A lot can change in ten years. One of the biggest shifts over the last decade has been the way we shop. At the start of the 2010s, the then top 4 supermarkets (Tesco, Asda, Sainsbury's and Morrisons) accounted for more than 75% of all grocery sales. That share has dropped to 65%... and we have a different top 4 as Aldi kicks Morrisons out of the number 4 spot.
At one time, there was an obvious class division across UK supermarkets, Waitrose was for the most affluent shoppers and the Discounters were a small part of the repertoire for less affluent families.
Shoppers saw their choice of supermarket as a reflection of their social status, and whilst we still have the Waitrose stereotypes, we have seen a dramatic shift in perception for the likes of Aldi and Lidl.
Today, over 79% of people in the UK have shopped in Aldi or Lidl in the last year. Their combined market share of 16.4% makes them bigger than Asda and Sainsbury's. If the stigma still exists, it’s certainly not putting people off shopping there any more.
I started shopping in Lidl five years ago and over time it has become a more regular feature in my shopping routine. Like others who adopted a discounter, there were a few reasons for my first visit:
A new store opened nearby.
Despite the changing dynamic of the UK retail landscape, store location remains our first priority for store choice. Aldi and Lidl are constantly opening new stores, so they are naturally increasing in our consideration. If both companies achieve their targets for new stores, they will have grown from 1,600 stores today to over 2,200 stores by 2025.
Recommendation from family and friends.
There is still a social status attached to your choice of supermarket, but nowadays people take more pride in being savvy than being extravagant.
My sister was the one who convinced me that it was worth shopping in Lidl, her recommendation unsurprisingly was based on...
Value for money.
Price remains the main trigger for attracting new shoppers to these stores, but we are delighted by the quality, convenience and experience provided.
According to an IGD survey, 71% of people shopping in Aldi or Lidl believe that “the quality of products has improved over the last couple of years”.
A few years after becoming a Lidl shopper, here’s what I can tell you...
1. Yes most things are cheaper, but it’s not about the absolute price of each item.
As much as we talk about shoppers comparing prices across stores, the main place they notice the savings is at the till.
When it comes to branded items, the range is increasing but prices aren't always that competitive - I have paid more in Lidl for items like Nutella and Linda McCartney Burgers than if I’d bought the same items on deal elsewhere.
The biggest savings are on items where shoppers are happy to trade down from brands into own label, for me this included dishwasher tablets and herbal tea, which were half the price of the branded equivalent.
2. Shopping around goes hand-in-hand with Discounter shopping.
Shoppers regularly tell us that you can’t buy everything you need in Aldi and Lidl.
I have only shifted a proportion of my spend to Lidl, not just for those items I can’t get but also for the convenience of shopping online or getting multiple things under one roof. When you urgently need to buy a birthday gift (or a kitchen appliance), you can’t rely on the middle aisle of wonder to have what you need.
It’s not unusual for shoppers to visit more than one Grocery store even in the same day, in fact trips starting with a Discounter are much more likely to include another retailer to pick up the bits they couldn’t get.
3. To shoppers Aldi and Lidl low prices aren’t the same as Every Day Low Prices.
There is a phenomenon we all experience as shoppers that I like to call “bargain-dorphens”.
“Bargain-dorphens” are that little buzz you feel when you’re getting a bargain, when you’ve been let into a secret deal.
When supermarkets implement Every Day Low Prices (EDLP), shoppers don’t get that buzz, even if it ends up being cheaper for them than a promotion. Shoppers do get that feeling in Aldi and Lidl without promotions, because they know that they are saving vs. what they would have paid elsewhere.
4. The big shopping events are the Discounters time to shine.
26% of shoppers in the UK claim they tend to do more of their shopping in discount stores in the run up to Christmas. The cost of Christmas is overwhelming for most shoppers, and we typically spend 20% more on food & drink in December than we do any other month of the year.
Aldi and Lidl both have some pretty great products available including groceries for your Christmas meal, party food, loads of festive booze and even luxury hampers. They also cleverly play to their German roots with items like Glühwein and Stollen.
When it comes to events, the in store experience is hardly magical but you get some unique items and save a few pennies at a time when you most need to.
5. Convenience means different things to different people, at different times.
For many shoppers, in comparison to shopping in a big box supermarket like Tesco Extra or an Asda Superstore, Aldi and Lidl are much easier. They often tell us it's easier to park and much quicker to get round. This is how I feel when I need to pick up a few unplanned bits, Lidl is much easier.
But not always for the big shop. I’ve shopped online for years and I tend to buy the same things every week, making it really easy to swipe through my favourites list and get my shopping delivered the next day. Even though Lidl is a 5 minute drive away, on a busy week, it’s much easier to book an online shop.
6. The Big 3 (and Morrisons) need to keep winning on customer service.
Where Tesco, Sainsbury’s and Asda completely outshine Lidl in my experience is customer service. This is where you absolutely get what you pay for. I would be unlikely to ask a member of staff in Lidl for help, if I can’t find something I’ll assume it’s not there.
Customer service is a much more important factor than price for many shoppers, particularly those who are elderly or disabled, and I really hope that the big supermarkets don’t lose sight of that.
It’s clear to see why Aldi and Lidl continue to grow as they do, as quality improves the value perception becomes even stronger. But there’s also a few clear reasons why most Discounters shoppers, like me, are still going to the another big supermarket.
It looks as though we’ll be a nation that shops around for a while to come.
There’s no better way to understand your shoppers than getting out to store with them, get in touch to find out how I can help you organise a shop-a-long!
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