The Unstoppable Rise of Aldi

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Three years ago, Ohioans Nicole Papp and Lynne Coristin embarked on a grocery run that would catch the attention of thousands. “We had nearly 10,000 likes [on Facebook],” says Papp. “Before we even got home!” adds Coristin. The pair didn’t know then that their annual “Aldi Aisle of Shame Tour” — a one-day bonanza hitting up various locations of the grocery chain — would become a viral tradition of treasure hunting for gifts, decor, pajamas, plushies, wine, and candy. (“We make sure we buy peanut butter cups and the salted caramels,” says Coristin.)

For their most recent tour, the former coworkers and current friends (Coristin officiated Papp’s wedding in 2021) traveled more than 300 miles — for fun LOL — to 13 different Aldi stores in the Cleveland area. (Impressive to be sure, but they visited a whopping 21 locations in and around Pittsburgh a couple of years ago.) 

Dressed in matching gray T-shirts decorated with paint markers, they spent 14 hours and an undisclosed amount of money on heavily discounted Wonder Woman dog costumes ($1.49 a piece) and tumblers ($2), plus recipe stands, sculpted reindeer (you know the ones), a three-foot alpine tree, and more. “We didn’t even unload the car ‘til the next day,” says Papp.

This level of commitment and fandom typically reserved for the likes of Taylor Swift, Air Jordans, and early iPhone releases, is for — of all things — a discount grocer. “I knew my Aldi was popular,” says Matt Lesky, a former assistant store manager of the Holland, Michigan, store from 2017 to 2021. “But I didn’t realize on a national level the passion people have for Aldi.” 

The love runs deep, and it’s growing. In the nearly five decades since Aldi opened its first store in Iowa in the 1970s, the company has executed on its shrewd plans to capture American shoppers’ hearts — and grocery dollars. After spending billions to expand and revamp stores, refresh product lines, and remake its brand, Aldi is now the nation’s third-largest grocer by store count, behind only Kroger and Walmart.

Aldi wasn’t always a must-stop shopping destination, though. We take a look at how the historically tight-lipped retailer went from niche to number three.

But First, What’s Aldi Again?

For those just hearing the hype, Aldi is a discount grocery retailer with German roots. It is, by its own admission, a smaller, no-frills place with mostly — more than 90% — private-label (or store-brand) products at competitively low prices. The company claims that shopping at Aldi can save you as much as 40 percent on your grocery bill, although reports say that number is closer to 20.

The first store opened in Iowa, but its American origin story really begins in Chicago, the “official launching point into the U.S.,” says Scott Patton, a 28-year Aldi veteran and current vice president of national buying. “The formula in 1976 was simple,” says Patton. “High quality, low price, low overhead, high operational efficiency.” 

These “limited-assortment stores,” as they were commonly referred to back then, were often located in low-income neighborhoods and sold “only fast-moving groceries at rock-bottom prices.” Meat, produce, and anything that required refrigeration were absent from store shelves — that is, when items weren’t directly stocked on the floor. Food stamps (now Supplemental Nutrition Assistance Program, or SNAP) were accepted; coupons or checks were not. Shoppers bagged their own groceries in their own bags (to much chagrin, at least according to news reports) and carried them to their own cars (the nerve!). 

This isn’t all that different from how Aldi operates today. Frequent or even first-time shoppers will recognize some of those early hallmark tactics. They may actually find them endearing.

It’s no coincidence Aldi went from a little-known store in the Midwest to its 2,348 stores across 38 states (plus Washington, D.C.) today. From the start, the chain set an aggressive expansion pace, opening some 225 stores across the Midwest in just 13 years. Despite the pandemic, which slowed growth for many retailers, Aldi was the fastest-growing grocery chain in the U.S. in 2021, for both the number of new stores and square footage.

Even as hundreds of Aldis opened in new cities year after year, shoppers still kinda had to seek them out. The stores were “not in the main shopping centers, but on side streets or in peripheral areas,” writes Dieter and Nils Brandes in Bare Essentials: The Aldi Success Story, which meant lower rents, and, in turn, further commitment to low prices. They were, however, conveniently located next to competitors that carried popular items not (yet) found at Aldi.

In 2017, the company announced even grander plans: a $5 billion investment to increase store count by nearly 50% to 2,500 by the end of 2022 (it missed that goal), expanding into wealthier neighborhoods, and renovating most of the 1,700+ Aldi stores that already existed (think: roomier, brighter, and slightly more graphic). At an average of 17,000 square feet, these new and refreshed stores are still about a third of the size of the typical supermarket, but that’s 100% intentional: “We want to make sure our building is the right size,” says Patton. “But not too big because every square foot you build adds cost.”

A Fierce Approach to Frugality

Aldi’s approach to efficiency is not unlike that of a five-time Olympic-gold medalist. Its dedication to keeping operating costs — and, in turn, prices — as low as humanly possible is relentless. 

Stores are staffed with just three or four people — or only one, if there’s a bad snowstorm or employees call out unexpectedly — who are trained to do multiple jobs and stay on task. Store phone numbers were unlisted (for longer than you might think) — no time or actual phone to answer, anyway! And corralling shopping carts might as well be for the birds. At Aldi, shoppers have to temporarily fork over a quarter to unlock a cart. (Bring the cart back to its corral and the quarter pops back out.)

Early on, Aldi put prices on the delivery cartons products came in, instead of the products themselves (a point of contention with legislators in an attempt to limit “the no-frills movement”) to save on costs. You won’t find any meat or seafood counters, and, after a limited test run, the company shelved plans for in-store bakeries — possibly forever.

Bucking other widely accepted industry standards, Aldi pinched more pennies by installing checkout scanners and accepting credit cards several years after its competitors. “The scanning technology couldn’t keep up with how fast our cashiers were,” says Patton. (To speed things up further, it added oversized barcodes to the product packaging.) 

As a manager, Lesky received daily printouts measuring cashier speeds (you’ve probably seen spoofs) and sent staffers home early on slower days. The biggest metric, “aside from ringing,” Lesky says, “is stocking speed.” Aldi doesn’t have overnight stockers, so the staff has “from 5 a.m. to 9 a.m. to stock the entire store.” When he first started at Aldi, his manager taped stopwatches to the grocery pallets and told him to stock the more-than-six-foot stack of items in 25 minutes. “That’s a very ambitious goal,” he says, adding, “it always end[ed] up being more like 35 or 40.” 

The extreme cost consciousness — at all levels — can be jarring for some. But not repeat customers, who might as well walk around the store (and life) with a flashing neon IYKYK sign over their heads.

An Exponential Growth Spurt

One of the most beloved characteristics of Aldi stores is what you can’t get. Most supermarkets carry more than 30,000 products — Aldi only now carries 1600 (up from 450 in its early years), which means shoppers can get (almost) everything they need and do it quickly. 

“You don’t have to weed through the muck of 15 brands of salsa,” says Alyse Whitney, author of Big Dip Energy (out April 2024) and TV host, who grew up with an Aldi in her town, but didn’t shop at one until she went to college in upstate New York. “I get overwhelmed by choices. If there are too many choices, it’s too much for me. So when I go to Aldi, having fewer choices — with a couple of surprises sprinkled in — is really great.” 

Adding more selection started off small. Aldi first branched beyond its slate of canned goods, shelf-stable snacks, and bags of basic produce (onions, potatoes, apples) and into milk, ice cream (but only two flavors!), and lunch meats in 1980. In the early aughts, store-brand foods began shedding their stigma as “obscure knockoffs” and Aldi got to experimenting. The grocer launched six of its most popular store brands in as many years, including the premium Specially Selected brand (it’s seeing “unbelievable growth,” says Patton), introduced refrigerated produce (which was so popular it caused a backup in the aisle), and swapped out 20% (!) of its entire inventory, increasing the fresh food selection by almost half.

Aldi made notable subtractions, too: In 2015, it removed ingredients, like certified synthetic colors, partially hydrogenated oils (PHOs), and more from all of its store-brand food products.

Influential shoppers, like Ashley Williams, founder and creator of Oh hey!, definitely noticed: “[Aldi] really solidified themselves as a store where you can have quality products at an affordable price.”

Of course, we can’t talk about Aldi without mentioning the glorious frenzy that is Aldi Finds. Located in the center aisle of the store (also lovingly referred to as the Aisle of Shame or AoS), Aldi Finds is “all the fun stuff you don’t intend to buy, but always end up leaving with,” says Lesky. It’s the only aisle Coristin and Papp go down during their Aldi Aisle of Shame Tour, “until it’s time to buy peanut butter cups and salted caramels,” says Coristin. “Then we detour.”

The name has evolved over time, but the concept has been around for decades: Items rotate weekly and are very much here today, gone tomorrow. “I bought a tiki drink hat for my dog. I’ve bought a flamingo-shaped bed for my dog. I bought a suitcase that lasted for six years — all from the Aisle of Shame,” says Whitney. (An airline broke it.) “You never truly know what’s gonna be in that middle aisle,” adds Lesky.

The FOMO is real and, dare we say, intentional. Among other things, it “makes the idea of going [to Aldi] every week so exciting,” says Sarah Fennel, founder of Broma, a (mostly) baking blog and Aldi ambassador (and fan) who describes the stores as having a hint of Costco, Target, and Trader Joe’s — Costco for the warehouse deal vibes, Target for the finds, and TJ’s for the seasonal/specialty items. It’s also a savvy way for the company to rotate in and test out new products before going all-in.

It should be abundantly clear by now that Aldi “do[es] not spend one cent more for decorations, equipment, and facade than is absolutely necessary,” explains Dieter and Nils Brandes in Bare Essentials: The Aldi Success Story. The company famously spent little on advertising for decades. Top executives didn’t give interviews, either, which meant the company relied heavily on its shoppers to spread the word. 

The Aldi Aisle of Shame Community, a Facebook Group dedicated to that center aisle, now has 2.2 million members, including Coristin and Papp. (Coristin also belongs to four more Aldi fan groups on Facebook.) Instagram accounts, like ohheyaldi and theamazingaldi, started as a way for shoppers to “have a conversation with mom friends, but just on the internet,” says Williams. They’ve now amassed hundreds of thousands of followers. 

Shoppers’ fandom has gone from unfamiliar to unwavering in an unbelievably short amount of time: “It went from me telling my friends that I worked at Aldi and them saying, ‘I’ve never been to Aldi — tell me about it.’ to ‘Oh my gosh, I love Aldi, their peanut butter cups are to die for, I go there every week,’” says Lesky, who started posting TikTok videos during the pandemic while working at Aldi. (Years after leaving the company, it’s still his preferred place to shop.) His following grew quickly to 300,000, and while Aldi wasn’t on board with the idea (he was initially asked to shut it down), the company eventually relented and even embraced his newfound celebrity.

These superfans have brought in a swell of newcomers, turned converts. In 2019, remodeled stores saw customer traffic increase up to 40%, according to Patton, and one in five customers who recently switched grocery stores took their business to Aldi — a number that was up significantly from the year before — according to Morgan Stanley.

“Aldi is the less show-off-y version of Trader Joe’s — it’s not peacocking, just existing,” she adds. Which is a nice change of pace, when you think about it.

#Unstoppable #Rise #Aldi

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