Rise of the German discounter

Aldi, founded in 1961 by the Albrecht brothers, operates over 10,000 stores in 20 different countries. The German retailer places value at the heart of what it does and offers a range of own-label products at super competitive prices. We’ve seen many shoppers switching from big-name supermarkets to Aldi to help bring down their household costs. This has resulted in a sales surge for the discounter with a huge £116 billion revenue in 2021 which is a 15.3% growth from the previous year. Overall Aldi’s UK sales have more than doubled since 2011.

Aldi splits up Top 4.

Over the past month, it has become apparent that Aldi has split up the Top 4, originally Tesco, Sainsbury’s, Asda and Morrisons. Aldi has overtaken Morrisons and cemented it in place in the Top 4 as its market share rocketed to 9.2% in the four weeks up to 7th August whilst Morrisons’ was 9%. We are yet to find out what Morrisons is set to do about the loss, however, information from Futter tells us that ‘a look at the latest market share numbers shows that you can’t overturn those kinds of numbers- any part that Morrisons played in the Big Four has now gone.’

Why are people choosing Aldi?

The cost-of-living crisis is having a big effect on today’s economy. 89% of adults in Great Britain reported an increase in their cost of living in August 2022. As many people are trying to keep their household costs down numerous shoppers are switching to discounters like Aldi over known retailers as their budgets are being put under pressure. This, therefore, increases Aldi’s sales and revenue, putting them above other recognized retailers.

Gen Z strike again.

Many people believe that TikTok has played a big role in the growth of Aldi’s customer base. Many ‘gym-fluencers’ have taken to TikTok to show Aldi’s high protein foods/ shakes and low-calorie foods. This has really helped to promote the business and help it be seen by potential customers. There are also other Tiktokers who have been showing their Aldi finds with hashtags including #aldifinds #aldideals #alditiktok.

Overall, it’s been a big year for Aldi, SEEING a huge increase in sales and revenue as well as reaching top 4 status. But will it stay this way? With the cost-of-living crisis getting worse we may see more discounters following in Aldi’s footsteps.

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