With the retail world buzzing about Amazon’s revelation that it will enter the brick-and-mortar grocery business, new research from Bain & Co. finds that Americans are more interested in deep discounts than in omnichannel offerings.
Both Aldi and Lidl, two German-owned chains that have been expanding rapidly in the U.S., are gaining share, attracting as many as 30% of shoppers. “Hard discounters are here to stay,” says Mikey Vu, a partner in Bain’s Chicago office and an author of the report. “People are very happy with this format.”
He says the news that Amazon is going into mainstream groceries isn’t all that surprising. “Grocers have been keeping an eye on Seattle for this for a long time. Grocery is one of the more ‘online-proof’ sectors. It’s still fundamentally a local marketing experience. And while people are more open to picking up online orders, delivering groceries is just insanely expensive.”
Bain’s research, done in partnership with ROIRocket, included more than 17,000 consumers. The study finds that while Aldi and Lidl are relatively new to the U.S., they’ve attracted many cross-shoppers “and built up a surprising customer advocacy in a short time,” he tells Marketing Daily.