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Tesco and Sainsbury’s best positioned as online grocery demand set to remain high

Coronavirus has transformed online take-up in the grocery industry and evidence is growing that thes..

Coronavirus has transformed online take-up in the grocery industry and evidence is growing that these elevated levels are likely to persist.

UK online grocery penetration has doubled during the Covid-19 lockdown to around 13%, with the big supermarket groups all reporting sharply increased growth in their delivery services.

On top of industry data showing the change in food buying patterns, analysts at UBS say their research indicates the higher level of online grocery use are “likely here to stay, though the dramatic growth will likely normalise”.

Over the past three months, the Swiss bank has been tracking consumer's intentions in terms of spend and behaviour on a range of sectors and sub-sectors.

Using these surveys, the analysts have been trying to gauge intentions of consumer spending in aggregate as well as channel preference both in the near term and as things begin to normalise and lockdown conditions are lifted.

The data shows 88% of those households shopping online say that their grocery spend online will remain the same or increase in the coming fortnight, 71% of those said they will shop online as often or more after the Covid-19 situation improves.

Whats more, 41% of consumers now think the Covid-19 crisis is only going to improve in 2021 compared to 13% back in April.

Tesco PLC (LON:TSCO) and J Sainsbury PLC (LON:SBRY) are the best positioned of the grocers, the UBS analysts believe, reiterating their buy recommendations for both FTSE 100 groups.

The UBS Evidence Lab research of grocery app download data shRead More – Source
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