Supermarket giant Tesco has reported achieving its highest market share in more than a decade, driven by a solid rise in sales over the crucial festive trading period.
Festive Performance Drives Market Gains
The UK's largest grocery chain saw a 3.3% increase in like-for-like sales across its UK and Ireland operations over the six weeks to January 3rd. This growth was split between a 3.2% rise in the UK and a stronger 3.8% uplift in Ireland.
This positive performance followed a robust third quarter, where sales grew by 4% in the 13 weeks leading up to November 22nd. The cumulative effect significantly boosted Tesco's position in the highly competitive grocery sector.
Market Share Reaches New Heights
According to data from Worldpanel, Tesco increased its overall market share to 28.7% in the three months to December 28th. This figure surged to an impressive 29.4% during the key Christmas trading month alone, marking the company's strongest hold on the market in over ten years.
Chief Executive Ken Murphy attributed the success to strategic investments. "Our investments in value, quality and service drove further gains in customer satisfaction and strong growth in fresh food," he stated.
Profits on Track Amid Intense Competition
The strong Christmas performance means Tesco is now on course for annual profits at the upper end of its recently-upgraded guidance, which forecasts earnings of between £2.9 billion and £3.1 billion.
However, the company noted that the 3.3% festive sales growth represented a slight slowdown compared to the 3.7% rise reported for the same period the previous year. Murphy acknowledged the challenging landscape, saying, "Competition is as intense as ever and we know value remains a priority for customers."
In a direct move to counter discount rivals like Aldi, Tesco recently announced the return of its iconic blue-and-white striped value logo, which it had retired in 2012. The company stated this would be central to a major marketing campaign emphasising low prices on branded products.
