Supermarket chain Tesco (LON:TSCO) has made a disappointing start to the festive season according to the latest data from Kantar Worldpanel.
The market data firm reported sales at the retailer dropped 3.4%, in the 12 weeks to December 6, to £7.5mln compared to £7.3mln over the same period in 2014.
Sales continue to slump – Tesco’s revenue was around 2.5% lower in the previous 12-week period – due to the sustained rise in popularity of discounters Aldi and Lidl.
UK shoppers are being lured away from the "big four" supermarkets by the German discounters, which reported sales hikes of 15.4% and 17% respectively.
Fraser McKevitt, head of retail at Kantar Worldpanel, said: “Things remain tough for Tesco and Asda, with both seeing a fall in sales of 3.4% as consumers drift away from larger stores towards the discounters.”
It’s not all bad news, he noted, as both Tesco and Asda managed to increase sales online.
Elsewhere, Morrisons (LON:MRW) has started to feel the impact of selling 130 of its M Local convenience stores, with revenues down by 2% to £2.8mln.
Sainsbury’s (LON:SBRY) bucked the trend, however, as sales rose around 1.2% to £4.3mln, and its market share rose to 16.7%.
Kantar’s McKevitt said customers are buying its Taste the Difference range, "with sales of champagne and sparkling wine up by a quarter it seems clear that the grocer is successfully tapping into demand for premium goods."
He added that its success pre-dates its popular ‘Mog’s Christmas Calamity’ advert, with the retailer now having grown ahead of the market for three months in a row.