Online Grocery Growth: Lessons for UK Small Brands

E-commerce didn’t just “do well” at Christmas 2025—it grew 9.9% year-on-year and reached 13.5% of festive grocery sales, with 29% of UK households buying groceries online in the four weeks to 27 December (NielsenIQ). That’s a big shift in behaviour, and it’s not confined to supermarkets.

If you run a UK small business, this matters because grocery is a brutally competitive category: tight margins, frequent purchases, and lots of “samey” options. When digital becomes the fastest-growing channel in that environment, it’s a signal you can borrow from—whether you sell food, gifts, homeware, beauty, services, or anything in-between.

This post is part of our British Small Business Digital Marketing series, and I’m going to treat the online grocery surge as a real-world case study. The goal: practical moves you can copy to win more sales online—especially around seasonal peaks—without needing a supermarket budget.

What the Christmas 2025 grocery numbers really say

Answer first: The data shows that customers increasingly treat online as a default option for planned shopping, and they still spend on “feel-good” extras—if you make it easy and timely.

A few specifics from NielsenIQ’s festive period readout:

• £19.6bn total UK Christmas grocery spend over four weeks (up 2.5%)
• Supermarket till sales up 3%, even though unit sales fell 0.2% (people bought slightly fewer items, but spent more)
• Shoppers were more “considered”: they shopped 1.4% more often and spent 1.1% more per trip
• Online grocery: 29% of households bought online; channel growth +9.9%; share rose from 12.6% to 13.5%

What I take from that (and you should too): people weren’t reckless—they were selective. Selective customers don’t respond to generic marketing. They respond to:

1. Clear reasons to buy now
2. Reduced friction (fast checkout, delivery clarity, easy bundles)
3. Reassurance (reviews, guarantees, delivery cut-offs, stock clarity)

Online was the fastest-growing channel—here’s why small businesses should care

Answer first: Online won because it fits how people plan, compare, and buy under time and budget pressure—exactly the conditions small businesses face every day.

Christmas amplifies normal buying behaviour. When customers are busy, watching budgets, and trying to avoid hassle, they pick channels that feel efficient. Online shopping does three things brilliantly:

It turns planning into purchasing

Online grocery isn’t just “convenience”—it’s control: baskets, favourites, scheduled delivery slots, and quick reorders. Small businesses can mimic this control even without complex tech:

• Create repeatable product sets (bundles, starter kits, “restock” packs)
• Add a reorder path (email reminders, “buy again” links, subscription options)
• Make your top 10 items ridiculously easy to find (homepage, shop page, pinned posts)

It makes price and value comparisons instant

Shoppers spent heavily on promotions (NIQ: promotional spend rose to 27% of sales; other analysis cited deals making up 33.3% of festive sales). This doesn’t mean you need constant discounts. It means you need visible value.

For small businesses, “value” usually wins through:

• Bundles (save vs buying separately)
• Threshold offers (“Free delivery over £X”)
• Added extras (samples, gift wrap, bonus guide, extended warranty)

It shifts loyalty towards whoever removes friction

Online loyalty is fragile. If another option is faster, clearer, or better timed, customers switch. That’s why your digital marketing needs to focus less on “awareness” posts and more on purchase-enabling details.

Winners didn’t win by being biggest—they won with momentum

Answer first: The festive winners built momentum early and sustained it with clear offers, reliable operations, and digital experiences that support repeat buying.

NielsenIQ highlighted that retailers with “sales momentum” at the start of the quarter extended it through December. Look at the growth numbers mentioned:

• Ocado +12.8% (fastest-growing retailer for the second consecutive Christmas)
• Lidl +9.4% (fastest-growing store-based retailer)
• Sainsbury’s +5.7%, Waitrose +5.5%, Tesco +3.7%
• Asda -6.5% (and market share down, per Worldpanel)

You don’t need a loyalty card scheme the size of Tesco’s to apply the same principle. You need a plan that builds demand before the peak and keeps conversion high during the peak.

The small business version of “momentum marketing”

Here’s a simple framework I’ve found works for seasonal campaigns (Valentine’s, Easter, summer events, Black Friday, Christmas, January sales):

1. Warm-up (2–4 weeks out): content + email lead capture + product positioning
2. Activation (10–14 days out): urgency + bundles + delivery cut-offs + retargeting
3. Peak week: simplicity + stock clarity + customer service responsiveness
4. After-peak (7–14 days): thank-you emails + reorder offers + reviews + referral push

If you only show up in the activation phase, you’re paying more (in time or ad spend) for colder traffic.

The category mix is the clue: fresh food led online—so sell “confidence”

Answer first: Online grocery grew fastest where trust is highest, and trust is built through clarity, proof, and delivery certainty.

A striking stat: 32% of ecommerce sales in December were in fresh foods, making it the biggest online “super category” (NIQ). Fresh is traditionally the category people worry about online (“Will it be good quality?”). So when it leads online sales, it tells you something important: customers will buy sensitive products online when reassurance is strong.

Your equivalent of “freshness” might be:

• a service that feels risky (“Will it work?”)
• a product where quality varies (handmade goods, skincare, speciality food)
• a higher-priced item where returns matter

How to sell reassurance (without sounding needy)

Add these elements to your product pages and checkout:

• Delivery promise in plain English (timescales, cut-offs, tracking, who delivers)
• Returns/refunds that are easy to scan
• Proof: reviews, before/after photos, short case studies, UGC
• Stock and urgency honesty (“Next dispatch: Tuesday”; “Only 6 left”)

A single sentence can do a lot of work:

People don’t abandon carts because they hate your product. They abandon because they don’t trust the outcome.

Promotions rose—but premium own brand also surged. That’s not a contradiction.

Answer first: Customers want value and small luxuries at the same time—so your marketing should offer a “smart spend” and a “treat” option.

NielsenIQ reported premium private label value sales grew 5.6%, accounting for 28% of all private label sales in December. Separate analysis cited premium own-brand sales exceeding £1bn and appearing in 92% of UK baskets.

That pattern—trade down and trade up simultaneously—is exactly what many UK households have been doing under cost pressure.

What to do with this as a small business

Create a two-lane offer:

• Practical lane (value): smaller sizes, starter bundles, multipacks, refills
• Treat lane (premium): limited editions, giftable packaging, upgrades, personalisation

Then build your digital marketing around choice architecture:

• On your homepage: “Everyday essentials” and “Gifts & treats” side-by-side
• In email: one section that saves money, one section that feels indulgent
• In paid social: run separate ads to value seekers vs treat buyers

This is basic segmentation—one of the highest-ROI moves in small business digital marketing.

A 10-point festive digital marketing checklist you can run in 2026

Answer first: The fastest way to copy online grocery’s success is to improve your digital foundations, then build seasonal campaigns around timing, bundles, and reassurance.

Use this list as your campaign QA before your next peak (Mother’s Day, Easter, summer holidays, Black Friday, Christmas):

1. One clear offer per landing page (don’t make people think)
2. Bundles that reduce decision fatigue (3 options max works well)
3. Delivery cut-offs everywhere (site banner, checkout, emails, pinned posts)
4. Fast checkout (guest checkout, express pay options if possible)
5. Trust blocks on product pages (reviews, guarantees, returns)
6. Email capture with a real reason (early access, delivery alerts, small incentive)
7. Abandoned cart emails (even one follow-up recovers sales)
8. Retargeting basics (small budget, tight audiences, short windows)
9. Post-purchase flow (how-to, care tips, referral, review request)
10. A “repeat purchase” plan (reorder reminders, subscriptions, replenishment bundles)

If you do only three: fix checkout friction, make bundles, and publish delivery cut-offs. Those three alone often move conversion more than posting another five Instagram reels.

People also ask: what does online grocery growth mean for my business?

Do I need to sell online to benefit from this trend?

If you can’t take payments online yet, you can still use the same behaviours: online discovery, online reassurance, and online booking. Many local businesses win by moving just one step online (enquiry forms, deposits, click-and-collect, appointment booking).

Should I run discounts because promotions are up?

Not automatically. Use structured value first (bundles, thresholds, extras). Discounting is blunt and trains customers to wait.

What should I track to know if it’s working?

Start with four numbers:

• Website conversion rate
• Average order value (AOV)
• Email signup rate
• Repeat purchase rate (or rebooking rate)

These tell you if your digital marketing is producing sales, not just traffic.

The stance I’m taking: 2026 is the year small businesses must market for convenience

Online grocery’s Christmas surge wasn’t magic—it was a reminder that convenience is a marketing advantage, not just an operations detail. The businesses that win online make buying feel calm: fewer choices, clearer promises, faster paths to checkout.

If you’re working through your UK small business digital marketing priorities this year, steal what grocery does well: build momentum early, sell reassurance, and make value obvious without racing to the bottom.

What would happen to your sales if your next seasonal campaign made purchasing 20% easier—before you spent a penny more on ads?