"Once in a lifetime" opportunity for discounters

Friday, 28 November 2008

A "once in a lifetime opportunity" is afforded to discount retailers because shoppers are changing their shopping habits during the credit crunch, according to a new report.

Verdict Research said Aldi and Lidl are set to become a much more "significant force" in the UK as consumers cut back on non-essential spend.

Discounters should "aggressively drive expansion" and build on the success they have already seen during the recession, it argued.

The results come after exclusive research for TalkingRetail.com by Empathy found consumers are switching supermarkets because of the credit crunch.

European retail analyst at Verdict Research Daniel Lucht said the discounters need to innovate now more than ever before.

He said: "As quality perceptions improve, discounters have the chance to convert middle class shoppers to loyal customers and range reviews will play a key role.

"The obvious range addition is organics with consumers across the European Union perceiving it as higher quality than standard produce.

"While the introduction of organic private label ranges has progressed massively in other markets already, with Aldi being the biggest organic grocer in Germany, the UK lags on this aspect."

Report co-author Simon Chinn said Aldi and Lidl can both continue growth by reviewing their ranges and opening up new offers.

Waitrose this week said it is benefitting from price cuts as the recession digs into people's finances.