Inside Lidl’s new game plan for growing its brand in the U.S.
After restructuring its U.S. business and overhauling its C-suite, European retailer Lidl has been working to reposition its brand as a value player with American shoppers.
The company first opened U.S. stores in 2017 but the expansion has had some fits and starts. The U.S. division has had five different CEOs, according to Grocery Dive. The latest is Joel Rampoldt, former managing director of consulting firm AlixPartners, who joined in August 2023. In March 2024, Lidl U.S. named four new executives and cut an undisclosed number of jobs, a year after letting go of 200 workers in the states.
Lidl now operates more than 180 stores in nine states and Washington, D.C. The company is mainly focused on expanding within its existing markets of New York, Washington D.C. and Atlanta, with the goal of being “really the only grocery store that offers incredible quality at unbeatable prices, despite rising costs with inflation or other external factors,” Frank Kerr, chief customer officer for Lidl U.S. told Modern Retail. This comes as Aldi, another European retailer much more established in the states, plans to add 800 stores over the next few years.
Last October, Lidl reintroduced its brand with a new campaign labeling it as “the super-est market,” centered on its curated assortment of private-label products, global imports and name brands with new branding components and updates to its experience online and in stores.
Kerr — who rejoined Lidl in 2022 after several years at Save A Lot — said the company wanted to remind customers of its value after making adjustments to its assortment. Much of this work was done in the meat and produce departments, such as by launching a new private label brand for meats called Butcher’s Specialty. The company had also made changes to its web experience, such as implementing feature sections for hero products in the store like its 49-cent croissant and Mini-Mix ice cream bars. “This was about driving brand awareness and ultimately communicating to customers who we were as Lidl and getting across our ultimate value proposition of what we can deliver as a retailer,” Kerr said.
A recent on-the-ground test substantiated Lidl’s claims of lower prices, at least in one market. In October, Business Insider compared pricing at a Lidl in North Carolina to regional chain Publix and found the same grocery list was $40 less at Lidl, with lower prices on items like cilantro, green beans, meats and milk.
Another key growth area for Lidl U.S. is its bakery featuring a mix of unique European items and products Americans expect to see on shelves, Kerr said. “That fresh bakery hits you right in the face when you walk into our stores. It has that immediate impact on the customer and is really unmatched to what we see within the market.”
Simon Johnstone of Kantar, an analyst who helps brands understand the impact of European value retailers’ growth in the U.S., said Lidl has struggled to differentiate itself and catch up with Aldi’s success in the American market. “They need to build up trust in the brand and in the products, but that takes time,” Johnstone said. “It’s not a quick growth story.”
Still, Johnstone said Lidl appears to have a better understanding of the kind of shopping trips it is best for and where to place its stores. Its biggest differentiators with Aldi and other grocers are in small-basket trips, he said.
“It’s very similar almost to what you could do at a Trader Joe’s, as well — that kind of treasure hunt, in terms of food and experience and discovery,” Johnstone said. “The other part of them being successful is they want to be trusted, but they also want to be sort of a recommended retailer, something that’s talked about.”
Lidl’s efforts come at a time of rising food costs and other macroeconomic challenges like the threat of potential tariffs. Lidl has a few different operational initiatives aimed to keep costs low and keep the stores efficient and sustainable: requiring customers to use reusable bags, delivering products in shelf-ready cases and using electronic shelf labels. Like Aldi, Lidl also has a much smaller footprint and smaller assortment than a typical grocery store.
“It is a dynamic environment that we’re facing in the U.S.,” Kerr said. “I wouldn’t say that is unique to us versus anyone else, and we’re rapidly adjusting to some of those changes and making improvements to always deliver the perfect amount of quality and price to our customers.”