Discounters and Other Innovators are Turning the Global Supermarket Industry on its Head
Traditional supermarkets on both sides of the Atlantic are losing market share, thanks to a rapidly advancing horde of competitors seeking to outdo them on price, convenience and quality, experts say. “Whereas once consumers bought all their groceries at one location, this is no longer the case. Consumers are now splitting their grocery shopping across multiple channels – as many as five,” wrote JLL analysts in the firm’s Retail Shop Topic report published last September. “By 2018, traditional supermarkets’ share of grocery dollars [in the U.S.] will have shrunk 300 basis points to 37.2 percent.”
Rivals of all types and sizes surround these chains. The list of competitors includes massive wholesale clubs and supercenters; fresh grocers focused on perishables and ethnic foods; a new breed of small, format stores in closer proximity to shoppers’ homes and geared toward faster, easier shopping; and thousands of food, focused dollar stores, drugstores and convenience stores. Meanwhile, online sales are gaining momentum, as the likes of Amazon.com’ s Prime Pantry, FreshDirect, Google Express, Instacart and Pea pod roll out grocery delivery services in major markets.
In the U.K. the highly efficient German grocers Aldi and Lidl are wooing droves of customers from mainline rivals […]