THE RISE OF LIDL ... and the fall of leading supermarkets.
After reading a recent article from marketingweek I was inspired to write my first blog post as a professional marketer.
Lidl was a brand that had never really made a big impact or made me stop and think. I had certainly not ever thought about going there to do a weekly shop or even to just stock up on the usual things like milk and bread. However this was all about to change...
On a very very boring day I decided to go into my local Lidl for a little look around to pass some time. Not a lot had changed since my last visit, the floors were the same, the stock on the shelves seemed the same, the lack of people seemed the same. But there was one thing that caught my attention and that was the smell of baking bread. Just as you entered Lidl there was a station where an employee was taking bread in and out of a big cooker. This made me think about the some of the things I had learnt from my marketing degree about creating an experience for a customer and exciting all their senses. Well as i'm sure you all know the smell of cooking bread is just delicious and this has been used by leading supermarkets for a long time. It not only sends off positive messages about the store and the quality of the food (home made) it also makes you more hungry! Obviously a very handy thing for customers to be when they are buying food. I still left Lidl empty handed but I was much more impressed.
Lidl then started their new campaign 'Surprises'. The first I had seen of it was in this TV ad and it certainly did surprise me! I did not expect those reactions from someone who was eating something from Lidl - clearly the ad worked! I was also impressed by their sudden engagement with social media. They promoted their Facebook and Twitter pages with #LidlSurprises which is simple but very effective. They carried this campaign through to their Christmas ad showing surprised families eating a full Christmas dinner from Lidl. A very good idea as people start considering where to shop.
Recently a new pop-up restaurant called Deluxe opened in London which seems to have a very similar logo to Lidls new premium range, also called Deluxe, and the restaurant is also serving reindeer carpaccio, a new addition to the Deluxe range this year. Lidl has not commented on this but I believe that just adds to the mystery and surprise.
It has been widely reported that the likes of Tesco, Sainsbury's, Asda and Morrisons have falling profits and are losing market share fast. Tesco’s half-year profits have dropped from more than £1bn to just over £100m. Sainsbury’s lost nearly £300m over the same period. The cause of this, in my opinion, doesn't need to be shown in statistics or massive amounts of data, they simply have forgotten about the customer. They have enjoyed the top spot for such a long time that they were focusing solely on price and revenues and not enough on what the customer was really looking for.
The German retailers Aldi and Lidl are growing at a rapid rate with 12-week revenues up by 26% and 17% respectively, according to Kantar Worldpanel, and I am sure this is going to continue to grow.
I believe customers are now looking for the something different, something that none of the giant supermarkets are providing and are therefore going to the smaller supermarkets like Lidl who are capturing their attention. Lidl is certainly doing all the right things to change its brand image and I think its a very interesting situation to watch unfold.
Will customers be giving up their loyalties to the 'Big 4' this Christmas or will Lidl and Aldi have to work just a bit harder to move customers permanently?
Whenever it will be I expect to see Lidl and Aldi rising to the top.