It is impossible to understand the UK grocery market right now without recognising the impact of two German players on the sector.

Aldi & Lidl : It is impossible to understand the UK grocery market right now without recognising the impact of two German players on the sector.

Two decades ago Aldi and Lidl were, relatively, fringe players in the UK compared to the ‘Big Four’ supermarkets which then dominated sales. The discounter’s branches were cash-only stores with unfamiliar brands, aimed at dyed-in-the-wool bargain hunters. Now, these stores set the grocery agenda and bigger supermarket rivals often follow their lead.


The Retail Gazette: “Aldi market share tops 10% as discounters in demand”.


Aldi just secured double digit market share in the UK for the first time. That’s news in itself, and it comes on the back of a 25% jump in sales in the 12 weeks to mid-April, outpacing sales growth at its rivals. Discount supermarkets are now mainstream stores.

Those figures show just how established the discounter recipe of a tight product mix, no-frills store designs and consistent low prices has become in a market where price is the number one concern for many shoppers. Aldi UK chief executive Giles Hurley has spoken of plans to create a further 6,000 jobs this year as Aldi expands.

The impact of the expansion of Aldi and Lidl has been felt throughout the sector. Twenty years ago it would have been hard to imagine Tesco running an Aldi Price Match campaign, for example. The idea that the UK’s biggest retailer would highlight the name of a rival in its TV advertising and store displays would have been laughed at.


But things have changed and now that price match campaign is seen as a smart move by Tesco. It gives customers – who are well aware of the value on offer at Aldi – ‘permission’ to stay at Tesco when buying their essentials, instead of visiting two stores. Analysts say it has been a strong damage limitation strategy; The Grocer last year referred to it as a ‘marketing case study in years to come’.

Shoppers are fickle, shifting between retailers for different products and missions, using loyalty discounts when it suits them. It is still common – some of us literally watch these things – to see families buying essentials from Aldi or Lidl before going to another store for their favourite brands.

Yet if the relationship between the retailers and their customers is complex, the ones between the supermarkets, the discounters and product suppliers is even more complicated. 


The Guardian: “Lidl wins high court case against Tesco over blue and yellow logo”.


Just last week, Lidl won a court case against Tesco. Tesco was found to have committed a ‘passing off’ offence by using a yellow circle device similar to Lidl’s logo to highlight its Clubcard offers. The judge in the case ruled that Tesco was seeking to enhance the value of its proposition by adopting a ‘getup’ that shoppers associated with Lidl’s low prices. Tesco plans to appeal against the ruling that it must change the look and feel of its Clubcard Prices logo.


The Sun: “22 of the best copycat Lidl and Aldi products – but can you spot the difference?”


We are used to supermarkets being accused of copying familiar brands with own-label versions (see above a story from The Sun in 2021 comparing products with their ‘copycats’ from Aldi and Lidl). Most of the supermarket chains have been accused of it at some point in the past. As consumers, we often turn a blind eye even if we think the copies are a bit close to the line – because we love a bargain.

But when the market leading supermarket is accused of copying another retailer – and a much smaller one at that – we take notice. 

If nothing else, the sight of Tesco and Lidl fighting their case in court illustrates how seriously the companies must take each other. 

How might things have changed in another 20 years?