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Retail

Limited Online Presence Impacted Aldi UK Over Christmas: GlobalData

By Steve Wynne-Jones
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Limited Online Presence Impacted Aldi UK Over Christmas: GlobalData

Aldi UK's performance over Christmas was impacted negatively by the discounter's limited online offering, GlobalData has said.

Earlier this week, Aldi reported a 0.4% increase in sales in December compared to the previous year, with sales up 8.1% on the corresponding period two months ago.

However, as Kunaal Shah, associate retail analyst at GlobalData, explains, Aldi’s weak online proposition has meant that the retailer largely underperformed over the Christmas period, particularly given its aggressive store opening programme.

"Aldi has not shifted market share away from the Big Four," Shah explained. "Growth achieved by the discounter in 2020 was predominantly driven by higher consumer grocery spend during the national lockdowns helped by the closure of the hospitality sector but Aldi’s poor online proposition has held it back in 2021 and will hinder the retailer’s future growth plans as consumers increasingly buy online."

Competing With The Big Four

While online is not a priority for Aldi at present, Shah believes it needs to explore this channel further if it wants to compete with the UK's largest supermarkets.

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"[Currently], consumers can order online via click and collect from around 200 stores, or through Deliveroo from over 130 stores (of its total 930 branches) but Aldi must consider rolling these options out to reach more consumers across the country, particularly as its competitors begin to expand rapid-delivery initiatives," he said.

Increased Living Costs

Aldi noted the success of its Specially Selected range over the Christmas period, and the fact that shoppers are likely to face increased living costs in 2022 means that its competitively-priced range will continue to appeal to a large proportion of shoppers, Shah added.

"However, Tesco and Sainsbury’s aggressive price match offer have allowed them to compete with Aldi on hundreds of products, and Aldi must look to continue to refresh its range if it is to continue growing its market share in the UK," he said.

Aldi is currently Britain's fifth largest supermarket group with a 7.7% market share, according to Kantar data.

© 2022 European Supermarket Magazine. Article by Stephen Wynne-Jones. For more Retail news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.

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