to allocate more of their shopping budget to fresh food over the past four years, and SuperValu has managed to capitalise on this very successfully," said Mr Berry.
He added that Lidl remains the fastest-growing retailer, with its market share in the latest 12-week period rising 0.6 percentage points to 11.2pc. The value of its sales in the period rose 9.5pc.
The growth has in part been spurred by its continuing expansion, with new stores contributing to the increase.
Aldi's share of the market dipped 0.3 percentage points to 10.9pc, but the value of its sales rose 1.3pc in the latest period.
Kantar Worldpanel also said that grocery inflation in Ireland stood at 2.1pc in the 12 weeks to April 24.
That means that the growth in value of sales at SuperValu and Dunnes beat inflation in the period, but outstripped value of sales declines at Tesco. The growth in the value of sales at Aldi - at 1.3pc - didn't keep up with the pace of inflation.
Mr Berry said that the performance at Dunnes has been driven by bigger shopping trip by customers, as they capitalise on its voucher offer.
The retailer has also been selling a wider range of upmarket products. Consumers are now typically spending an extra €2.50 on each shopping trip at Dunnes.