Asda, the prominent supermarket chain, faced a 7% decline in sales, exacerbating its ongoing challenges. Market analysts from NielsenIQ reported a further drop in Asda’s market share from 12.2% to 10.9% in the last three months.
Acquired by billionaire brothers Mohsin and Zuber Issa along with TDR Capital in 2021, Asda has been striving to navigate its difficulties. Under TDR’s control, the company appointed veteran executive chairman Allan Leighton to spearhead a revival effort, leveraging his successful turnaround strategies from the 1990s.
Despite announcing extensive price reductions in March, including the largest in 25 years, Asda’s sales continued to plummet. The supermarket disclosed plans to intensify discount offerings, aiming to undercut competitors like Tesco, Sainsbury’s, and Morrisons by 5% to 10%.
Contrary to Asda’s struggles, Tesco and Sainsbury’s experienced sales growth of 4.5% and 5.2% respectively, during the same period. Aldi, a discount retailer, closely trailed Asda with a market share of 10.3%.
An Asda spokesperson acknowledged the challenges, emphasizing ongoing efforts to enhance customer experience through improved availability and competitive pricing. The company remains optimistic about its strategy to reestablish itself as the UK’s most cost-effective traditional supermarket.
In a bid to attract more customers, Asda launched a Christmas advertising campaign featuring The Grinch. Meanwhile, NielsenIQ projected that UK households would spend £20 billion on Christmas groceries, with expenditures peaking at £5.7 billion the following week.
Mike Watkins, NielsenIQ’s head of retailer and business insight, noted a trend of budget-conscious Christmas shopping this year. Shoppers are strategically managing expenses to indulge in festive treats while making savings on routine purchases.