British online supermarket Ocado Retail reported faster sales growth in its fourth quarter as more competitive pricing helped it win customers from rivals, underlining its position as the UK’s fastest-growing grocer.
During the Covid-19 pandemic of 2020, online’s share of the total UK grocery market more than doubled, peaking at about 15% and is currently at about 12% according to industry data.
Ocado Retail – a joint venture between Ocado Group and Marks & Spencer – said on Tuesday its retail revenue rose 17.5% to £715.8 million in the 13 weeks to 1 December.
This followed growth of 15.5% in its previous quarter, as the number of active customers increased 12.1% to 1.12 million as they shopped on the site more often.
CEO Hannah Gibson said the business had benefitted from “making sure customers can buy all their favourite M&S products, ensuring our service is near perfect, shifting our value perceptions as customers realise how much we’ve moved on price and helping new customers discover Ocado.”
Highest Level Of Sales
Ocado Retail said its average selling price rose just 0.1% – well below headline inflation – over the quarter.
It also said it delivered its highest ever level of sales over the peak Christmas trading period.
It highlighted strong sales of M&S party food from hot honey halloumi to pigs in blankets – but it did not provide overall sales numbers.
Industry data published last week showed Ocado’s sales rose 9.6% over the 12 weeks to 29 December, giving it a market share of 1.8% – up 10 basis points on the year.
Shares in Ocado Group were up 12% in early trading, while shares in M&S were flat.
Last week, market leader Tesco, number-two Sainsbury’s and Marks & Spencer all reported robust Christmas trading.
However, they all flagged concerns about rising costs and the strength of the economy and consumer demand in 2025.
Ocado Retail forecast further progress in its 2024/25 year towards its mid-term target of a “high mid-single digit” adjusted core earnings margin.
Read More: Festive Promotions And Discounts Boost UK Grocery Growth – NIQ
