Analysis: Discount supermarkets fly in face of retail wisdom to succeed during crisis

At a time when fast delivery and virtual shopping is regarded as key for drawing in consumers, Lidl and Aldi seem to have flown in the face of general retail wisdom.
Shops including Aldi introduced queuing systems during lockdown.Shops including Aldi introduced queuing systems during lockdown.
Shops including Aldi introduced queuing systems during lockdown.

The German brands – along with other discounters – have fared remarkably well during the coronavirus crisis, with sales rising by 11 per cent over the past year, according to new analysis from Mintel. Across the sector, grocery sales have risen by around five per cent, driven by the closure of non-essential retailers during the peak of lockdown and beyond.

However, while online grocery deliveries have rocketed – the Mintel report found that 40 per cent of people say they have started shopping online more – neither Aldi nor Lidl offer a full-scale online service. Aldi is currently trialling a click and collect service, while Lidl seems to have abandoned plans to go online after closing down the digital arm of its business. This all appears to be in stark contrast to what we are told consumers want: a slick website with almost instant delivery.

Read More
'Why I shop at Lidl: It was a budget-related decision'
Hide Ad
Hide Ad

The key is price. Many people have been made redundant during the coronavirus crisis, while others, although they may still be in work, fear for the future of the economy. The brands have also, potentially due to their European roots, managed to straddle that tricky chasm between budget and quality: Lidl prosecco has won national prizes, while Aldi’s Chesham bronze turkey has been named the best this Christmas in this year’s Quality Food Awards.

Aldi and Lidl have also advertised heavily during the crisis, which they are arguably more able to do than some of their competitors due to their lean operation model. They employ far fewer staff, proportionally, than the likes of Tesco or Sainsbury’s, while their store estate is also less costly – they do not have the burden of the huge hypermarket sites which the bigger brands took on a few years ago.

At a time when people want to get into a shop, pick up what they need and leave, frills and attentive customer service becomes less important. In fact, it could be argued that they become a negative at a time when people want as little contact with as few people as possible.

A message from the Editor:Thank you for reading this article. We're more reliant on your support than ever as the shift in consumer habits brought about by Coronavirus impacts our advertisers.

If you haven't already, please consider supporting our trusted, fact-checked journalism by taking out a digital subscription.

Related topics:

Comments

 0 comments

Want to join the conversation? Please or to comment on this article.