Aldi’s weak online proposition to blame for a disappointing Christmas, says GlobalData

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Following today’s release of Aldi’s figures for Christmas Trading FY2021; Kunaal Shah, Associate Retail Analyst at GlobalData, a leading data and analytics company, offers his view: “Aldi’s December sales inched up on a strong 2020 but considering its aggressive store opening program, its Christmas performance was disappointing and like-for-like growth will be in negative territory. The discounter’s sales increased 8.1% on a two-year basis but we anticipate this to be roughly in line with the grocery market and unlike recent years, Aldi has not shifted market share away from the big four. 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.

“Aldi’s low-price, store-first proposition means offering home delivery is not a priority at the moment, however it should explore this offer to truly compete with the top four. 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.

“The retailer has attributed some of its success to its Christmas advert – based around the hugely popular Kevin the Carrot – with its Specially Selected range seeing record sales. By continuing to offer a high quality, affordable, wide range of products, Aldi’s range will appeal to a wider consumer base as UK shoppers face rising living costs in 2022. 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.”