Case Study
Face-to-Face Consumer Interviews For Havering Council
After months of supermarkets offering shoppers ever-greater savings, promotions have become shallower over the past month.
All but one of the 10 most-promoted brands reduced the level of savings offered in the past four weeks, according to Assosia data to 7 August. Across the big four and Waitrose, the average saving offered by featured space promotions has fallen 2.7 percentage points month-on-month from 33.8% to 31.1% with own-label savings dropping 4.6 points compared with a 1.2 point decline in savings on branded products.
The situation is in stark contrast to the start of the year, when eight of the top 10 brands had increased the level of saving m-o-m [Assosia 4w/e 6 February 2011]. However, looking at year-on-year figures, average savings are still up slightly, and Assosia MD Kay Staniland says it is too early to say whether the drops recorded this month were signs of a new trend. “At this stage this could just be a blip caused by the brands and the types of products being promoted,” she explains.
Certainly by sub-category, the picture was more mixed: the biggest year-on-year drop in savings was on carbonated drinks (6.6 points), but savings increased 5.9 points on biscuits, 5.6 points on beer & lager and 1.5 points on breakfast cereals.
Reflecting greater promotional activity in the cereal aisle, the proportion of all featured promotional space taken by cereals has increased by one point y-o-y to 3.1% and was the greatest rise outside beer & lager and confectionery (see Focus on Breakfast).
Confectionery brands with the exception of Mars, which has cut its number of promotions from 121 last month to 90 are showing a general increase in activity. The number of deals offered by Cadbury soared from 159 in the same four-week period last year to 241, with the number of Nestlé deals rising from 165 to 218.
This could be a result of intense competition between brands, suggests Staniland. “The major players are tracking each other, so it could be that they have all seen a slight gap in the market during this period and are taking advantage.”
In terms of mechanics used in the past month, there has been a drive towards deals offering straight savings, which now make up 45.3% of all featured space offers compared with 40.2% a year ago. The number of extra-free and half-price offers dipped, with the biggest fall in special purchase deals.
Published in The Grocer, 13 August 2011