Lidl’s loyalty app has been credited by experts as a key reason for it outperforming Aldi in Christmas trading.
Customer data gathered through the Lidl Plus app is seen as having enabled the discounter to better land key festive ranges at the optimum time, while personalised offers in the scheme will have helped draw shoppers.
Lidl was the fastest growing grocer in the 12 weeks to Christmas Eve according to Kantar, with sales up 13.8% year on year. Second-placed Aldi grew sales by 9.9% in the same period.
Kantar data also suggests Lidl took shopper spend from every competitor in the 12 weeks – including £12.2m from Aldi.
Aldi’s own data has its sales growth in the four weeks to 24 December at 8%, while Lidl has claimed 12% growth in the same period.
The Lidl Plus app, which launched in 2020, rewards users with weekly ‘coupons’ which can be redeemed as discounts on specific products in store. To claim the discount, users must ‘activate’ the relevant coupon and then scan a QR code in the app at checkout, a process enabling Lidl to collect data on their purchases and personalise further coupons.
Other rewards include ‘spin the wheel’ prizes, such as a coupon worth £10, as well as partner offers such as discounts on cinema tickets, holiday bookings and family days out.
Lidl boasted in its Christmas trading update of a 255% year on year redemption uplift, after it brought back an Advent calendar-style promotion offering a coupon a day during December. Each coupon had to be used on the day it was received.
The popularity of the app, now used by 38% of shoppers [Nielsen Homescan November 2023], meant Lidl had much better insight into what customers wanted and when at Christmas, said Marc Houppermans, executive partner at Düsseldorf-based Discount Retail Consulting, which helps discounters launch and scale across the world.
“More and more shoppers are using it – about 70% of Lidl customers have the app,” said Houppermans, who is also a former Aldi Netherlands board member.
“And Lidl knows much better how to work with it now, so it’s becoming more personal, especially for Christmas, and they can create much more customer loyalty than Aldi can because Aldi does not have this tool.
“This is a way Lidl can really differentiate itself from Aldi and Christmas showed it benefiting them.”
Read more: Festive sales: the winners and losers of Christmas 2023
William Snollaerts, also a DRC executive partner and former Aldi Netherlands board member, said Lidl’s bigger range – about 2,400 products to Aldi’s 1,800 – already put it an advantage at Christmas, when customers wanted a greater choice. The Lidl Plus app was now also giving it greater customer insight as it added lines for the festive period, he said.
Snollaerts said it was “one of the main ways for them to catch up with Aldi”.
Ronny Gottschlich, who was Lidl’s UK CEO from 2010 to 2016, also said the loyalty app had helped Lidl “choose when to land products” over the festive period.
“They’ve done a better Christmas this year,” he said.
“They are tailoring offers a lot more when using the Lidl Plus app and this is something you don’t have at Aldi,” he added.
The success of the loyalty app is seen as linked to Lidl GB’s decision to create a chief customer officer role on its board, as revealed by The Grocer last week.
“They may see the benefits and want to become closer to the customer, so they make it a board function,” said Houppermans.
“It could be a temporary development to see how it works,” he added.
Houppermans said Aldi was now considering launching its own loyalty app, in a project led by its parent Aldi Süd in Germany.
“They are thinking about it,” he said. “It’s an international development because you cannot do that as one country. Lidl also did it in all European countries.
“They already have project teams from all countries on it, so it could be that next year they come up with something.”
An Aldi Süd spokesperson said: “Whilst we are constantly evaluating new opportunities for the Aldi South Group, there are no current plans to introduce a loyalty app.”
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