Welcome Back: The Post-Summer Catch-Up in Food and Drink
It is the first week for lots of people to get back to 'normal', kids on summer holidays, post work wines in the garden (when the weather allows!) and weeks on holiday - for those lucky to get away.
It can be a time of 'what the....?!' so we wanted to share our thoughts on what happened over the summer in food and drink insights and trends!
We cover inflation concerns to shifting consumer behaviours and social media phenomena. Here’s a researcher eye view at how the summer of 2024 unfolded for the UK’s food and grocery market....
Inflation and Consumer Optimism
While grocery price inflation ticked up slightly to 1.8% in August 2024 from 1.6% in July, it remains relatively close to pre-crisis averages. Despite the inflationary pressures, there is growing consumer confidence. Shoppers are feeling more optimistic about their personal finances, although concerns about the wider economic outlook persist.
UK Supermarkets: A Competitive Landscape
Retailers are jockeying for position as they navigate shifting consumer habits:
Tesco remains the leader in the UK grocery sector with a 27.6% market share, thanks to the success of its Clubcard loyalty programme - hailed by 'adland' for it's ability to stay the course and go a long way to brand building.
Sainsbury’s saw its largest market share growth in 25 years, driven by improvements in product quality and convenience. This could be Sainsbury's finding it's place after a number of years where consumers didn't really know what they stood for.
Aldi has capitalised on changing shopping behaviours, seeing an influx of customers prioritising value, especially during a period of high living costs
Ocado and Morrisons are focusing on boosting customer engagement and expanding their loyalty programmes to retain their market share - nothing new there but you will have noticed a big push on awareness for Morrisons if you had your eyes open in the last few weeks.
Aldi’s Investment in British Suppliers
Aldi continues to make strides with its £45 million investment into the British seafood industry, showcasing its commitment to local sourcing and sustainability. This move aligns with broader efforts to secure long-term partnerships with UK farmers and suppliers, reinforcing its position as a key supporter of British agriculture that we saw pre summer and we know from our research with growers that Aldi has a strong reputation and loyal supply chain. They are also investing heavily in a store expansion programme.
Waitrose invests 1bn to store refurbs
Waitrose has had a tough time, with Kantar reporting a return to market share growth for the first time in 2 years over the summer. They will be hoping that a £1bn refurbishment programme to 150 stores will bring customers running. The revamps will be 'making it easier for customers to shop' and 'elevate products' and a focus on expanding the fresh produce offering and keeping the meat, fish and deli counters and improving cheese and bakery offerings to 'get the quality, standards and ethics'.
Is ASDA zigging when others are zagging?
While Cashpot by Asda has been critiqued across Linkedin industry commentators as being confusing to consumers and yet another loyalty scheme with little value other than price, their new Cashpot for Schools initiative is making waves by offering a fresh approach to school fundraising.
The campaign, which rewards schools with cash for app usage, raised nearly £1 million for UK primary schools within its first 72 hours. This trend reflects a broader movement in the social landscape where we see loyalty programs are increasingly designed to give back to the community rather than focus on the individual, aligning business success with social impact' and Asda seem to be leading the way. Time for Tesco to give it's tokens at the till a refresh maybe!
The Summer’s Social Media Phenomena: #BratSummer vs. #DemureSummer
Are you sick of it yet...or did it totally pass you by? The summer of 2024 was dominated by two opposing social media trends:
#BratSummer, popularised by Charli XCX, celebrated indulgence and boldness in food, this translated as featuring dishes with smoky BBQ flavours and large portions with little regard to calorific consumption or nutritional value.
#DemureSummer, on the other hand, focused on mindful eating, where fresh, simple, and light meals like salads and seafood took centre stage. This trend promoted minimalism and elegance, appealing to those seeking balance and refinement
These contrasting trends demonstrate how social media continues to shape consumer preferences in both the digital and retail spaces. Brands have tried and failed to keep up and the real winners were less focused on innovation and more focused on using what they had in their arsenal.
The latest brand trend has been around 'Gen Z wrote the script' which is interesting in this industry as it is opening up the terminology of Gen Z to other generational collectives and making it more accessible in a fun and sharable way. The insight Community have many conferences and seminars devoted to understanding Gen Z better as the consumers of the future...didn't see this cross culture clash coming though. Curry's leading the way with their social activity if you are seeking a reference point...this has translated well into M&S local tiktok presence too.
Consumer Responses to Inflation
Despite price inflation in the market, it's important to recognise that not all inflation is created equal; while some consumers tighten their belts and cut back on non-essentials, others embrace the 'lipstick effect,' opting to indulge in small luxuries like premium cuts of steak instead of dining out, thereby driving premiumization in the retail sector. As retailers navigate these complexities, gaining a deep understanding of customer behaviour is essential in succeeding in the competitive retail landscape
Additional Food and Drink Trends: Tropical Flavours and Comfort Mashups
In addition to Brat and Demure Summer, other trends emerged:
Tropical flavours saw a significant rise, with dishes like pineapple mocktails and Hawaiian-inspired meals becoming summer favourites
Comfort food mashups, like burger quesadillas and cheeseburger tacos, were another big hit, blending familiar and indulgent flavours into innovative new dishes
Economic Pressures and Frozen Foods
In response to rising living costs, many consumers turned to frozen foods as a cost-effective alternative to eating out. Sales of frozen items such as pizza and dumplings rose as households sought both convenience and affordability. At the same time, air fryers remained a hot trend, with social media users sharing recipes for healthier versions of traditional fried foods.
Nostalgic Comfort and Affordable Luxuries
Consumers have leaned into nostalgic comfort foods such as premium biscuits and cookies, which offer affordable indulgences amid economic uncertainty. These small luxuries provide emotional satisfaction while remaining budget-friendly—a critical balancing act in today’s market.
Looking Ahead
The autumn months will require retailers to balance consumer demand for indulgence with the need for mindfulness, sustainability, and value. We anticipate a big change in consumer spending habits as the squeeze hits harder and the new budget is announced.
Retailers like Aldi, Tesco, and Sainsbury’s will continue to innovate to capture shifting consumer trends, while the emerging flavours and nostalgic comforts of summer are likely to evolve and influence the festive season ahead...especially with the trend towards advance purchasing expected to be higher this year.
If you like these kind of catch ups, you can follow us on our social channels for our Food News Friday sections to make sure you don't miss anything!
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