ALDI – Love Or Loathe It, But Ignore It At Your Peril
In this opinion piece, Now Comms’ shopping expert, Kevin Moore, argues that ALDI’s rise in Australia is much like Dr Suess’s “green eggs and ham” – you may not initially warm to it but it’s going to win you over in the end…
ALDI is growing. Everywhere it trades in the world, it’s growing. So why is ALDI growing so fast? Why is this small range, discount grocer apparently a threat to the mighty Coles and Woolworths in Australia? In fact why has ALDI, and its evil discount twin LIDL in the UK grown to almost 10% share of total UK grocery sector? Why does ALDI and its upmarket sibling Trader Joe’s grow so fast in the USA? And what does it mean to an Australian communications industry that has a huge client base not only in all the parts of Coles and Woolworths, grocery, liquor and convenience arms, but also in the CPG supplier base of brands that sells their products through these two dominant grocery, convenience and liquor retailers.
As a very young kid my parents read me stories by Dr. Seuss. The calmingly monotonous ‘Sleep Book’ did a great job of getting me to sleep (and still does if you have young kids in your life) and ‘the Cat in The Hat’ entertained me, and let me know that I could be pretty bad and still manage to get things back on track. But ‘Green Eggs and Ham’ taught me a lesson at a very early age; it taught me that you need to try new stuff, or you will be missing out.
ALDI, to many shoppers is green eggs and ham. In the book ‘Sam I am’ tries to get the narrator and star of the story (you and I) to try green eggs and ham. Sam I am reckons they taste great, even if they are an unappealing green colour. But the narrator (you and I) doesn’t believe Sam won’t try them. In fact we repeatedly and clearly say, “I do not like green eggs and ham.” But how can we know that? We haven’t even tried them.
Well less well-off people try green eggs and ham. They understand the relationship between cost and value far better than wealthy people. They were the first to buy a Honda motorcycle, a Toyota car, a Dell computer and an Android phone. With the rising cost of living, people with less money than their richer counterparts have to think more carefully about where they choose to allocate their money.
In the words of Scott Galloway – the fast talking and engaging professor at NYU-Stern Professor and star of the ‘Four Horsemen’ video on YouTube – “wealthy people all look, smell and dress the same,” (See link here:http://tinyurl.com/nkoskj8), and I would add, shop the same. They won’t allow cheap new things into their lives. I think it’s the wealthy town of Marlow in England that petitioned against the opening of an ALDI store as ALDI is ‘too cheap’ and ‘may attract the wrong kind of shoppers to the suburb’.
So what can we learn about ALDI to better understand how we can work with them, their suppliers, and understand what is important to Coles, Woolies and the Consumer Packaged Goods Sector in this new growing discount economy?
Well, ALDI has a scarily low cost base, very narrow selection, even fewer international brands, great prices, poor service, some of the least engaged store staff in Australia, long lines and gaps on shelf. It was an early adopter of SALMAT’s Lasoo digital and mobile catalogues, and is very active in social media. In the US it adopted Electronic Shelf Labels not to lower its already low cost, but to free up store staff time to improve service via better engagement between staff and shoppers. In Trader Joe’s it also changed uniforms from drab blue to funky pastel Hawaiian shirts with lots of fresh product tastings in store. In Australia the low cost retailer is now in ‘flagship’ very high cost locations with attractive store designs like Chadstone Mall in Melbourne. ALDI branded cheese, wine, champagne and liquor win awards in blind tasting around the world. The product is cheap but very good. More and more CPG players are supplying ALDI with specials or manufacturing ALDIs own brands. It’s nimble and flexible when it wants to be.
Over at Coles and Woolies at CXO level you can be sure that Coles and Woolworths are taking a serious interest in big data from Quantium into the Every Day Rewards and data mining from the dominant Coles and wider retailer supported Flybuys Program. There is now a huge and renewed interest in the power, scale and reach of mobile social media from Facebook, Twitter, Instagram and YouTube, not as a reactive issue resolution tool, but the core proactive awareness and engagement platform across the businesses. Google’s data and reach is also being harnessed as Coles and Woolies seek to regain ground against ALDI. And they are funding all of these investments in data and social media via diverting funding from mainstream media. Suppliers are having to lower their shelf prices to help the two grocers compete with ALDI and, insult to injury, compete with the two grocers growing retail own brand portfolio. This is lowering the overall money the CPG industry has to invest in their brands, and where they are investing it.
So why would a 28-year-old male on $100,000 salary, wearing an MJ Bale suit he bought from Myer, walk into a ALDI store after work for cheap food, on his way to drop $100 a head on tapas and good wine two hours later? Same with a 30-something mum in an ML Benz whose hubby and her spend $50,000 net a year on private school fees? Why does a struggling single mum or retiree walk into a full service Coles or Safeway store to buy expensive organic yoghurt or fair trade coffee? If you don’t know the answers you need to walk stores, watch, listen and shop. Learn that the shopper isn’t a loyal consumer of one brand. Nor the loyal customer of one retailer, but the promiscuous shopper. We shift our behaviour based upon our shopping environment. What we see, hear, touch, taste and smell. What’s offered to us right now, just before, during and just after our shop. Data, technology and mobility are just the enablers.
I walk with brand owners, CPG CEOs, business owners, creative directors, agency MDs and marketers through stores a lot. I have to drag them into ALDI stores. They’re worried some young mum with a snot nosed kid will stain their MK handbag or G-star Raw jeans.
I bring a plain plastic shopping bag for them so they don’t have to buy and carry out an ALDI bag. However, once they start to shop the stores they understand why more and more nifty shoppers are going to ALDI. They begin to understand what they need to do to harness their brands for ALDI shoppers and differentiate their brand for Coles and Woolies shoppers. They start to think like a shopper and align with each retailer to offer shoppers the things each shopper wants from that store any time they visit it.
What are the big ‘so whats’ for our advertising and communications industry? Well number 1 is this: you need to walk stores and understand the shopper. Number 2: you need to understand, love and play in data. And number 3: you need to understand, love and live in all things mobile and digital. Age is no excuse. If you are not a sub 26-year-old digital native, you need to be a digital immigrant. By your choice of job in the communications industry you chose to be here. Learn the language and practice your pronunciation.
Sam I am, like the Albrecht family who own ALDI, is patient and tenacious. Over the course of the story he stays with the narrator (you and I) wherever we go. On boats and trains in the pages of the book, but mobile and digitally in our connected world that Dr. Zeuss wouldn’t recognise. Eventually Sam wears us down and we begrudgingly try the green eggs with the ham. And guess what? It appears that Sam was right all along. They do taste great, even if they are an unappealing green colour.
“That Sam I am, that Sam I am I do so like that Sam I am. I do so like green eggs and ham.”
Visit stores. People shop there.
Latest News
The Mars Agency Announces Latest Findings Of Retail Media Report Card
The Mars Agency has developed a scorecard that assesses the capabilities of leading platforms across key criteria required to optimally plan, execute, and measure effective retail media programs. The scorecard aims To help brands efficiently evaluate their spending options across retail media networks in Australia (and New Zealand). With spending on retail media advertising in […]
‘It’s The Lesser Of Two Evils’ – NRL Eyes US Betting Market As Aussie Regulators Circle
US betting firms will be delighted by the circa 50,000 Americans who could soon watch the NRL on their favourite app.
A-League In Deep Discussions With New Partner To Keep Games On TV After Production Company Enters Administration
The A-League's insatiable appetite for scoring own goals continues.
TV Ratings (27/03/2024): Jungle Members At War Over Concealed Lipstick
A heated argument between two jungle members did the numbers for Ten last night, with I’m A Celeb obtaining a total national reach of 1,282,000. Fans were delighted as Candice Warner and influencer Skye Wheatley got into it over a stick of lipstick, leading Warner to dub the Instagram star “selfish.” Wheatley, best known for […]
Is The Australian Music Industry In Trouble? Inquiry Launched Following Splendour Cancellation
Earlier this week, an inquiry was launched into the challenges and opportunities currently facing the Australian live music industry in the wake of multiple festival cancellations. On 25 March 2024, the Minister for the Arts, the Hon. Tony Burke MP, asked the Committee on Communications and the Arts to inquire into and report on the […]
Liana Dubois, Leandro Perez, Aimee Buchanan & More Gather For Inaugural Compadres Leadership Event
Didn't get the invite? Perhaps you're not as important as you thought.
Cathay Captures The Unforgettable Thrill Of Cathay/HSBC Hong Kong Rugby Sevens, Via Publicis
Nobody does rugby like Hong Kong, apparently. Certainly nobody does it as badly as Australia.
Cocogun Nabs Christine Watts, Kirsty Reynolds & Shev Tan Bolstering Management & Creative Teams
Cocogun bolsters its team with new hires. Committed to purchasing a bigger sofa, too.
The Media Store’s Jacquie Alley & Sam Cousins Take The Plunge With Pro-Bono Work For Cure Cancer
B&T chats with The Media Store bosses about their great pro-bono work and sponsored swim.
Hawke’s Brewing Co. Taps Rocket Comms For PR Agency Following Competitive Pitch
We're expecting Rocket Comms productivity to crash in spectacular fashion following this win.
Spotlight On Sponsors: Patties Serves Up A Taste Of Home For Olympians & South Sydney Rabbitohs Recommit To Gambling Reform
While the Rabbitohs commits to gambling reform, B&T reckons the team should commit to a decent auto sponsor.
Google: “Inevitable” That Bad Actors Will Abuse Ads Platform As Advertiser Account Suspensions Double
Google maintains it's simply impossible for it to entirely stop bad people placing & paying for ads using its service.
Quantcast Expands APAC Sales Team With Appointment Of News Corp Account Manager
No pressure at all when you are appointed as a client success manager.
Publicis Sapient Tests Microsoft-Powered Gen AI Search Tool With Homes & Villas By Marriott Bonvoy
Given Gen AI's record for mangling stuff, B&T cannot see the problem with letting it decide your next holiday digs.
Volkswagen & DDB Group’s “Roo Badge” To Reduce Kangaroo Related Road Collisions
Watch out for RooBadge as Cannes Lions' most debated campaign this year.
Twilio Launches Unified Profiles & Agent Copilot Features To Boost Productivity & Engagement
Agent Copilot sounds like James Bond's less interesting cousin.
Reebok & Honda Among New Clients For onetwo agency
OneTwo finally lives up to its name with this double billing.
Ogilvy Report: Throw Out The Social Strategy Rule Book, The Rules Of The Past No Longer Apply
B&T was puzzled that all 'influencers' aren't, effectively, 'virtual', but here we are.
WhiteGREY & AKQA Merge In Australia, Lee Simpson Departs
Fortunately, the combined agencies aren't opting for a trite portmanteau for the new name.
Splendour In The Grass 2024 Music Festival Cancelled!
Music fans all over the country reportedly relieved they can pack away their rain coats and gumboots for another year.
TV Ratings (26/03/2024): “Fairy Bread, F***ing Disgusting”: Gordon Ramsay Slams Aussie Food In Food Stars Launch
Ramsay not one for mincing his words, even when it comes to minced meat pies.
Paramount+ International Boss Doubles Down On Aussie Content, Says Ad-Tier will Grow Audiences And Revenue
Good news as Paramount will not be binning I’m A Celebrity for re-runs of Frasier.
Brent Smart: Telstra Pushing For 50-50 Brand-Performance Split But Warns Numbers ‘Won’t Look Great’ Initially
The old brand vs performance debate continues. But here, Brent is firmly sitting on the fence.
Crowded House, Tones And I & Dom Dolla Win Big At The Shure Rolling Stone Music Awards
B&T staffer reports back with humdinger of a hangover & feeling seriously uncool after mixing with music types.
Opinion: Dyslexia “A Hidden Gem” For Brands & Agencies
Dyslexics offer underappreciated benefits in the corporate field, according to this op-ed.
David Jones Taps Criteo To Power Online Retail Media Arm
Want to see ads for things you probably can't afford? David Jones has got you covered with new retail media play.
oOh!media Sets Up Team To Target Business Audiences Across Airports & Offices
oOh! wants brands to harass you every minute of your next business trip.
QMS Launches Australian First DOOH & TV Partnership With Samba TV
Samba TV, of course, is not a channel dedicated to dancing. Much to our dismany.
Slew Of New Hires At Amplify
Four new faces join the Amplify offices. Team say desk scarcity becoming "acute".
Adobe Announces Content Authenticity Initiative Expansions To Counter Deep Fakes
Try as they might to enlighten them, we suspect Trump supporters will continue to watch and believe Fox News.
The PR Group Appoints TechCrunch Senior Reporter Catherine Shu As Director Of Content & Media
Catherine Shu makes the bold leap from journalism to PR. Says inevitable pay bump was "unrelated".
HERO Nabs Ebony Santin From AMPR
Rumours Santin cleared out the stationery cupboard before departing are as yet unconfirmed.
Karena Noble Checks Out Of EVT Hotels & Resorts To Launch Comms Consultancy
Noble still managed to squeezed in a continental breakfast before departing.
Canva Acquires Design Platform Affinity To Bring Professional Design Tools To Every Organisation
Canva & Adobe face off continues. We're not picking sides but keenly aware that Canva's office is next door to ours.
“Lean On Our Team To Help You Find An Audience”: Why Understanding Audience Engagement Is Essential In Journalism
Engaging the audience is critical to journos, apparently. We'd thought self-loathing & alcoholism were key.
Adobe Summit: Major Gen AI Developments, Data Concessions & Partnerships
What happens in Vegas stays there. Unless it's the Adobe Summit and then you get to read about in B&T.