Why Aldi change could be a big mistake: experts



Why Aldi change could be a big mistake: experts

For two decades Aldi has prided itself on being different to its main rivals but recent changes could be detrimental to their business model, experts say. Picture: NCA NewsWire/Paul JeffersSource:News Corp Australia

German supermarket chain Aldi is at risk of losing its point of difference due to new strategies, retail experts warn.

Almost every week since it launched in Australia in 2001, Aldi has offered enticing weekly specials — from dishwashers and TVs to handyman essentials and gardening implements, not to mention popular skiing and camping sales.

Why Aldi change could be a big mistake: experts

Buyers can now purchase specials online, which may be to Aldi’s detriment, experts say. Picture: SuppliedSource:News Limited

The sales create a fear of missing out (FOMO) among shoppers, with long queues forming before opening hours.

But, the move to sell specials online could be a strategy Aldi regrets because it put the supermarket in the same bargain category as Amazon and Catch, retail expert Gary Mortimer said.

“Aldi has driven that FOMO effect, and deliberately only offered limited quantities so shoppers had to line up to get it or miss out,” Professor Mortimer said.

Why Aldi change could be a big mistake: experts

Professor Gary Mortimer says Aldi may no longer be ‘different’ from its main rivals now it’s selling online and introducing self service check-outs.Source:Supplied

“It’s been a brilliant marketing strategy and that grew the success of being good and different.

“We saw the events of two weeks ago with the ski sale; it’s a massive event. It creates excitement and theatre and that’s what we love about Aldi.

“What experience is left for the shopper of the big ski sale or weekly special buys if anyone can get them anytime online?”

Aldi has been so successful, its opposition has imitated it.

Last week, Coles offered a pressure cooker for $79.99, an office chair for $59.99 and a computer monitor stand for $14.99.

“With Coles and Woolworths and Kmart, you can buy in store or online and when you compare them, there really is no point of difference. Similar product, brands and distribution channels,” Professor Mortimer said.

“But Aldi was different because the experience was in store, but not anymore. They’re becoming more of the same.”

Why Aldi change could be a big mistake: experts

Marketing and university lecturer Malcolm Auld says Aldi should limit online special sales to 24 hours to preserve its ‘different’ tag.Source:News Limited

If Aldi wanted to remain different but sell online, it needed to restrict access to its online weekly specials, marketing expert Malcolm Auld said.

He said selling online would broaden its revenue stream but it ran the risk of melding with Amazon, Kogan, eBay and Catch.

“They do own these wonderful sale days and whether it is FOMO or bloody good deals, who knows, but you know how costly it is to go skiing, so if you can get one of their specials online or in store, you are going to buy it,” Mr Auld said.

“You could argue that people looking for the cheapest product will shop between Kogan, Catch, Amazon and eBay and if Aldi is smart they would offer up a one day only online sale.”

However, selling specials online was not the only way Aldi was losing its point of difference to Coles and Woolworths, Professor Mortimer said.

Aldi is about to trial self-service check-outs, in another move that challenges its uniqueness.

“They had a gold coin for a trolley, no loyalty points, no self-service check-out and no online sales and that made them different but as you start to introduce things that everyone else is doing, you are kind of the same,” he said.

“Everyone can emulate low price. Coles and Woolworths’ private label products and Aldi’s private labels are essentially the same, but the shopping at Aldi is a different shopping experience.

Why Aldi change could be a big mistake: experts

Aldi says selling online has been a success and allows them to offer bulky products, such as mattresses and fridges.Source:Supplied

“The changes are a potential risk for Aldi, who may still be good with price but may no longer be perceived to be different.”

An Aldi Australia spokesman said its move online had been a “great success”.

“We are pleased to be able to provide our customers with an alternative way to shop (for) bulky products, including fridges, mattresses and tool chests, while also looking into expanding the offering to include high value and every day special buys,” the spokesman said.

“Positive customer feedback on our initial online offer is encouraging and reaffirming our plans to expand our offering over time.”

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