This month’s analysis from Kantar Worldpanel is a short but telling illustration of the shift of shoppers towards Aldi – and why produce has had a significant part to play in that
It is no secret of course that Aldi has enjoyed an astronomic rise in performance in the UK in the last five years. But the interesting thing for the produce industry is that its performance in our department, an area of the store that Aldi was not renowned for previously, has been a major driver of this rise.
Kantar Worldpanel’s Ed Garner recently said that both Aldi (+27% on the average shopping basket in the 12 months to end of 2014) and Lidl (+44% in the same period) significantly over-trade in the percentage of fruit, veg and salads in their overall sales. “These are go-to shops for produce,” said Garner at the time, and focusing on Lidl, he added. “The discounters are not just growing on the back of biscuits, tins and toiletries. If you’re a Lidl shopper, that’s where you buy your fruit and veg, not somewhere else.”
This presentation puts this into context. Slide 4 illustrates just how stark the produce growth of both Aldi and Lidl is compared with the big 4 supermarket chains over a prolonged four-year period. The graph shows the accumulated 12-week performance on wholehead produce, as measured by the researcher, which puts it way ahead of every other chain. Slide 6 and 7 show why this has happened – more than a quarter of shopping trips to Aldi now see shoppers putting five or more produce items in their ever-enlarging baskets, a huge increase from 2011, and that has driven a rise of almost 60% in spend per trip on produce over the period.
The big 4 still outstrips Aldi on spend per trip on produce at this point (March 2015 figure), but the graph shows just how close the gap has become – a remarkable shift in just four years.
Chris Cowan, consumer insight director at Kantar Worldpanel, says: “Aldi’s strength – and growing trip spend – has been that shoppers still shop at the major multiples (they’ve not flocked away from them) but people have, over the last five years, been adding more produce to their repertoire when shopping with the discounters. Aldi has seen strong growth in the numbers of people now doing their main shops with them, rather than top ups or specific trips.”
Cowan told us last month that Aldi is not necessarily stealing shoppers from its rivals, but it is taking hard cash out off their bottom lines (Tesco alone saw Aldi and Lidl wipe around £320m off its till roll last year). “They’re winning from the big 4 in particular. Also, it’s got to be remembered, Aldi’s store formats are now more leant toward a larger shop, which will naturally drive up this figure, says Cowan.”
Putting this growth into some context though, Kantar’s figures also show that still only around 20% of Aldi’s customers do their ‘main shop’ with the German-owned chain, while more than 60% of Tesco’s customers would say the same. Around 90% of the UK population will shop in Tesco this year, and more than 40% have shopped in a Tesco Express in the last three months of 2014.
When it was revealed earlier this month that Aldi had overtaken Waitrose for the first time in the share table, this article sparked plenty of reaction, although Cowan laughs it off as “a bit of a spoof”. He picks out The Co-operative, if any of the major chains is even close to being an endangered species.
“Co-op is struggling at a top line level too – although they have the high street real estate, they’re caught out with their messaging. They have strong values (for example, Fairtrade) but the rest of grocery is pushing a value message at this time. They do rely upon distress purchases (top ups) too.”
View Kantar Worldpanel’s full presentation here
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