January 03, 2022
By special arrangement, presented here for discussion is an excerpt from an existing article from Frozen and refrigerated buyer magazine.
“Today’s Aldi is not the Aldi I’ve known before,” notes Kathy Hayden, Senior Vice President/General Manager of Customer Success at Inmar Intelligence.
In addition to its sometimes shockingly low prices, “Aldi has continued to offer a variety of products in every category that cater to the different lifestyle needs of shoppers, including natural, organic, vegan and gluten-free,” which consumers are not accustomed to finding in a discount store. Limited assortment.
On one recent visit, for example, we discovered everything from vegan pancakes and keto ice cream to organic almond milk and cauliflower crust pizza. Then there are the “gourmet” items, including European meats and cheeses, frozen entrees and sumptuous desserts, as well as a wide selection of seasonal favourites.
Many of these “get them while they last” are included in the chain’s Aldi Finds program, which creates the treasure hunt experience the retailer is known for. Far from impulsive buying, these “special purchases” support perpetual market testing.
“It’s a win-win situation because shoppers try new products and the retailer gets to know how the market will respond to those products without a significant investment,” notes Bill Bishop, chief architect at Brick Meets Click.
Between Aldi Finds and regular purchases, industry watchers say the chain’s width is “more than enough” for an entire store.
“Although the range is limited, it is much more comprehensive than other discount formats such as dollar stores — with a more extensive assortment of fresh and frozen produce,” says Neil Saunders, Managing Director of Retail at GlobalData.
“Plus, Aldi really prides itself on the quality of its own brand products in particular. Besides the low prices, it provides a very strong message about value for money.”
In the current climate, the focus on Aldi’s private label, weak cost structure and better-than-average pay are expected to help address the triple challenges of retail: supply chain disruptions, labor shortages and inflation. Any slowdown in the coming months should provide more opportunities to gain a share as consumers drop and discover Aldi’s prices more than ultra-low prices.
“Aldi should not be dismissed as a low-price, no-frills retailer because that is not the current situation,” said Mr. Saunders.
DISCUSSION QUESTIONS: Do you agree that Aldi in the US has evolved beyond price? What obvious and less obvious challenges does Aldi pose to competitors as it has evolved as a limited assortment grocer?
“Not only did they raise the level, but I think they also made it extremely high!”