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Retail Prices: Top grocery brands offering greater savings to shoppers

The Grocer

Supermarkets have given cash-strapped British shoppers cause for optimism over the past month. While the country shivered and grumbled through a gloomy January, most of the 10 biggest-promoting brands stepped things up a gear and increased the savings they offered consumers.

In the four weeks to 6 February, the average level of saving on promotional deals was a hefty 8.6% more than the previous month and 7.3% more than the same period last year, according to Assosia’s latest Promo Dynamic data. Of the top 10 brands, only Kellogg’s failed to provide a better average saving.

The total number of promotions edged up 0.9% month-on-month but rose 2.6% year-on-year. This is quite a turnaround considering that the fixtures over the Christmas and New Year period carried nearly 7% fewer deals than the previous year.

“Promotion escalation is very significant at the moment because there is an unprecedented squeeze on expenditure and consumers are increasingly deal-hungry,” said Aidan Bocci, CEO of consultancy Commercial Advantage. “This throws up the question: do consumers really know what the true value of a product is now?”

One area where deals did drop off, however, was confectionery. Despite Easter eggs arriving on shelf and Valentine’s Day approaching, the end of the festive promotional push has resulted in Cadbury surrendering its long-held position as the biggest-promoting brand. The supplier recorded a 38.3% month-on-month reduction in deals. It was a similar story for other confectionery brands, with Nestlé accounting for 14.3% fewer deals, while Mars dropped out of the top 10 rankings altogether.

Cadbury was replaced at the top of the rankings by Birds Eye. A £1m promotional push produced a 34.9% month-on-month hike in the frozen food giant’s promotions, with it halving the price of a number of top sellers.

Straight money-off deals such as this have become increasingly prevalent over the past month, according to Assosia MD Kay Staniland. “While x-for-y deals can create volume sales, they can limit repeat purchases and so the brands are focusing on providing significant savings, which will entice consumers to repeat purchase,” she said. Heinz rose 15 places to become the 10th-biggest promoter following increased deals on babyfood and soups.

Published in The Grocer, 12 February 2011