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The Aldi effect: how one discount supermarket transformed the way Britain shops
- gatherhunterer 8y agoIn the U.S. Aldi is where you buy off-brands like Drinkerade and Cool-o-Cola. I have seen an inordinate amount of Aldi-related posts recently, are they planning a new strategy that is being headed off with a PR campaign?
- readyp1 8y agoIt appears so. My town already has an Aldi on one end of town, but they just bought up some land on the other side of town to open another one (much closer to the university campus). According to the PR around it, the US branch of Aldi is spending something like $5B to expand to 2500 stores (a quick Wikipedia search indicates that they have ~1900).
- Rebelgecko 8y agoAt the risk of sounding like a shill, I get a lot of amusement out of going to Aldi and seeing them toe the line of trademark infringement (e.g. Green Irish Wizard brand cereal with marshmallows, Fruit Circles cereal with a tropical bird on the box, Mad Apples cider, etc)
- maxxxxx 8y agoYou can't compare US Aldi with Aldi in Germany or Britain. The US stores have only cheap crap. They feel like it was when I grew up in Germany. Modern stores in Germany or Britain have pretty good stuff. Wish they would bring this to the US.
- ChrisRR 8y agoI'm in England and I agree with the first comment. The brand rip-offs are completely shameless. And while Lidl and Aldi do have brand names, they definitely make up less than 10% of the stock
- system2 8y agoSounds like what Trader Joes does. Although, slightly better I guess. https://www.businessinsider.com/trader-joes-sales-strategy-2014-10 https://www.businessinsider.com/trader-joes-sales-strategy-2... Less products, cheaper, better service etc.
- anoncake 8y agoAldi does what Aldi does?
- deleted 8y ago[deleted]
- crankylinuxuser 8y agoTrader Joe's is Aldi North (Nord). Aldi is Aldi South (Sud). Same company, just split between 2 brothers.
- mdhen 8y agoTotally different companies now. They do have an agreement to not compete in most countries though. The only countries both are present are Germany and the United States.
- baddox 8y agoInteresting. Aren’t such deals usually banned as anticompetitive?
- halter73 8y agoI would think so, but if the non-compete deal was made as part voluntarily splitting up the company, I could understand the argument that there's no net harm to the consumer. In my experience in the US, grocery stores have way more competition than stores in most other retail sectors. It's also one of the few retail sectors in the US where regional brands tend to outcompete the national brands. I'm not sure the main cause of that, but I'd be interested to find out.
- bsder 8y agoThe problem in the US is that the places that would most benefit from Aldi are generally the places Aldi least wants to locate at. People who drive SUVs don't need another choice for groceries--people who can't afford SUVs do.
- perardi 8y ago(I swear, not astroturfing.) I can't speak for other major US cities, but in my neighborhood in Chicago, Aldi is right there at the Wilson and Granville train stops. And those are not exactly the highest income areas.
- Rebelgecko 8y agoI live in a fairly well off part of Los Angeles but the 2 closest Aldis to me are in Inglewood and Compton, which are also not particularly high income cities.
- sokoloff 8y agoGrocery stores probably do better if they locate where people can afford SUVs than where they can’t...
- kasey_junk 8y agohttps://www.google.com/amp/s/www.marketwatch.com/amp/story/guid/03C1A8B0-9703-11E6-8F1D-BF313838A245 https://www.google.com/amp/s/www.marketwatch.com/amp/story/g... Aldi only recently moved into those locations. Their US base is actually low income neighborhoods.
- teddyh 8y agoNon-AMP link: https://www.marketwatch.com/story/discount-grocery-aldi-heads-into-wealthier-areas-2016-11-01 https://www.marketwatch.com/story/discount-grocery-aldi-head...
- robertAngst 8y agoAldi has a crazy strong marketing presence(astroturfing), and despite claim to be low cost, I have not seen that in cost comparisons https://efficiencyiseverything.com/grocer-comparison-aldi-walmart-costco-kroger/ https://efficiencyiseverything.com/grocer-comparison-aldi-wa... Crazy loss leaders get people into the store, but 1$/lb more expensive meats kill any cost savings immediately.
- vondur 8y agoHere in Southern California their meat prices are very competitive. They mainly seem to have great pricing on their own branded items. Between Aldi’s, Target and CostCo, I almost never go to a traditional supermarket.
- lightedman 8y agoTry to find yourself a Maxi Foods in SoCal. Their prices are simply untouchable when it comes to meat.
- AdmiralAsshat 8y agoAnecdotally, my grocery bill is about $20 cheaper per week if I can find everything I need for the week at Aldi, versus Safeway or Giant (local grocers in the area). Mileage may vary, of course--there's usually something I need that they don't have, which requires a trip elsewhere. Produce is usually their biggest shortcoming.
- cogs 8y agoThat's a US comparison. It's complicated to make cost comparisons - do you compare own brands or known brands, etc. But in the UK shoppers report Aldi and Lidl as being better value https://www.which.co.uk/news/2018/02/the-best-and-worst-supermarkets-of-2018/ https://www.which.co.uk/news/2018/02/the-best-and-worst-supe...
- sjg007 8y agoAldi in the us has a cheap weekly meat special on par with Costco. Fruits and veg is also cheap, and then all of the brand name knockoffs. You can find meat a bit cheaper if u shop around. I think hyvee is basically the best of all options.
- donglebix 8y agoGreat recent Freakonomics podcast on Trader Joe's...
- ekovarski 8y agoFor others interested, it's Ep 359. Should America Be Run by … Trader Joe’s? from Nov 28 2018
- sjwright 8y agoAnd for people wondering why this is relevant, Trader Joe's is owned by Aldi Nord. (American stores with the Aldi brand are owned by Aldi Süd. Nord [North] and Süd [South] are separate entities owned by brothers, and they voluntarily avoid competing with each other geographically in Europe. The easiest way to tell them apart is with their distinctive logos.) https://en.wikipedia.org/wiki/Aldi https://en.wikipedia.org/wiki/Aldi
- sidlls 8y agoThe one time I went to an Aldi is the only time I ever hope to. It was disorganized in a way that makes Costco look tidy and filthy besides. The poor selection was just icing: I'm not a brand snob but I need a wider variety of goods.
- lqet 8y agoAldi Süd started a redesign of their markets a few years ago in Europe, the Aldi in my area looks like this: https://www.handelsblatt.com/images/billig-allein-reicht-nicht-mehr/13585010/2-format2020.jpg https://www.handelsblatt.com/images/billig-allein-reicht-nic...
- rb808 8y agoI love Aldi (And Lidl) The great thing about the lack of choice means the supermarkets are small so its quick and easy to do your whole shop. Its like Costco with sensible sizes.
- chrisseaton 8y ago> its quick and easy to do your whole shop You can't do your whole shop because it's a lottery what they'll be stocking that day. They seem to just stock whatever was cheap at the time, which always makes me think someone else was trying to get rid of it for some reason. It's all random junk with no system or logic behind the range at all. Not stocking apples today, but they have a huge range of pneumatic power tools for some reason, is a typical experience. At least that's my experience of my local Aldi.
- Moru 8y agoYes, these Lidl/Aldi stores are just the old wholesale market evolved. They buy large ammount of product (whatever is cheap), split up and sell all over the world. This is why there might not be any apples but ten different sorts of paper, sunchairs and pneumatic drills.
- JdeBP 8y ago> You can't do your whole shop I tried it once. It turned out that I can. > Not stocking apples today, That is not my experience of any supermarket, ever. Although people are predicting that it might be after the end of this month.
- deleted 8y ago[deleted]
- rv-de 8y agoYou can't love Aldi and Lidl at the same time - that is not allowed. You have to choose which you love. Of course, you can still occasionally visit the other but only while bearing a subtle smirk of contempt. Like Star Wars and Star Trek or Lego and Playmobil. I'm proudly follow Aldi now in the third generation.
- temp-dude-87844 8y agoAldi is really quite bizarre, in a way the article tries to capture. For all their rock-bottom prices on store brand goods, whose quality ranges from pretty good to never-again mediocre, they stock the store with a rotating selection of random crap that fell off the boat, baiting the impulse for an aspirational or just-in-case buy. But then again, by now, Amazon's front page recommends a carousel of similar dropshipped junk from vendors whose names appear to be machine-generated. At least Aldi bothers to "curate" in the sense of commissioning most of its stock as a store brand, whereas Amazon is seemingly devoid of the slightest amount of steering from above, save for locating popular items after-the-fact and releasing an AmazonBasics. In the process, Aldi and its slightly-nicer copycats siphon away marketshare from normal stores who actually carry name-brand food and home goods you'd want to buy again, if you weren't on a misguided mission to penny-pinch. Stores pivot towards overpriced premade sandwiches, cafes and hot buffets, and meal kits that make zero economic sense, because that's where you can still pull a good margin. The middle empties out. If you look, you can see this same process play out in other areas of retail and services. Aldi's gain is our collective loss, the widespread embrace of an insincere "good enough", either because our budgets are truly crunched, or because we don't let ourselves value our mundane maintenance desires. On the far side, people who have rejected this can look like they're engaging in conspicuous consumption. Sometimes they are.
- codegrappler 8y agoYou should definitely write. I like your style of prose.
- claudius 8y agoAldi siphons away marketshare from other stores with large overheads and from brands which spend more on advertising than the products themselves. Personally I very rarely notice a difference in quality between Aldi-bought products and those from more expensive chains (e.g. Edeka or Rewe), though the latter are more hit-and-miss (never need to check the expiration date at Aldi, always have to at Edeka…) and much more chaotic. This second aspect, which makes it hard to shop quickly, combines with very slow people working the tills, meaning that the time it takes me to buy a single item in Edeka is longer than what I need to buy a whole week’s worth of food at Aldi. The random collection of stuff is mostly useless, yes, though there are some items there with sufficient regularity and quality to be worthwhile, e.g. WD-40 and tape. Clothing is typically also ok though neither fashionable nor pretty.
- drewmol 8y ago>Aldi stores has tripled since the early 90s to nearly 2,000(SKU's), although that remains tiny compared to the 25,000 or more in a big supermarket. This is why I shop at Aldi when possible. I'm willing to make small compromises on quality and overall selection for efficiency gains and less frustration. I don't want to navigate 25+ brands of canned tomatoes, disect manipulative pricing schemes (10 for $10* | * must buy 10, lesser quantities sold at $2.79/ea), subsidize add-on services I don't use like free in-store daycare or check cashing, walk to the deliberately deeply placed staple sections like produce, dairy, etc., calculate savings in expiring and unclear fuel rewards at on site gas station, or be forced to provide my private information for my purchases to be tracked and sold in order to be eligible for purchasing things at advertised prices.
- sjwright 8y agoAnd then best of all, because of the low SKU count, you can do your entire regular grocery shop in three or four aisles which is convenient. And because the canned tomatoes they do stock are of good quality, I rarely have to worry about it—at least for most staples. There are rare exceptions where I prefer a particular name brand product but I know what these are so I save them up for a visit to the traditional large supermarket every other week to "fill the gaps". Also, I am affluent enough to not be price sensitive, but I do like being able to pick up canned tomatoes without the mental load that goes along with seeing many brands of the same product and pretending that I can judge the difference in quality by the aesthetic of the product packaging.
- Moru 8y agoI read on the back of the packaging to see how much actual tomatoes I get and then I stick to the brand with most tomatoes. The first times shopping takes longer until you learn what you like, after that you can be just as fast anywhere. (Until they rebuild the store to make you confused)
- drewmol 8y agoOn canned tomatoes: https://www.cooksillustrated.com/taste_tests/510-canned-diced-tomatoes https://www.cooksillustrated.com/taste_tests/510-canned-dice...
- pighive 8y agoI am glad I found Trader Joe’s. Never have I ever been excited about a trip to super market. It rivals Costco too (in food section). Before that, I took weekly trips to Aldi/Lidl for a year, and few of their products’ quality is quite low in my opinion, and not everything is cheap.
- mhb 8y agoTrader Joe is a fun trip, but my enthusiasm is tempered by some truly disgusting house brand crap they sometimes sell as well as frequently dropping items that I like (e.g. crackable almonds in shells, half-popped popcorn).
- cm2012 8y agoThis made me laugh. I love TJs bit their house brand sriracha is just so terrible. Just stock the rooster!
- kawfey 8y agoI really liked that half popped popcorn.
- mhb 8y agoFWIW, this describes how to make it, though I haven't tried yet. https://www.flytraplife.com/blog/half-popped-popcorn/ https://www.flytraplife.com/blog/half-popped-popcorn/
- kradroy 8y agoI tried to go all out on TJs, but I couldn't make it work. They are, like one commenter above said, "the disappearing middle" even though they're kind of the bottom. Costco beats them out for most of the things I'd buy: booze, meat & poultry, bulk veggies, dairy. The only things I'll buy exclusively at TJs are berries. What's up with their soupy peanut butter too?
- blensor 8y agoBTW: Did you know that Trader Joe‘s kind of belongs to ALDI as well. It is owned by a company of one of Aldi‘s sons.
- novalis78 8y agoThis is what I have been telling Publix managers for a while now. They don’t want to want to see it either, saying that their customer service is so far advanced and thus Aldi won’t play into their territory. Oh well, we shall see.
- atombender 8y agoI don't, and likely never will, understand why anyone would want go to chains like Aldi, Lidl, Shoppers etc. to shop unless they had no choice. These are the most depressing supermarkets in the world. I can understand low cost, but why do the stores need to look and feel like you've been transported back to Cold War-era Soviet Russia? I will also never understand, I suspect, the austere attitude in Germany to supermarkets. I've only ever lived in Berlin, but I longed for a Whole Foods or at least a Trader Joe's while I was there -- Aldi, Lidl, Rewe, Edeka, they're all super depressing. Berlin has a decent selection of "bio" supermarkets, fortunately, but their selection is also frustratingly limited, and the slight increase in quality isn't really worth the increase in price. The US has plenty of terrible supermarkets, too, but they're often depressing for another reason; despite a much bigger selection, they devote an enormous amount of shelf space to disastrously unhealthy food and candy. (And then there's the bread. Very difficult to find good, freshly baked bread in the US that isn't plain white.)
- scrollaway 8y ago> I don't, and likely never will, understand… Well, I don't understand why someone would make their groceries (a major portion of monthly spendings) 2-6x more expensive just because the shopping experience is less "fun". Personally, groceries are a chore no matter where I shop. All in all I just shop wherever convenient. I live next to a Lidl right now so I shop there, and my only annoyance with it is that they don't have that much stuff (not in terms of brand choices but in terms of items altogether).
- atombender 8y agoYou misunderstood my comment. I do much of my shopping at a local low-cost chain, but it's nowhere near as depressing as the ones I mentioned. That said, being a low-cost chain, I have to make trips to several other supermarkets to completely cover my grocery needs during the week, which is frustrating.
- learc83 8y agoLidl just opened several stores in my area (metro Atlanta) and they are all modern, fairly nice looking buildings with big glass facades [1]. The insides are decent too and the bakery is much better than any of the other grocery stores around here. 1. https://www.google.com/maps/uv?hl=en&pb=!1s0x88f53d4a23219279%3A0x731c65102b4eb46b!2m22!2m2!1i80!2i80!3m1!2i20!16m16!1b1!2m2!1m1!1e1!2m2!1m1!1e3!2m2!1m1!1e5!2m2!1m1!1e4!2m2!1m1!1e6!3m1!7e115!4s%2Fmaps%2Fplace%2Flidl%2Bpowder%2Bsprings%2F%4033.8675521%2C-84.629123%2C3a%2C75y%2C29.51h%2C90t%2Fdata%3D*213m4*211e1*213m2*211st2HBWZcnhINWiE2Qwmo3YA*212e0*214m2*213m1*211s0x88f53d4a23219279%3A0x731c65102b4eb46b!5slidl%20powder%20springs%20-%20Google%20Search&imagekey=!1e10!2sAF1QipOC4QeCtzGmCNeeXTFK9pux6eF_ZEAr5mw3Llg0&sa=X&ved=2ahUKEwjdrtGH4PvgAhVKm-AKHeF5BM0Qpx8wFXoECAEQCw https://www.google.com/maps/uv?hl=en&pb=!1s0x88f53d4a2321927...
- rdm_blackhole 8y agoI like shopping at Aldi because it reduces the paradox of choice. https://en.wikipedia.org/wiki/The_Paradox_of_Choice https://en.wikipedia.org/wiki/The_Paradox_of_Choice Less choice, less time spent in the supermarket. I buy 90% of my weekly groceries there and it takes me less than 15 minutes to be out of the door. The remaining 10%, I buy at different shops as those are really specific items that Aldi does not carry. I like the low prices and the efficiency of the checkout process. Anecdote: I have noticed a saving of approximately 15% compared to when I was shopping at the competitor's stores.
- roghummal 8y ago>I like the low prices and the efficiency of the checkout process. I especially liked standing in line for five extra minutes while the customer in front of me demanded they pay a different (lower) price for their frozen pizzas because, they said, the pizzas were in the wrong spot. They eventually got the lower price. Woo Aldi. I hope they're kicking Temple Grandin a percentage. It's hard to shop at their stores without feeling like cattle being moved from one place to another. (But 15%! What a deal!)
- close04 8y ago> I especially liked standing in line for five extra minutes If one time or rare bad things were a good measure wouldn't we all end up being judged on HN based solely on our worst comments? > (But 15%! What a deal!) It is for some people.
- oblib 8y agoAldi is a favorite here in the rural Ozarks. The closest ones to us are over 40 miles away but my wife and I make a point to shop there when we're in the area. There's talk of one being built in Branson, MO, which is less than half the distance and everyone in the entire County has their fingers crossed they will. These are big issues here. Aldi's would give us all another option and save us money too. Here, a lot of the little "mom & pop" stores got killed by Wal-Mart and Lowes close to 20 years ago. Dollar Stores have now replaced them in the past few years, which is kind of strange to see because they're very similar in most ways, and they've now taken a pretty good chunk of WalMart's market share. Our first Wal-Mart in Branson is still there, and it's pretty small compared to the "Super Wal-Mart" they built there a few years ago. But locals don't really "love" Wal-Mart like they did 25 years ago. In fact, most really do not like it, but they didn't have many other choices just a few years ago because all the little Mom & Pop grocery stores had closed. The two Aldi's close to us are constantly busy. They're like a rural "Trader Joe's" for us bumpkins in that they have stuff no other stores carry, and their produce is usually a lot better too.
- pragmaticlurker 8y agowhat about the Primark effect?
- avar 8y agoThere's many comments here complaining that it's impossible to shop at Aldi because they won't have all the ingredients for whatever dish they were planning to make. This is largely true, but I feel misses the point. For a grocery store to exhaustively and consistently stock all combinations of products you need for a given dish you have in mind costs money they need to roll onto you as a consumer. Rather, the idea with Aldi is that like with a farmers' market you should see what they have in stock at that moment and then decide what to cook.
- JackPoach 8y agoThis article is really inspiring to other industries as well. You can really re-evaluate current business model based on what potentially can be done.
- deleted 8y ago[deleted]
- ahartmetz 8y ago> Second, the main chains – the big four as well as the leading “soft” discounter Kwik Save (which stocked a larger range than Aldi) – were listed on the stock exchange. The best way to fight Aldi early on is to slash prices, but few bosses of public companies are happy to accept lower profits, and thus lower bonuses, by pursuing long-term strategies. This is not at all surprising, but it's rare to see such a clear-cut (more so in context in the article) example of short-termism hurting companies.