This article published December 2015. For latest news THIS MONTH'S ISSUE
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Aldi will try to keep its momentum going in 2016, with a multitude of projects both at the front and back end, writes Daniel Lucht of ResearchFarm.
From a position of strength the retailer is building out its competitive advantage. To an outsider it looks like the speed of innovation has never been more rapid at the discounter. As a result of measures implemented now, going forward, fast growth is virtually assured in 2016.
On the front end the discounter is refreshing its store estate. In Australia the most ambitious remodellings are under way under the code name Project Fresh. Back in the old world a new store design trialled in Munich is a radical departure for Aldi Sued. Learnings from across the globe will be shared for Aldi's store of the future formats.
Similarly, in the UK the convenience fascia in Kilburn, London, has seen an update. Aldi has rearranged cash desks, added more fresh ranges and updated the convenience offer and the layout to reflect shopper missions. Grab and go ranges are featured in the entrance, while food is situated at the back of the store (reflecting latest convenience store thinking). On top of breaking through the 10% market share barrier in the UK (with Lidl) Aldi has seen a strong start to the Christmas season. The retailer knows ad spend now will push sales now and have an effect after the Christmas season, when shoppers will have to tighten their belts after the splurge.
Also on the back end, Aldi continues its work with suppliers and sticks to tried and tested principles such as triple supply for single private label SKUs and grouping trips from suppliers into warehouses. This efficiency at the back end, often underestimated, is one major driver of its sharp pricing profile.
With rapid growth in Australia, the UK and the USA, the introduction of FMCG brands has become much more of a pressing issue. In Germany the roll out has taken on breath taking speed, with Aldi Nord now following suit.
And, as if this wasn't quite enough, the discounter is also preparing its expansion into Italy. With all these initiatives - as always risk assessed to death by Aldi before a roll out - growth for the discounter in 2016 could even be faster than in 2015.
All in our latest report: A corporate strategy update: from the move online to the convenience push. Recent store visits from Australia, the UK, Germany, France included. Click here for more!
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