As grocery price wars intensify, supermarkets are spending hundreds of millions of pounds on shoppers' promotional transactions.

According to market research firm Kantar, nearly 30% of the total spending of the UK's largest supermarkets was special offers and discounts in the four weeks ending April 20.

Fraser McKevitt, head of retail and consumer insights at Kantar, said grocers have been offering substantial price cuts to stay competitive. "They invested in price cuts, which is the main driver of promotional growth," he said. "Often related to membership cards, spending on these transactions increased by £347 million. In Tesco and Sainsbury deals, nearly 20% of the items sold were in the price competition, ending up with nearly two-thirds of the basket."

Although supermarkets are usually thin in profit margins, the cost of living crises combined with the fierce competition in the industry means that some of the largest businesses in the industry have been contested to the lowest point.

Last month, Asda said it expected profits to drop significantly this year and will start investing in lower prices for shoppers. Allan Leighton, chairman of the private group with more than 580 supermarkets, said it was an "investment warning, not a profit warning." Leighton's comments are enough to eliminate about £4 billion of collective market value of the week's listed rivals Tesco, Sainsbury's and Marks & Spencer.

Since then, Asda has lowered prices on 1,500 products, including products like Cathedral Cheddar and Head & Shiefers Shampoo. Grocers said in March that its latest price cuts mean that it has lowered the price tags of nearly 10,000 products since the end of January. Despite the push, ASDA is the only supermarket to see sales drop in the past three months compared to the same period last year.

Kantar found that while promotional transactions in supermarkets are increasing, grocery prices are still rising overall. In the four weeks ending April 20, grocery inflation rose to 3.8%, the highest level in more than a year, well above the latest 1.4% in October 2024.

However, Easter period means supermarkets are still busy, and despite the price of chocolate candy rising 17.4%, its spending rose 11% over the four weeks of last year's Easter.

McKevitt said: “Last year, the amount of chocolate eggs sold through supermarket farming still grew by 0.4%, while lambs at the table are the most popular fresh meat joints, followed by beef and pork. Some families are addicted to seasonal fares as the sun is low, as the sun appears, and burger sales hit the final sale, falling 31% on top.

Kanta found that Tesco still has the largest market share, accounting for 27.8%. The second is Sainsbury's 15.3% and the ASDA is 12.3%. Ocado is the fastest growing person, continuing the trend over the past year, with sales rising 11.8% compared to 12 months ago still at 1.9%.

Aldi is the fourth largest with 11% market share, surpassing Morrisons in 2022.