Aldi & Lidl - more 'meaningful' than the big four?

The rise of the low-cost supermarket chains in the UK has been phenomenal. Brands such as Aldi and Lidl burst onto the UK retail scene with confidence and consumers have responded well to them, but why?

Both Aldi and Lidl came in the Top 10 performing brands in our recent ‘Meaningful Brands Retail Report 2015’ – a study which measured retail brands on metrics such as their contribution to society, their benefit to the individual, and quality of product, including price and value. Whilst you might assume their success is solely due to competitive pricing, there is actually much more to the story.

Our report showed that whilst retailers in the UK are generally quite good at ensuring their product and service is up to scratch, there is a big opportunity for them to improve people’s lives at an individual level and contribute more to consumers’ personal wellbeing. This is what the most meaningful brands like Aldi and Lidl do well, and in doing so they achieve competitive advantage - including better trust, higher levels of loyalty and consumers being twice as likely to recommend that others buy from them.

With Aldi coming in at number four, and Lidl number seven, in the Meaningful Brands Retail Report 2015 – both above ASDA, Tesco and Morrisons – it is clear they are connecting with consumers on a more personal level, including making customers feel happier, making their life easier or giving them greater confidence.

Most businesses place great effort on communicating the benefits of their products and services, but less effort demonstrating how these products or services tangibly benefit people’s lives and the needs of society as a whole. It is stories like Lidl shopper Alan MacInnes who was allowed to take his groceries home with just an IOU to the store manager, having accidentally left his wallet 126 miles away, or Aldi stock assistant Christian Trousedale carrying a 95 year-old pensioner’s shopping home for him, that help boost these brands’ perception to customers as they appeal at a personal level and demonstrate a human touch.

Whilst price and product quality are always going to be important deciding factors for customers when choosing their supermarket, retailers need to recognise that what customers are also looking for is for a brand that inspires them, makes them happier and healthier, and generally improves their life. It’s a missed opportunity and one to which retailers must commit in order to increase customer loyalty and trust.

Jon Kershaw, Head of Strategy, Havas Media