Value grocery stores outperform traditional grocers in visit growth

June 25, 2024

Aldi and Grocery Outlet Bargain Market reported growth through both expansion and visits to locations.

Placer.ai recently found that limited-assortment grocery stores like Aldi and Grocery Outlet Bargain Market have performed well in recent years as consumers increasingly sought to reduce inflationary pressures and associated price increases, particularly in key areas like groceries.

That has only intensified. That’s perhaps not surprising, since grocery prices have not been declining, just rising at a slower rate. The results for the two chains are significant. “In May 2024, visits to Aldi and Grocery Outlet Bargain Market increased 26.3% and 14.3% year-over-year, respectively – while visits to traditional grocery chains increased 7.9%,” wrote Placer.ai.

Limited-assortment grocery stores use a few strategies to keep costs low for consumers. They carry fewer products overall than a typical grocery chain, which reduces overhead, and also use other techniques such as private-label products, opportunistic merchandising, and fewer in-store amenities.

According to Placer.ai’s foot traffic marketing, “visits across the grocery store grew 7.9% year-over-year, while Aldi and Grocery Outlet Bargain Market saw increases of 26.3%, 14.3%, and 15%, respectively.”

The growth was driven by several factors. “Aldi has opened dozens of new stores in 2023 – with hundreds more planned – and Grocery Outlet Bargain Market has also significantly expanded its presence,” said Placer IA. “But the average number of visits to each store for both brands has also increased, again outpacing traditional grocery stores, showing that their expansion is meeting robust demand.”

In the first five months of the year, Aldi posted double-digit year-over-year growth: 16.1% in January; 25.9% in February; 23.3% in March; 21.6% in April and 23.2% in May. By comparison, Grocery Outlet Bargain Market posted 4.2%, 9.8%, 9.9%, 7.2% and 8.4% growth. Traditional grocery stores lagged behind at 2.4%, 8.2%, 9.4%, 3.9% and 8.1%, falling short in each month.

In addition, both limited-range chains have seen an increase in customer loyalty over the past three years through an increase in loyal visits. “In April 2022, for example, 28.0% of visits to Aldi and 27.0% of visits to Grocery Outlet Bargain Market were made by people who visited the chains at least four times during the month – but by 2024, these shares increased to 30.1% and 30.2% respectively. A similar trend was observed in May 2024.”