The next big thing in supermarkets

I have blogged previously about the Coles/Woolworths responses to the development at Stockland Baulkham Hills. At the time my family started shopping at Aldi. We then realised that we’re shaving about $100 off the weekly food shopping bills – which translates into a very nice free holiday at the end of the year – and we haven’t been back.

I must admit I was initially slightly embarrassed, which was why I never seriously considered shopping at Aldi. (Someone you know might just think you are poor, right?) I started observing the customers in Aldi a bit more carefully – and thought I noticed some very a-typical Aldi shoppers.

My initial thoughts were that there must be an emerging secondary market of relatively affluent people who:

-          Appreciate the quick shop that results from smaller stores and fewer choices

-          Are smart enough to know that the biscuits come from Arnotts anyway

-          Couldn’t give a hoot as to what other people thought

But then I thought I was post-rationalising my decisions and maybe I am just a tight ar**.

I subsequently had a discussion with my MBA class at MGSM, and one student who hails from Germany confirmed that there has definitely been a big shift in perception about Aldi and that the Aldi bag wasn’t a stigma any more.

Then I read an article published in the Cincinnati Enquirer yesterday. (Isn’t the internet great?) Dan Gavin, a divisional vice president for the limited assortment grocery chain, told The Cincinnati Enquirer that they were previously ‘in class B real estate market,’ but in the past year have moved our real estate to Class A sites. He also says that ‘all types of incomes like to save money.’

That confirms it for me. Aldi is going to evolve as major threat for Woolworths (and Coles) in the next decade. They will increasingly appeal to time-poor, but marketing savvy consumers and as the secondary market grows, they will start hurting the major supermarkets a lot more.