Supermarkets are getting a quiet boost as entertainment spend booms online

 
Harriet Green
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In the UK, one third of our spend on entertainment - so on CDs, DVDs and games - is now done online.

Data from Kantar Worldpanel, covering the first part of this year, show that one in every three pounds people spend on physical entertainment objects is online.

Interestingly, 20 per cent of all online entertainment spend was done by those aged over 55, significantly higher than the 16.5 per cent accounted for by the tech-savvy under 25s.

The growing spend is buoying big players in particular, as multi-type product sites continue to rise in popularity. It comes as no surprise that online giant Amazon's reaping in the payoffs, and there are other winners like Game, which has markedly grown its market share as it prepares to list on the stock market.

The former's now the UK’s top entertainment retailer, taking two-thirds of all sales on physical entertainment products made online. It also accounts for one in five of all products sold.

But there’s another group who are doing well within the market: supermarkets. They now hold a combined 41 per cent share of the market. Tesco makes up 15.8 per cent, Asda has 12.9 per cent, Sainsbury’s nine per cent and Morrison 3.3 per cent. There is, however, a catch: although the stores are succeeding when it comes to the entertainment market, that isn’t stretching across the whole of online.

Sainsbury’s is the only one of the four that hasn’t been really struggling to retain its customer base, with sliding profits and online sales nowhere near what they could be. Kantar says supermarkets have been noticeably late to the market, failing to make shoppers aware what’s available online. “There is a huge opportunity for supermarkets to develop their online entertainment stores, particularly while their online grocery businesses are growing at 20 per cent.”

So although they account for almost half of the entertainment market, they only take four per cent on the online spend.

That said, Tesco actually performes strongly within the online video market, replicating its in-store success with the same products. It was the UK’s number one retailer in the first part of the year, doing particularly well on blockbusters. 25 per cent of sales of Disney’s popular Frozen and 3D spectacular Gravity were at Tesco.

Game’s also fared well over the last quarter, boosting investor optimism prior to its float. Its increased its market share by 1.7 percentage points, to over six per cent of the total entertainment market, despite just selling games.

Kantar emphasises its specialist and reliable nature: it’s somewhere people know they can get Xbox One and PS4 games from, which means it attracts almost a third of all spend on next generation games.