Grocery spend in the four weeks ending December 30 hit £10.5 billion, equivalent to a 3.7% year-on-year rise, according to new data released today by Nielsen. The combined market share of the two German supermarkets stood at 11.8%, up from 10.4% a year earlier, attracting almost one million additional households during the period, Kantar added.
Tesco sales rose by 3.1% although its market share narrowly fell, by 0.2%, to 28%.
The nation's biggest supermarket chain saw sales rise 3.1% in the three months to the end of December, cementing its 28% share of the United Kingdom grocery market.
The research found that among the retailers, Aldi and Lidl are level pegging in the battle to be the nation's fastest growing supermarket, both growing sales by 16.8% year-on-year.
"With inflation outpacing income growth, shoppers continued to see more of their spending power absorbed by essential items, including food, leaving less left over for buying Christmas gifts". Aldi's market share rose from 6% to 6.8% in the final three months of the year, while Lidl now holds 5%.More news: Apple vows new parental controls amid child addiction fears
With Christmas Day falling on a Monday, Tesco Express branches, like other convenience stores, were able to benefit from restricted Sunday opening hours for larger supermarkets and were able to capitalise on consumers wanting to do their shopping closer to home immediately before the big day, Kantar said. Excluding the discounters, sales were up 2.3 per cent.
According to Nielsen, Tesco recorded the largest sales of the big four United Kingdom supermarkets in their busiest period of the year and had the most improved performance over the final 12 weeks of 2017. Despite this, the grocer's market share declined by 0.2 percentage points to 15.3%.
According to figures from the British Retail Consortium, food sales for the three months to December rose 4.2%, their biggest rise in six months.
Morrisons increased sales by 2.1% - with strongest growth coming from ambient and frozen foods - though the grocer's market share fell by 0.2 percentage points to 10.7%. Sainsbury's share dipped slightly, going from 15.8 per cent to 15.5 per cent.
Sales at Waitrose increased by 2.3%, but fell by 0.2% at Co-op, as the retailers captured 5.2% and 5.8% of the market respectively.
Online sales played a key part, with 18 per cent of households shopping online for groceries in December (up from 16 per cent last year). Supported by a 7% boost for own label sales, more than half of the increase came from products beyond the retailer's traditional frozen lines.