After Lidl comes Aldi: the German discounts and their conquest of America

20 Sep 2017
While Walmart and Amazon continue to carry the torch for home deliveries (Walmart has just opened its one thousandth grocery pickup location on Amazon's home turf in Seattle), the European discount giant Aldi has also decided to throw its hat into the ring.

Aldi, which now has about 1,600 stores in the US, has announced a $3.4 billion investment plan aimed at increasing its number to 2500 by 2022. This would make Aldi the third biggest retailer in the US, behind Walmart and Kroger. In keeping with this idea, Aldi has recently signed an agreement for home delivery with Instacart. The service initially covered the cities of Los Angeles, Atlanta and Dallas, but has already extended to another 80 locations in the country.

Founded in 2012 in San Francisco by Indian Apoorva Mehta, in only 7 years Instacart has reached a coverage of 1200 US cities and is worth nearly $3.5 billion. There are 160 retailers using Instacart, including Ahold Delhaize, Albertsons, Petco, Target, and Costco. Ironically, the list also includes Whole Foods, under a five-year contract from 2016, who were recently acquired by Amazon.

The Instacart model, as simple as it is as effective, has inspired several replicas, including the Italian Supermercato24: a network of personal shoppers, who carry out the shopping on behalf of the shop's customers and deliver to their home within the hour, at a charge of between 6 and 10 dollars. The alternative option is Instacart Express, which provides free deliveries for all orders over $35 for $149 per year, and allows shopping in a variety of stores.

The German presence in American retail took an important step on 15th June, when Lidl formalised its target of opening 330 big supermarkets by 2020. According to 2017 chart of the top 250 retailers in the world by the National Retail Federation, Aldi is in eighth place with a turnover of over $82 billion, just behind Carrefour in seventh position. With $94 billion, Lidl surpasses its compatriot and rival, and is ranked fourth.