Shoppers are ditching their favourite brands for supermarkets' own labels as they fight off spiralling prices, a report revealed yesterday.
Irish take-home grocery sales fell by 4.5% over the 12 weeks to February 20, the latest figures from analysts Kantar show.
Grocery prices went up 2.4% over the past 12 weeks, the equivalent of a steep rise of 10% a year.
The number of products on promotion fell by more than 10% year on year as supermarkets sought to manage spiralling supply costs.
Kantar retail analyst Emer Healy said: "Prices are rising across the board and that's being felt at the grocery tills.
In Association with
"We're now starting to see this reflected in shopper behaviour, with people increasingly opting for private-label lines over branded products in an attempt to drive down the cost of their weekly shop."
Lidl is facing the inflation crisis head-on with an advertising campaign pushing its 'inflation buster' prices.
The switch in shoppers' behaviour was "in the teeth of inflation and it's a reaction that makes perfect sense", according to Consumers' Association of Ireland chief Dermott Jewell.
'People are doing it to match a budget that's now under consistent pressure,' he said.
Shoppers also reverted to the discounters soon after the economic crash in 2007/8.
"It took quite some time for people to trust non-branded products that they were not born and raised with. It took a little while for it to sink in," Mr Jewell said.
"People started to shop around and split their shopping between what product they like and what was affordable in one supermarket or another. The financial crisis took a huge chunk out of an awful lot of pockets. It created an awareness of the value of money, and here we are again.
"People are struggling. Some are managing to come to terms, but if you look at the way petrol and diesel fluctuate on a weekly basis, it shows the struggle that's ongoing. Loyalty is important but the bottom line for consumers is pricing. Loyalty holds little value when it comes to the actual household budget," Mr Jewell added.
While people are switching brands, spending still remains 11.1% higher than before the pandemic as there has not yet been a full return to prepandemic levels of eating out. Lidl got a boost from new shoppers who contributed an extra €4.1million to overall sales this period. Aldi also gained market share over the past 12 weeks and now accounts for 11.7% of total sales.
'Supermarkets have been quick to respond to growing concerns over the cost of living through targeted ad campaigns and voucher schemes.
These kinds of tactics will only become more important as grocers battle for the biggest slice of consumer spend in a challenging environment,' added Ms Healy.
Online shopping is also on the decline, she said.
'Shoppers are returning to stores and getting less delivered, and we've seen a 15% drop in online grocery sales to the tune of €9.4million in the last four weeks as a result,' she added.
'The growth of online grocery which we saw during the pandemic is now beginning to stabilise and has reached a natural ceiling as we ease back into life out of lockdown. The bad weather throughout February did also help to level out online sales over the past few weeks.'
Lidl director Aoife Clarke said: 'At a time when inflation is at the forefront of everyone's mind, we decided to take a very direct approach with our "Inflation Busters" campaign.'
