Lidl, (pronounced leedle), the giant German food retailer plans to open 100 stores on the East Coast over the next 12 months. Lidl is Europe’s largest grocery discount chain with revenues of $62 billion in 2014. Its stores in Europe are similar to Aldi’s in the U.S.

But speculation is that Lidl’s U.S. stores will more closely resemble a Trader Joe’s than an Aldi. Lidl’s U.S. stores will be larger than Trader Joe’s, but likely appealing to similar customer base by offering a large selection of unique private label products such as gourmet, natural/organic, and ethnic foods at prices lower than other retailers.

According to Lidl:

“After three years of research, we discovered that U.S. consumers don’t like discount groceries . . . (We will offer a) totally unique shopping experience, unlike anything else in the market.”

The strategy has some merit considering:
– Trader Joe’s customer base tends to be higher income and more educated – a group that leans to be more open to trying new brands.
– TJ’s more vulnerable right now? For the first time in four years, Trader Joe’s is not at the top of Market Force’s favorite grocer list. It fell to third behind Wegmans and Publix.
– Aldi’s has a large and established foothold in the U.S market and it would be difficult to undercut their rock bottom prices.

Again this is all speculation, but Lidl appears to be pursuing an interesting niche – definitely something for category managers to watch. Stay tuned.

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