Aldi: Boom of Britain


With news emerging that Tesco, Britain’s largest retailer have suffered another loss to their market value, dropping to an 11 year low of 8.5%, budget superstores such as Aldi and Lidl are at their prime. Katie Parker investigates how the European food mecca, Aldi has taken over the British supermarket industry and why it is successful.


Recession
When the recession hit Britain in 2008, the population were scrimping and saving, making cuts to all parts of their lifestyles. As citizens wanted to save every penny, they started shopping around and comparing the prices of everyday products in order to get the best outcome. It was reported that the cost of spending in the following years until 2011 has been compared to that of those in 1920’s.

Supermarket Wars: Aldi towers over competition (Picture by Katie Parker)

The Rise
Fast forward into 2014, and recent statistics have shown that the ‘Aldi Effect’ is stronger than ever. The survey was taken by market research specialist, Kantar, showing that the brand are 30% up on sales than the previous year. It even calculated that 50.1% of the nation have shopped at an Aldi store since September of this year.

Today Aldi have over 530 around the UK, and they have revealed plans of creating over 5,500 jobs in the UK this year lowering unemployment levels in the country. Adding to this, an investment of £600 million to double number of stores, over 35,000 jobs are expected to be created by 2022.


Appeal
From the imitation of brands through packaging, and their simple layout consisting of nothing more than stacked boxes, fridges and freezers, Aldi is getting to the nation’s hearts and taste buds.

Additionally the accolades of LBP Supermarket of the Year 2014 and the winner of Which? Best Buy Awards, show how the appeal for the brand is growing.

Social Media Success: Avid customers share their love of the brand online

Not only associated with students, more middle class families are saving their pennies at Aldi. Statistics has suggested that the social category for middle class families, AB, had increased to 19% from 13% in 2012.

Peter Stubbs, 57 and his wife Lorrie Stubbs, 55, from Wigan made the switch earlier this year. They have three adult children who they don’t live with anymore, so were catering to suit themselves.

Lorie Stubbs, 55, said: “We switched because we heard it was a lot cheaper than Asda. We like it because their products are as good as major brands but less expensive.”
Back to Basics: Aldi’s simple store layout (Picture by Katie Parker)

Competitors
The soaring effect has made an impression to the food market, and competitors are feeling the heat. With price comparisons having being introduced by Asda, Morrisons has recently reacted to the budget stores advances in October of this year. “Match and More” is the first loyalty card scheme introduced to match the new European grocers’.

+-----------+-------+
| Brand | Price |
+-----------+-------+
| Aldi | 55p |
+-----------+-------+
| Morrisons | 59p |
+-----------+-------+
| Asda | 75p |
+-----------+-------+
| Tesco | 75p |
+-----------+-------+

Table above showing the comparisons for a loaf of brand own white bread. It shows how Aldi came out on top with the lowest price. (All prices correct at time of publishing).

The question arose to see if local independent businesses have seen the impact of the cheapest supermarkets that Britain have seen due to having everything under one roof, at the lowest of prices.

Louise Whiston, 39, a Sales Assistant as Thompsons Fruit and Veg, Preston, said: “Over the past six months trade has remained pretty much the same. This is because the shop is more market based and we get the same customers every week.”

It suggests a victorious situation for the British economy, with local and international businesses doing well in the food industry.


Times and trends have seen this German mastermind of a supermarket give the nation the best of both worlds; quality products and more pennies in our purses, and will continue to grow until Aldi meets their match and the nation’s taste buds.


Aldi Invasion

  • Albrecht Discount shortened to Aldi, was founded by Anna Albrecht in Essen, Germany, 1914. It was then taken over by her two sons Karl and Theo Albrecht.
  • The brand expanded to four locations, and in 1954 they opened their first self-service store which was also a first for the country.
  • Named Albrecht discount, the chain officially changed its name to ‘ALDI’ in 1962 and by 1967 the brand had over 200 stores in the south of Germany.
  • It was only recently in 1990 when Aldi moved ashore onto British soil with the first store opening in Birmingham. Nonetheless due to the nation’s love of bigger and better supermarkets at the time of the first chain opening, Aldi only gained recognition at the time of the recession dip when people shifted the bigger is better trend and opted for smaller stores.
  • Factors that helped this was the television advertising that was first introduced in 2005. The slogan: like brands, only cheaper, has become synonymous with Aldi and is communicated through their packaging and ingredients.
  • Word of mouth and customers comparing prices has led to a national domination of Aldi becoming the European supermarket giant.

By Katie Parker

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