Sainsbury's continues to lose ground to its supermarket rivals, fresh data showed on Tuesday, painting a stark picture of why the merger with Asda has been proposed.
Grocery industry data from Kantar Worldpanel and Nielsen showed Tesco and Morrison holding onto their market share in the face of the continued assault of the discounters Aldi and Lidl, while Asda posted a encouraging growth but lost market share.
Sainsbury's sales increased just 0.2% in the 12 weeks to 22 April, Kantar said, down from 0.6% a month ago and the orange-branded group's slowest pace of growth for more than a year. This meant its market share shrank to 15.9% from 16.2%.
Asda, meanwhile, grew sales 1.4% but this was not enough to prevent its market share dropping 0.1% percentage points to 15.5%.
The proposed merger between Sainsbury's and Asda would therefore result in combined grocery market share of 31.4%.
Current market leader Tesco held onto its 27.6% market share as it increased sales 2.1%, following five consecutive periods of 3%-plus growth.
Morrisons also held its ground in fourth place, with 10.5% of the market after a period of 2.2% sales growth.
Kantar also revealed that the fastest growth came from Ocado, growing sales 12.7% to increase its market share to 1.2% from 1.1% and achieve the rare feat of eclipsing Aldi's 7.7% and Lidl's 9.1% growth.
For Nielsen, Asda's had the most performance of the top four supermarkets, with sales up 2.3%, with Sainsbury's up 0.2%. Asda's share of the grocery market was put at 13.9% and with Sainsbury's would come to a total of 28.8% if a merger went ahead, versus Tesco's 27.1% after sales growth of 2.1% in the past 12 weeks. Marks & Spencer sales fell 0.9%.
Unpredictable weather disrupted grocery spending, Nielsen found, particularly compared to last year when a mini heatwave in mid-April gave a significant short-term boost to sales.
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, noted that Asda achieves nearly two-thirds of its sales outside London and the south east of England in contrast to Sainsbury's, which registers 59% of its sales in those two areas.
"This is a pivotal moment for the British grocery market. A merger between Sainsbury's and Asda would transform the traditional landscape placing nearly a third of market share in the hands of the joint supermarket giant, though the march of the discounters - and any enforced store closures - could impact this figure."
He pointed out that Sainsbury's appeal to more affluent shoppers saw the ABC1 demographic account for 62% of all sales in comparison to 46% of sales at Asda, with Sainsbury's premium own-label line 'Taste the Difference' contributing sales of £832m annually, more than twice Asda's 'Extra Special' range.
Looking ahead, Nielsen's UK head of retailer insight, Mike Watkins, said that sales momentum will be kick-started by any sustained period of warm weather and the proximity of the two bank holidays in May plus the Royal Wedding.
"This is all good timing, with the activation of promotions around the football World Cup kicking off soon after. These three events should be enough to return the industry to volume growth during the next eight weeks."