Lidl Comes to America: A Preview

Lidl retail storefront

Lidl, Europe’s largest discount grocery chain, announced earlier this year it would open its first 20 U.S. stores this summer. The first Lidl stores, primarily in Virginia and the Carolinas, are now set to open their doors on June 15.

The Germany-based grocer already has more than 10,000 stores in 27 countries. Back in 2014, Reuters reported that Lidl planned to open 100 stores in the U.S. as early as 2015. Though the move to the U.S. has been delayed, the official launch date is almost here and their plans for stores on U.S. soil are proving ambitious.

Now that Lidl’s entry into the U.S. market is imminent, what should you know about Lidl? What should you expect? What should you be measuring?

This high-level preview from InfoScout is based in part on our conversations with industry stakeholders and studies of Lidl’s European operations. After the launch, InfoScout will share data from Lidl’s first week in the U.S. Based on surveys of actual Lidl customers and in-store observations, we’ll start forming initial assessments of areas in which competitors could struggle, as well as areas in which Lidl may need to improve. Using InfoScout’s proprietary mobile apps, we’ll begin capturing receipt images and data on day one so we can begin to gain a better understanding of purchase behavior and Lidl’s impact on the grocery sector.

What We’re Hearing about Lidl

Lidl’s American stores are expected to be about twice the size of Aldi or Trader Joe’s stores (about 36,000 square feet), but with more than enough space to offer the basics you would expect from a grocery store.

In Europe, Lidl carries mostly private-label brands. We’ve heard from the supplier community that Lidl is engaging some national brands and we’ve seen pictures of private-label product, but the assortment is still unknown. It’s possible they will have an unconventional, rotational product assortment rather than static. In other words, products are on shelves for a limited time and replaced by something similar. What we are certain of comes from an email campaign they sent to customers this month that highlights, “handpicked selections of fresh produce, high quality meats, baked goods, and specialty items.”

Lidl continues to pursue real estate aggressively with a long-term plan in mind. With potentially 500-1,000 stores on the longer term horizon, we can expect new stores opening from New Jersey to Georgia by 2018. In fact, Kantar predicts $9 billion in sales and more than 600 stores in five years. While the first round of openings in the U.S. will occur on the East Coast, Supermarket News is reporting a western expansion into Pennsylvania and Ohio, and stores are already being planned for Texas.

Although Lidl is not expected to engage in price wars, Kantar found that Lidl prices for branded products could be 30% or more cheaper than prices for identical products at Asda, the Walmart-owned, European supermarket retailer. At the basket level, Lidl was 15% cheaper.

Some in the industry are expecting an innovative approach to advertising, with theme-based schemes for short-term discounts. What we do know to be true: before its doors have even opened, Lidl is pushing the rest of the grocery industry to evaluate their pricing and clean up their stores so they’re prepared to compete.

Lidl Metrics You Should Be Watching

Brick-and-mortar grocery stores are struggling with sales for a variety of reasons. Online grocery shopping options continue to emerge, and a variety of retailers, from large discounters to pharmacies to dollar stores, are carrying more and more grocery products. Obviously, there is concern that Lidl will further erode market share and revenue.

At the end of June, InfoScout will provide a detailed report about Lidl’s opening week, based on surveys from actual customers and firsthand visual observations. This data will include everything from customer profiles and perceptions to pricing and impact on the competition:

  • Who are Lidl’s first shoppers in the U.S. in terms of demographics and psychographics? What is the geographic pull of Lidl stores?
  • Where did these folks shop prior to Lidl? Which stores are losing customers to Lidl, and what is the overall impact on American stores thus far?
  • What do shoppers think of the Lidl store format? What are their perceptions of product quality and selection? Are they impressed by the level of customer service?
  • What are shoppers’ initial impressions of Lidl’s prices? How do they perceive pricing at Lidl compared to the competition?

We’re about to find out exactly how much Lidl will affect the grocery sector. Check back with InfoScout at the end of June for a recap of Lidl’s first week, or contact us at to request the latest insights.