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Why price is the key differentiator for Aldi

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Even as product quality, assortment, merchandising savvy, and store environments have improved, Aldi’s key differentiator remains low prices.

“Aldi stands for extreme value,” said Jim Hertel, senior vice president at Inmar Analytics in Winston-Salem, NC, noting that “value” takes into account more than just low prices, referring to the chain’s unique and incredibly strong value proposition.

Further, he notes, are “top-quality, private label products typically priced 35 to 40 percent below the national brands sold through traditional supermarkets.”

Although Aldi BB #:116756 does not appear among the top favorite grocery retailers in Dunnhumby’s 2019 Retailer Preference Index, it does rank #1 when it comes to price—ranked by consumers ahead of Market Basket, Winco, Food4Less, Costco, and Walmart.

“Aldi’s ability to consistently cultivate a strong value-for-money-spent image is a key strength,” said Brian Numainville, principal at Retail Feedback Group, whose own Retail Feedback Group U.S. Supermarket Experience Study for 2019, found the chain also scored well in store cleanliness, as well as both checkout speed and efficiency.

Aldi does score lower on staff availability, given the limited number of employees in each store, and on variety, due to its small footprint, Numainville said.

The latter, however, may change as the chain continues to expand both square footage and product lines.

Similar results were found in Market Force Information’s latest Composite Loyalty Index. Aldi ranked fourth overall—after Wegmans, Publix, and Trader Joe’s—but earned the top spot among retailers in terms of “value for money.” It also did well on checkout speed (ranking third) and cashier courtesy (ranking fourth).

This is an excerpt from the most recent Produce Blueprints quarterly journal. Click here to read the full version.