Discounter Lidl is said to be ‘actively exploring’ a launch into the UK e-commerce market.
Last week, a number of trade publications reporting that the discounter is advertising for an e-commerce project manager and junior project manager for what it says are ‘exciting new e-commerce projects’ at the ‘start of a new chapter for Lidl’.
Nothing New
Online delivery is not something completely ‘new’ to Lidl. Last September, Lidl Ireland launched a one-hour delivery service in Dublin, teaming up with grocery courier Buymie, which isexpected to launch into the UK this year.
This ambitious move followed the launch of Aldi Local in March, which in turn was followed by Lidl shrinking its size requirements for new London store openings.
Blurred Lines
These moves alone indicate that the ‘blurring of the lines’ in grocery is continuing apace, meaning that a move by Lidl (or indeed Aldi) into the online space is not beyond the realms of possibility.
With this in mind, shopper research and insights firm HIM has examined six statistics about the UK e-commerce environment that is likely to explain Lidl’s online ambitions.
1. A third (32%) of shoppers did an online shop in the last week
HIM’s Omnichannel Barometer for May shows that 32% of shoppers used online retail over a seven-day period. In comparison, 26.5% of shoppers shop at Lidl. As HIM suggests, a move into online will therefore open up a wider pool of potential customers for Lidl.
2. A fifth (19%) of discounter shoppers also shopped online in the last week
With channel loyalty currently low in the UK food and grocery sector, many shoppers are turning to a variety of channels to complete their shop.
HIM research has found that 19% of discounter shoppers also used online, 45% shopped in a supermarket and 37% visited a convenience store in the past week. The research firm suggests that a move online and a potential move to smaller format retailing will enable Lidl to cover a variety of channels, leaving shoppers less need to shop around and choose other retailers.
3. More than half (52%) of online shoppers use it for their main shop
Of those that shop online, the majority (52%) do it for their main shop, which is a tantalising prospect for any retailer, and especially a discounter.
In contrast, the main mission at discounters is top up (32.3%), according to HIM, with just 27.5% of visitors conducting their main shop. An online presence would therefore give Lidl the opportunity to reverse this trend and attract bigger baskets and higher spenders.
4. Four-fifths (80%) of online grocery shoppers spend over £40 per shop
Online retail tends to experience higher shopping basket spend, with 80% of consumers using the channel spending over £40 per visit. In comparison, just 20% of discounter shoppers spend over £40 per trip.
5. More than two-fifths (42%) of online grocery shoppers choose a specific retailer for value for money
Value for money is the main reason shoppers choose a specific online grocery retailer, according to HIM. This is also the case for discounters, with 52% stating that value for money is the number one reason a consumer would choose a particular store. Should Lidl move online, it would be in a great position, therefore, to develop a win-win.
6. Some 39% of industry professionals expect online retail to outperform the overall grocery retail market
The recent HIM and MCA Top Of Mind Report 2019 found that that nearly two-fifths of industry professionals expect online grocery retail to outperform the total grocery retail market over the next year. Furthermore, two-thirds (67%) expect discounters to grow faster than the total market.
With this in mind, Lidl has the potential to build a presence in the two channels that the industry expects to ‘outperform the market’ in 2019 and beyond.
According to HIM, these statistics highlight a winning opportunity for Lidl to make a success of online retail, particularly in an era in which shopper promiscuity is rife.
‘There is no doubt that a move into online from Lidl will ruffle the feathers of its competitors, particularly with value being a key driver to choosing a specific retailer,’ the research firm said. Online and discounters are the two channels with the least overlap, so Lidl will be looking to attract a brand-new type of shopper, who has a bigger basket and greater spend.’
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
