Dive Brief:
- Aldi has partnered with Nielsen to gain access to more shopper and advertising data, according to Retail Leader. The multi-year relationship includes shopper panel data, custom retail analytics and advertising effectiveness measurements.
- As Aldi grows, Rob Hill, Nielsen's executive vice president of U.S. retail services, said in a statement that the retailer needs access to additional information and the analytics company “looks forward to supporting Aldi’s growth and expansion initiatives within the U.S. market.”
- Aldi has nearly 1,700 stores in 35 states across the U.S. at present, but it is rapidly expanding. The retailer plans to have 2,500 U.S. stores in the next five years.
Dive Insight:
While many grocers already have these sorts of partnerships in place with data and insights providers like Nielsen or IRI, a hard discounter such as Aldi often does not. The teaming of Aldi and Nielsen reinforces the importance of business intelligence, consumer insights and data analytics in today’s competitive retail climate.
As many analysts have pointed out, more grocers are implementing a data-focused retailing model. By teaming with Nielsen, Aldi has its hands on increasing amounts of data and analytics capabilities to help support its future aggressive growth objectives and navigate the evolving grocery landscape.
Aldi is spending $3.4 billion to expand its store base from nearly 1,700 today to 2,500 stores across the U.S. by 2022. It also has budgeted $1.6 billion to upgrade and expand 1,300 stores by 2020. Remodeled stores, more locations, low prices and now first-class data will make it an even more formidable competitor going forward.
By gaining access to Nielsen's data, Aldi increases its competitive advantage versus the rest of the playing field. This now provides even more incentive for grocers to continue investing in pricing, digital, e-commerce and other user experiences that will help give them a leg up in the quickly evolving retail grocery landscape as well. Given the strong price positioning of Aldi — as well as price wars among grocers like Walmart, Kroger, and others — it’s clear that price is no longer a competitive differentiator.
Consequently, grocers must increasingly frame their value proposition to emphasize non-price factors such as freshness, quality, customer service and the shopping experience. They should find ways to deepen emotional connections with shoppers. With Aldi all about owning price, convenience and limited assortment, it gives large-format grocers all the more reason to create experiences that engage consumers and encourage them to browse around, shop longer and hopefully spend more.