Market-Leading Transaction Data Uncovers Key UK Grocery Trends

The UK grocery space has become increasingly competitive in recent years, as tighter consumer budgets and aggressive pricing strategies from discounters Lidl and Aldi, along with shifting shopper preferences toward online delivery and convenience formats, have forced traditional supermarkets to re-evaluate their pricing and channel strategies to retain customers. Consumer transaction data – in particular, credit and debit card data- can provide valuable real-time insights into this dynamic and critical sector. 

In July’s edition of our UK Grocery report, we use Consumer Edge’s market-leading UK transaction data panel to to shed light on:

  • Trends in spend growth and market share by retailer throughout Q2 and the first few weeks of Q3 2025
  • A look at CE data’s predictiveness for Ocado Retail’s impressive second-quarter earnings result

Key takeaways

  • Ocado and Lidl led our sales growth rankings in Q2, and have so far maintained their momentum into July. Tesco, Waitrose, Sainsbury’s, and Aldi are also performing better than the industry as a whole over the first few weeks of Q3 – while Iceland, Morrison’s, The Co-op, and Asda lag behind.
  • Lidl and Tesco have gained the most market share over the past year (2025Q3 to-date vs. 2024Q3) while Asda remained the largest share donor, losing over 1 percentage point of overall spend share over that timeframe.
  • CE’s data pointed to OCDO Retail’s better-than-expected 1H25 earnings results leading into last week’s trading update, with CE implied reported growth of +16% coming in just shy of reported sales growth at +16.3% – significantly more accurate than analyst consensus of +12%.

Quarter-to-date trends reveal UK grocery industry’s winners and losers

Using CE’s spend data, we compared individual brands’ growth against that of the overall UK grocery industry growth for recent periods (data through July 12th) to identify the best and worst performers – finding that:

  • Online grocery platform Ocado led the pack by a wide margin in second quarter of 2025, with YoY growth 13pts higher than overall grocery spend growth, and continues to outperform in Q3 to-date (+10pts) – although its margin of outperformance continues to narrow after peaking in Q1 at +17pts.
  • Discounter Lidl outperformed the industry benchmark in Q2 (+7pts), and, alongside fellow discounter Aldi, has seen its pace of growth accelerate so far in July – perhaps indicating that consumers are increasingly turning to wallet-friendly options as grocery inflation reaccelerates.
  • Both Tesco (+3pts) and Sainsbury (+2pts) managed to achieve above-average growth in Q2 despite their size, indicating that strategic initiatives in product quality (such as hundreds of new rollouts across Tesco’s Finest range), customer satisfaction, and price matching against the discounters are resonating with consumers – though Tesco’s growth has decelerated modestly into July.
  • Morrisons eked out a slightly better-than-average performance in Q2 but has since seen sales growth slip into negative territory, perhaps a consequence of planned store closures and in-store service cutbacks.
  • The Co-op dethroned Asda as the worst performer in Q2 after a serious cyberattack dented sales, though Asda has returned to last place over the first few weeks of July as Co-op’s recovery continues.

Note: Growth figures represent out/underperformance vs. overall UK Grocery spend growth; Q3 data through July 12th 2025

Market share: Tesco and Lidl continue to gain ground

CE’s absolute spend data also sheds light on industry market share and how it has evolved over time. Takeaways include:

  • Tesco remains the largest grocery retailer in the UK by a significant margin, with 29% of overall spend in 2025Q3 to-date – up by 0.4% vs. Q3 of last year. Sainsbury’s came in second place with its share relatively stable at 16%.
  • Asda was again the biggest share loser, having ceded over a full percentage point of share from 2024Q3 (12.7%) to 2025Q3 (11.6%) – putting it just 0.2% away from being overtaken by Aldi in our data.
  • Lidl garnered an additional 0.6% of overall spend over the past year – putting its total share at 7.4%.
  • The Co-op saw its share drop by 0.2% vs. last year, owing to long-running underperformance compounded by cyberattack-related issues in recent months.

Note: Share analysis excludes M&S grocery sales; Q3 data through July 12th

Consumer Edge industry data reflected Ocado Retail’s strong 1H revenue growth

Online grocer Ocado Group reported better-than expected 1H25 earnings results last week, with Ocado Retail (Ocado’s JV with Marks and Spencer) sales up 16.3% YoY – well ahead of analyst estimates of +12%. CE’s UK panel reflected this robust growth ahead of the earnings announcement, with CE “implied reported” standing at +16%, just shy of the actual number.

Source: CE Transact UK data, Constant Individual panel

Management indicated that FMCG (fast-moving consumer goods) dragged on performance in the quarter, though general merchandise – in particular, the garden and DIY categories – helped drive strong sales in April. Consumer Edge data shows that B&M did enjoy more robust customer activity in the first month of the quarter, with B&M Retail brand trailing 35D YoY sales growth outpacing industry aggregates (Discount/Club, Grocery, and Total Tagged Spend) into early May. However, performance soured in the latter half of the period, with both B&M and Heron Foods spend trailing their broader industries by a significant margin from mid-May onward – indicating that the bump from sales of outdoor-related products was short lived.

B&M’s weaker-than-expected quarterly performance highlights the volatility within the UK discount retail sector, particularly as reliance on seasonal boosts like garden and DIY sales proved unsustainable. The drop in fast-moving consumer goods demand and trailing performance of both B&M and Heron Foods in the latter half of the quarter suggest mounting challenges in maintaining growth. These trends offer a timely signal for investors and market watchers to reassess expectations in the value retail space.

The UK grocery market remains fiercely competitive as discounters Lidl and Aldi gain momentum, online players like Ocado outperform, and traditional retailers refine pricing and product strategies to hold market share. Consumer Edge’s July 2025 report uses real-time credit and debit transaction data to track Q2 and early Q3 trends, revealing Tesco and Lidl as the biggest share gainers, Asda as the largest share loser, and Ocado’s continued strong growth—aligning closely with its better-than-expected 1H25 earnings.

Matthew Volpe is an Insights Analyst for the CEIC. Follow him on LinkedIn.

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