Sunday 8 December 2019

Feel-good shoppers splash out on brands

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John Mulligan

John Mulligan

The sale of branded goods in Ireland's grocery market has accelerated faster than the sale of own-label products for the first time in four years, as consumers feeling more flush with their cash decide to splash out.

Research group Kantar Worldpanel said that the sale of branded goods in Ireland's grocery sector during the 12 weeks to January 28 rose by 4pc in the period - a stronger performance than own-label categories.

"The recovery of branded sales began in late 2017 and has continued apace in the new year," according to David Berry, director with Kantar Worldpanel.

"Shoppers parted with an additional €49m on their favourites during the past 12 weeks," he added. "This is the first time in four years that brands have posted stronger sales growth than their own label counterparts, with alcohol, baked goods, frozen food and toiletries performing best."

The data also came as figures from KBC Bank Ireland and the ESRI showed that consumer confidence in Ireland hit its highest level since 2001 during January.

But the survey noted that it was important not to overstate the strong sentiment, as it signals that consumers believe their recent circumstances have improved, rather than believing they are better than at any time in the past 17 years.

An improving economy is filtering deeper into consumers' pockets. While the increase in sales of branded goods can't be seen as a direct proxy for stronger economic growth - the Kantar Worldpanel data covers the important Christmas season when shoppers are inclined to spend more - they may serve to underscore a broader feel-good factor among consumers.

Last summer, Kantar Worldpanel pointed out that about 54pc of the money spent by grocery shoppers here was on own-label goods.

In that period - the 12 weeks to May 21 - the sale of own-label goods had climbed 3.8pc.

The 54pc figure compared to just 10pc before the crash.

The latest data shows that Tesco had 22.7pc of Ireland's grocery market, while Musgrave-controlled SuperValu had 22.2pc. SuperValu also boosted its market share in the Dublin region - an area where it was traditionally under-represented. Musgrave acquired the Superquinn chain in 2011.

Tesco has continued its recovery in the Irish market, posting the tenth consecutive month of sales growth.

Mr Berry said that although Dunnes Stores - controlled by Margaret Heffernan and Frank Dunne - has witnessed a decline in footfall, it has benefited as its shoppers spend more.

The retailer's long-running voucher promotion scheme, which has cost it tens of millions of euro, has played a role in enticing shoppers.

Irish Independent

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