Mercadona, Lidl up Spanish market share on fresh fish drives

Spain’s largest retailer Mercadona has increased market share in value by 0.6 percentage points to 21.1% year-on-year, while Lidl’s share has nudged up by 0.4 percentage points to 3.1%, according to a Kantar Worldpanel report on Spanish consumption.

Both are part of the ten largest retailers in Spain, which represent 52.9% of the market share for consumer goods in the country.

Source: Kantar Worldpanel

Top ten Spanish retailers’ market share in value. Source: Kantar Worldpanel

Mercadona’s growth is driven particularly by sales of fresh products, where the share has reached 17.5% in 2014, up one point from the previous year (see image on the right).

“In September 2013 we implemented throughout the chain a new model to sell fresh fish, sourcing it from local fish markets’ auctions that reaches our stores in less than 24 hours,” a Mercadona’s spokesperson told Undercurrent News.

“Our customers’ feedback is being good, as a result of the improvements made. In fish, we have registered a growth of more than 5%,” she said.

Source: Kantar Worldpanel

Mercadona’s fresh products market share increase in value. Source: Kantar Worldpanel

In June last year, Mercadona’s fresh fish push was already beginning to bear fruit, the company’s director for meat and seafood supply Rafa Berrocal said at the XV AECOC congress on seafood products held in Spain.

In the first quarter of the year, Spain’s largest supermarket chain increased its fresh fish market share in volume by 13.5 percentage points to 17.6%, when compared to the same time a year ago.

The increase is a result of Mercadona’s new drive on fresh fish. This reversed its previous strategy of selling fresh fish as if it were dry goods, Berrocal said.

From 2005 to 2008, Mercadona went on a drive to replace its fresh fish counters with pre-packed fish — largely via the processing company Caladero.

During that time sales dropped, impacting profits.

“In fresh fish, we weren’t giving the freshness demanded by our clients and, from the point of view of the processing chain, our final product was bad,” Berrocal said, citing clients’ feedback to Mercadona.

The problem was in the treatment of fresh fish “as if it were a soft drink can”.

Mercadona supplied all its fish in trays, showing the date on which it was pre-packed but not when it was caught or landed.

As the pre-packed move did not go as planned, the retailer ended up acquiring Caladero in October 2010 and, since then until September 2013, Mercadona has turned to locally sourced, fresh fish in a bet to aim for higher freshness and quality.

Since then, Mercadona has made changes in its supply and sales strategy, applying new administrative and electronic systems for traceability.

Berrocal said in June Mercadona was buying fresh fish from 80 fish auctions and adapting its supply to 700 stores based on the availability of the fish in local fish markets.

Lidl’s pre-packed fish move pays off

Lidl, for its part, has increased market share on the back of packed and fresh products, both up by 0.4 percentage points year-on-year, according to Kantar (Source: Kantar Worldpanel).

Source: Kantar Worldpanel

The German discounter aims to meet the needs of consumers in Spain by offering a larger range of products, particularly fresh and local goods, a Lidl’s spokesperson toldUndercurrent.

“The introduction of a new range of fresh fish has certainly contributed to this growth,” the spokesperson said.

Since 2012, Lidl has pushed on chilled fish in Spain, distributing seafood in pre-packed trays.

Three years ago, Lidl introduced 12 references of chilled seafood in a few stores. Today, the discounter supplies more than 20 seafood references in 230 outlets, approximately, almost half of Lidl’s stores in Spain, on the back of the customers’ good response, the spokesperson said.

The discount retailer has increased distribution of seafood in modified atmosphere packaging (MAP) trays, supplying largely by seafood producer Isidro de la Cal.

La Coruna-based Isidro de la Cal expected sales to reach above €55 million in 2014, after the company invested €1.5m to increase production for MAP trays from 6,000 metric tons to 10,000t by the end of 2015, in a move driven by the expansion of Lidl in Spain.

“Gradually, we are expanding the number of stores offering fresh fish and we expect all our clients can buy fresh fish from all over our 530 stores in Spain,” a Lidl spokespersontold Undercurrent in February last year.