Checking Out the State of the UK Grocery Market

Insight Flash: Consumer Edge Data Reveals Competitive Shifts and Spending Trends in the UK Sector

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 this UK Grocery industry report, we use Consumer Edge’s market-leading UK transaction data panel to to shed light on:

Trends in consumer spend by retailer over the second quarter of 2025
A look at CE data’s predictiveness for the deceleration in ONS-reported food store sales growth in May
Updated insights on Co-op’s recent sales performance following its April cyberattack

Key takeaways

Ocado and Tesco again topped the growth rankings in June, while Tesco, Waitrose, Sainsbury’s, Aldi, and Morrison also posted above-industry average performance – leaving Iceland, Asda, and The Co-op trailing behind.
Tesco and Lidl have gained the most market share over the past year (2025Q2 to-date vs. 2024Q2) while Asda was the biggest share donor, losing nearly 1 percentage point of overall spend share over that timeframe.
Co-op’s sales have recovered meaningfully after suffering a major dent due to the April cyberattack, with rolling 7D YoY growth now down only single-digits in the most recent days of data – though still trending below pre-hack levels.

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 the quarter to date (data through June 14th) to identify the best and worst performers – finding that:

Online grocery platform Ocado continued to lead the field in the second quarter of 2025, with YoY growth 13pts higher than overall grocery spend growth QTD – although its Q2 pace represents a modest deceleration from +17pts above industry growth in Q1.
Discounter Lidl (+7pts) again outperformed the industry benchmark, although its growth rate decelerated somewhat in June vs. a heady +10% (vs. industry) in May. Close competitor Aldi also regained lost ground after a soft April, accelerating to +2% vs. average in June. Both discounters appear to be benefiting as consumers cut back on premium grocery spend after “trading up” to higher-end retailers like Waitrose around the Easter holiday.
Both Tesco (+3pts) and Sainsbury (+2pts) managed to achieve above-average growth 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.
Morrisons outgrew the industry as a whole by 1% so far QTD, though growth may be poised to deteriorate as the company carries out planned store closures and service discontinuations.
The Co-op (-9.4 pts) replaced Asda (-7.9 pts) as the worst performer QTD after a serious cyberattack dented sales – though the worst of the damage appears to have passed, with relative growth improving by 7pts from May into the first two weeks of June.

*Note: Growth figures represent out/underperformance vs. overall UK Grocery spend growth; data through June 14th 2025*.

Market share: Tesco and Lidl gain at the expense of Asda and Co-op

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 2025Q2 – up by 0.8% vs. Q2 of last year. Sainsbury’s came in second place with its share relatively stable at 16.1%.
Asda was again the biggest share donor, having ceded nearly a full percentage point of share from 2024Q2 (12.9%) to 2025Q2 (12.1%).
Lidl garnered an additional 0.4% of overall spend over the past year – putting its total share at 7.2%.
The Co-op saw its share drop by 0.5% vs. last year, owing to long-running underperformance compounded by cyberattack-related issues throughout May and June.

*Note: Share analysis excludes M&S grocery sales*.

Consumer Edge industry data reflects grocery slowdown in May

UK retail sales recorded their worst monthly drop since December 2023 in May, largely owing to a “dismal month for food retailers” as consumers pulled back on food spending after splashing out in April. Consumer Edge’s UK grocery industry tracks closely with reported food store sales from the Office of National Statistics (ONS) Retail Sales Index – and reflected the deceleration from April into May, with growth falling from +6.3% to +2.5% (albeit slowing less sharply than the reported sales), as shown in the chart below.

uk grocery trends — Source: CE Transact Data, ONS Retail Sales Index – Great Britain Report (weekly retail sales value, non-seasonally-adjusted, “Predominantly Food Stores Total – Large Businesses”, June 2025 release of May 2025 data).

Co-op regains ground after hack – but it’s not back to baseline yet

A serious cyberattack in April disrupted Co-op’s delivery systems, resulting in product availability issues and even empty shelves across its store network – and impacted sales meaningfully, with 7-day rolling y/y spend down over 20% for a stretch in mid-May. Using CE’s UK transaction data, we took an updated look at the impact of the hack on Co-op’s sales, finding that:

Co-op’s 7D rolling y/y sales growth has recovered meaningfully since the end of May, improving from a ~-20% run-rate to down single-digits in the most recent days of data (though June 14th) – though it has not returned to positive territory, where it stood pre-cyberattack, casting some doubt on the company’s assertion that the business is nearing “full and complete recovery”.
Many of the other major retailers’ growth appeared to dip slightly as Co-op regained ground – perhaps indicating that customers returned to Co-op (and M&S, which also suffered a breach) after temporary detours to competitors, as stock levels recovered.

*Note: Data through June 14th 2025, growth shown relative to overall grocery industry (positive % growth = outperformance, negative % growth = underperformance)*.

The UK grocery sector continues to be shaped by fierce competition, evolving consumer behaviors, and external disruptions. In Q2 2025, leading players like Tesco and Ocado managed to maintain growth through strategic pricing and product initiatives, while discounters such as Lidl and Aldi capitalized on budget-conscious shoppers. Meanwhile, the Co-op’s recovery from its cyberattack highlights both the resilience and vulnerability of retailers in today’s environment. Consumer Edge’s transaction data not only confirms alignment with national retail sales trends but also provides early visibility into shifts across formats and operators. As market dynamics evolve, data-driven insights will be critical for navigating change and seizing opportunities in this fast-moving space.

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