Insight Flash: Real-Time Insights into the Evolving UK Grocery Landscape: Market Share, Consumer Spend & Gen Z Engagement

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 our inaugural 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 banner over the first quarter of 2025
  • Changes in market share so far in 2025 among the major grocery players
  • Brand exposure to the youngest group of shoppers, which Tesco is targeting with a recent initiative to increase presence on TikTok and Instagram

Key points

  • Ocado, Lidl, Aldi, Tesco, and Sainsbury’s have all outperformed the grocery industry average so far in 2025Q1, while Morrison’s, the Co-op, Iceland, and Asda lagged behind.
  • Tesco and Lidl gained the most market share over the past year (2025Q1 to-date vs. 2024Q1) while Asda was the biggest share donor, losing over 1 percentage point of overall spend share over that timeframe.

Tesco is already slightly over-indexed to the youngest group of shoppers (aged 18-24), so its push to engage these shoppers on social media may be a bid to further deepen its relationship with this important shopper segment.

Quarter-to-date trends reveal 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 March 20th) to identify the best and worst performers – finding that:

  • Online grocery platform Ocado emerged as the clear winner so far in 2025, with YoY growth 17pts higher than overall grocery spend growth QTD – as it built on last year’s momentum driven by increasing consumer uptake of delivery services.
  • Discounters Lidl (+7pts) and Aldi (+3pts) also outperformed the industry benchmark as shoppers continue to seek value amid ongoing budget pressure from inflation. Both retailers have aggressively grown their store networks in recent quarters, with further expansion planned for this year.
  • Tesco (+3pts) and Sainsbury (+1.5pts) managed to achieve above-average growth despite their size (the largest and second-largest by market share, respectively), perhaps indicating that their strategic initiatives in pricing, quality, and customer satisfaction are resonating with consumers.
  • The Co-op has managed to reverse its recent misfortunes, lagging the broader industry by only a point QTD after multiple successive quarters of significant underperformance – a sign that its expansion plans and focus on convenience format buildouts are paying off.
  • Morrisons narrowly underperformed the industry average, though growth may be poised to deteriorate as the company carries out planned store closures and service discontinuations.
  • Asda posted the poorest performance, trailing the broader industry by 8pts, as it continues to wrangle with operational challenges and customer experience issues following its takeover by a PE firm several years ago.
Note: Growth figures are out/underperformance vs. overall UK Grocery spend growth; data through March 20th 2025

Market share broadly stable YoY, though Asda lost ground while Tesco and Lidl gained

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

  • Tesco remains the largest grocery retailer in the UK by a significant margin, with 29% of overall spend in 2025Q1 – up by 0.7% vs. Q1 of last year. Sainsbury’s came in second place with its share stable at ~16%.
  • Asda was the biggest share donor, with its portion of the market decreasing by over a full percentage point from 13% in 2024Q1 to 12% in 2025Q1.
  • Lidl garnered an additional 0.5% of overall spend over the past year – putting its total share at 7%.
Note: analysis excludes M&S grocery sales

Tesco turns to TikTok

CE’s UK Cohort data also offers users the ability to go beyond analysis of high-level sales trends and dig into the composition of companies’ sales by demographic group, geography, and more. Using CE’s breakout of brand sales by age, we evaluated major grocery brands’ exposure to the youngest cohort of shoppers (aged 18-24) in light of Tesco’s recent push to increase engagement on social platforms TikTok and Instagram, finding that:

  • Compared with the grocery subindustry as a whole, Tesco is currently slightly over-indexed to the youngest group of shoppers, with a brand-to-subindustry index of 1.1x – suggesting the banner wishes to double-down on its exposure to an already important customer segment.
  • That said, Co-op, Asda, and Iceland all have higher exposure to 18-24s than Tesco, perhaps reflecting this demographic’s preference for convenience (Co-op) and value (Asda and Iceland).
  • Waitrose was the least exposed to the youngest group of shoppers, with a brand-to-subindustry index of just 0.3x.
Note: Index calculated as (percentage of brand shoppers belonging to demo group)/(percentage of subindustry shoppers belonging to demo group); data refers to last twelve months

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Michael Gunther is the VP Head of Insights for the CEIC. Explore more of his insights here and follow him on LinkedIn.

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

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