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What's gone wrong at Asda? (news.sky.com)

submitted 5 months ago by Emperor to c/unitedkingdom

3 comments fedilink hide all child comments

While attention has inevitably been on the first rise in grocery price inflation since March last year, the latest till roll data from Kantar Worldpanel also contains valuable insights into the grocery market itself.

The figures highlight in particular the continued success of the biggest two players in the market, Tesco and Sainsbury's, in terms of pulling away from the rest of the pack.

Asda, on the other hand, looks to be in a very bad way.

Its market share during the period fell to 12.6%, down from 13.7% a year ago, which is an astonishing fall from grace.

It does not seem that long ago that Asda first overtook Sainsbury's to become the market's second-biggest player - an event celebrated by Tony DeNunzio, Asda's then chief executive, by giving all 125,000 UK employees an extra day off.

In fact, though, it was as long ago as August 2003 - when Asda, then owned by the US giant Walmart, had a 17% market share and Sainsbury's was at 16.1%.

However, following a turnaround under then chief executive Justin King, Sainsbury's recaptured the number two spot in 2013.

The pair went on to be neck and neck for most of the next few years but Asda has not had the number two spot since late 2019 and, since then, Sainsbury's has been on top.

So what has gone wrong at Asda?

In short, a great deal of upheaval.

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[–] Emperor 8 points 5 months ago

I imagine Aldi and Lidl have taken a chunk of their budget-focused customers - I now do the Big Shop at Aldi and pick up a few bits at Asda (Aldi expanded their range into brown rice and tins of pulses which pretty much took away the bulk of the items I was still buying at Asda).

However, despite this:

In the meantime, Asda's high borrowing has weighed on it, something which did not go un-noticed by the Competition and Markets Authority which, in an investigation last year into whether motorists were being over-charged for fuel, singled out a loss of competitiveness at Asda - previously seen as the industry leader when it came to cutting petrol and diesel prices.

I still buy my petrol from them as it's the cheapest in the area.

I also noticed that they introduced a rewards card, which seemed like a desperate measure at the time, moreso now.