The two hard discounters Aldi and Lidl have been tracked for decades. 2019 has probably been the year of most upheaval for their business models.
Aldi is looking to bring its two subsidiaries (South and North) much closer together and is using Big Data solutions for the first time, all a consequence of listing FMCG A-brands and becoming more price comparable.
Lidl is disrupting itself on an unprecedented scale, becoming omnichannel and digitalizing every business process, which includes the launch of a mobile payment and loyalty solution, quite a departure for a retailer that just ten years ago was a no thrills hard discounter.
The publisher has closely observed the strategic toolkit other retailers employ to combat them. One thing needs to be said straight away: there simply is no silver bullet solution to the “discounter problem” and even following the publisher's recommendations will only slow them down. The publishers don’t see a realistic possibility to aggressively regain share from Aldi and Lidl over the long term, whether the economy radically improves or not.
Whatever the competition has thrown at the discounters, their growth rates have continued, with the odd dip here and there, especially in the more mature markets, where the discounters have quickly adopted and copied initiatives, when they have been outmaneuvered for a short period.
But it is not all doom and gloom. For a start, there is a ceiling beyond which they will not grow, closely related to the maturity of their store estate. Secondly, they fiercely compete with each other, which also opens up some opportunities for those in the know-how to exploit them. And thirdly, other grocers are not standing still.
All the strategies detailed in this report have been employed by various retailers in different national backgrounds and at different times. One can certainly identify the more successful strategies that have shown some traction and one can also wonder how big the discounters would (counterfactually) be today if the tactics had not been employed by other grocers to slow the relentless advance of the discounters down to a slower tempo.
So don’t join the likes of Metro Group’s real, Spain’s Dia, France’s Casino and the various struggling UK and Dutch grocers and get this report today. Benefit from the report's insights and analysis and understand where to get ROI on any discounter fighting initiatives.
Table of Contents
- Discounters: The context, operating in a €1.0tr sector in the EU
- Discounters: The context, France, UK, Germany, Spain
- Discounters: Aldi and Lidl forcing consolidation, impact on suppliers
- Grocery Retail: EU28 2015, 2016, 2017, in €, ranked by size
- Grocery Retail: EU28 2017, in €, ranked by size, France - Denmark
- Grocery Retail: EU28 2017, in €, ranked by size, Finland - Malta
- Grocery Retail sizes: analysis and explanation
- Grocery Retail: % share of Retail, EU28 2016, ranked by size
- Grocery Retail: EU28 2017, in €, per capita, ranked by size, Sweden - Estonia
- Grocery Retail: EU28 2017, in €, per capita, ranked by size, Greece - Romania
- Grocery Retail: EU28 2012 - 2017, in €bn
- Grocery Retail: EU28 2013 - 2017, in y-o-y %
- Grocery Retail: EU28 2012 - 2017, 5-year growth rate in %, ranked
- Grocery Retail Growth: analysis and explanation
- Discounters: Aldi harmonizes PL ranges, FMCG brands, advertising, promotions
- Discounters: Aldi changes, what does this mean for the future?
- Discounters: listing in Aldi is a golden opportunity
- Discounters: Lidl’s new strategic paradigm, going omnichannel
- Lidl: premiumization, Vertical Integration, digitalization, loyalty, and US expansion
- PL proposition relaunch: the evolution of premium ranges
- PL proposition relaunch: the evolution of premium ranges, Tesco’s nest
- PL proposition relaunch: from premium to value range opportunity
- PL proposition relaunch: state of play, as discounters list FMCG A-brands
- PL proposition relaunch: Tesco’s new brands
- Strategies: private label proposition relaunch, Tesco PL switching data
- Strategies: exclusively at Tesco data, spend change vs competition
- Strategies: private label proposition relaunch, France organic PL, Carrefour
- Recommendations: private label proposition relaunch, does it work?
- Price war: poor visibility into discounters, early missteps
- Price war: It’s all about the SKUs, the structural advantage of Aldi and Lidl
- Price war: watch the German grocery market - as a warning
- Price war: what has happened in France, Aldi to buy Leaderprice?
- Recommendations: price war, does it work?
- Launching a discounter: launching or acquiring a discount fascia, fight fire with fire
- Launching a discounter: Sainsbury and Netto
- Discounters: Where Aldi and Lidl go high, Tesco’s Jack’s is going low
- Discounters: Jack’s store locations and business structure
- Discounters: Jack’s - a decidedly poor record
- Recommendations: launching a discounter, does it work?
- Convenience: Convenience, snap up sites, stop discounters from expanding
- Convenience: Service counter renaissance, food-to-go opportunity
- Recommendations: convenience, does it work?
- Online: opportunity as long as the discounters only engage sporadically
- Recommendations: online, does it work?
- Co-location: co-location and footfall sharing, Aldi partnering with dm
- Co-location: co-location and footfall sharing, Aldi USA and Kohl’s
- Recommendations: co-location and footfall sharing, does it work?
- Buying alliances: a French reaction
- Buying alliances: going pan EU, Tesco Carrefour alliance, Leclerc legal troubles
- Buying alliances: Casino and Intermarche falling foul of EU commission
- Recommendations: buying alliances
- Jack’s store
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