UK Food and Non-food Discounters Market Report 2024
It’s not only cheaper prices that drive consumers to discounters, but also convenience, with 55% opting for discounters which are closest to them.
Trusted by leading global brands
Collapse All
-
Executive Summary
- Opportunities for the discount retail sector
- Leverage technology to provide an in-store experience that meets shopper preferences
- Loyalty schemes can play a pivotal role in retaining and acquiring customers
- Opportunity for discounters to expand in convenience
- Market dynamics and outlook
- Market size & forecast
- Market predictions for discounter sector
- Discount sector sales forecast to reach £54.3 billion in 2029
- Aldi by far the biggest retailer in the discounter sector
- Inflation has fallen rapidly and financial sentiment is showing signs of improvement
- What consumers want and why
- Discounter shopping is near-universal, with 95% shopping at discounters in the past year
- Graph 1: discounter typically shopped and spent the most with, 2024
- Discount shopping is a longstanding habit, with 53% having shopped in the sector for five or more years
- Graph 2: length of time shopping with discounters, 2024
- A minority (29%) shop with discounters online
- Graph 3: discounters shopped online with, 2024
- Food cupboard items, household cleaning products and health & beauty products the most popular purchases
- Graph 4: non-food products typically purchased from discounters, 2024**
- Graph 5: food & drink products typically purchased from food discounters, 2024
- Shoppers prioritise lower prices when choosing discounters, store proximity and better-quality products are also significant influences
- Graph 6: factors which would encourage discount shoppers to shop with one discounter over another, 2024
- Exclusive products and comparable quality at discounters will keep shoppers coming back even if they have more money
- Graph 7: attitudes towards discount shopping, 2024
- Retailer activity
- Loyalty rewards, sustainably focused discounters and brand extensions transforming the discount shopping experience
- Discounter advertising spend reaches record high, with 2.9% increase in 2023
- Graph 8: total above-the line, online display and direct-mail advertising expenditure by the UK’s leading discounters, 2020-24
-
Market Dynamics
- Market size
- Discounter sector sales expected to reach £43.5 billion in 2024
- Graph 9: market size for food and non-food discounters (excl. VAT), 2020-24
- Sector sales growth slows as the peak inflation period ends
- Market forecast
- Sales forecast to grow by £10 billion between 2024 and 2029
- Discount sector expected to grow 25% between 2024 and 2029
- Food discounters sales forecast to grow 30% between 2024 and 2029
- Non-food discounters sales forecast to grow 12% from 2024 to 2029
- Market drivers
- Mixed-but-improving financial sentiment suggests the pinch felt by consumers is easing
- Graph 10: the financial wellbeing index, 2016-24
- Inflation has dropped significantly and grocery prices are rising at their slowest rate in months
- Graph 11: CPI and food and drink inflation rate, 2022-24
- All income groups adopting budget-conscious habits
- Opportunity for discounters to position themselves as the go-to source for indulgences that don’t break the bank
- Nearly six in ten are still grappling with rising grocery prices
- Graph 12: percentage of consumers who have been affected by increases in food and drink prices at supermarkets over the last two months, by household income, August 2024
- Discounters can tap into frugal grocery shopping behaviour
- Discounters should highlight quality to boost own-brand food & drink appeal
- Lidl can gain an advantage in the own-brand food & drink market
-
What Consumers Want and Why
- Discounters shopped with
- Vast majority shop with discounters
- Discounter shopping is near-universal, but less prevalent among older age groups
- Non-food discounter shoppers peaks among Gen Z and low-income earners
- Graph 13: non-food discounter shoppers, by age, 2024
- Graph 14: non-food discount shoppers, by income, 2024
- Gen Zs and high-earners are most-prevalent food discounter shoppers
- Graph 15: food discount shoppers, by age, 2024
- Graph 16: food discount shoppers, by income, 2024
- Aldi the single most popular discounter, Poundland and B&M the most-shopped non-food discounters
- Savers shopper numbers jump, while Wilko sees a sharp decline
- Aldi leads the pack in terms of shopper engagement
- Lidl closes the gap on Aldi in the food discounter battle
- Graph 17: discounters typically used, 2023-24
- Lidl’s loyalty scheme a game-changer in food discount market
- A third spend the most money with Aldi
- Graph 18: discounter spent the most money with, 2023-24
- 66% of shoppers typically shop at five or more discounters
- Graph 19: repertoire of discounters shopped at, 2024
- Permanent price cuts could help combat switching between discounters
- Bigger range of categories can increase shopping frequency, currently just once a month or less for many shoppers
- Graph 20: frequency of discounter usage, 2024
- Non-food discounters fulfilling more grocery shopping missions
- Fewer new discount shoppers signals market saturation and a move towards higher-end alternatives
- Graph 21: length of time shopping with discounters, by financial situation, 2024
- Discounters and online
- Strong belief that the best deals are found online should motivate discounters to expand online shopping
- Graph 22: discounters shopped with online, 2022-24
- On-demand delivery would encourage 38% to shop online more often
- Graph 23: consumer agreement that the availability of rapid delivery services would encourage them to shop online at discounters more often, by age and household income, 2024
- A bigger focus on mobile shopping could help discounters boost online shopping
- Food & drink purchased at food discounters
- Store cupboard essentials the most-purchased product from food discounters
- Graph 24: food & drink products typically purchased from food discounters, 2022-24
- Rising prices combined with a reputation for quality attract shoppers to buy alcoholic drinks from discounters
- Graph 25: alcoholic drink purchases from food discounters, by age and financial situation, 2024
- Reassure consumers that more-affordable price doesn’t mean they have to compromise on quality
- Discounters well-positioned to capitalise on demand for lower-priced no- and low-alcohol alternatives
- Aldi’s 0% gins and brand new 0% wine that has never been seen on shelves before
- Non-food purchases at discounters
- Everyday essentials, household cleaning products (60%) and health and beauty products (45%) the most popular non-food purchases
- Graph 26: non-food products typically purchased from discounters, 2022-24
- Designer beauty dupes without the hefty price tag
- Beauty bundles can appeal to consumers who prioritise cost savings
- Demand for cheaper household cleaning products an opportunity for discounters
- Aldi’s detergents not only beat major brands, but are also better for the planet
- Opportunity for discounters to tap into the rising demand for affordable back-to-school essentials
- Cost-conscious shoppers’ growing appetite for discount fashion
- Graph 27: clothing purchases from discounters, by gender and age group, 2023 and 2024
- Poundland extends fashion offering and Lidl launches new clothing dupe range
- Factors which would encourage shoppers to choose one discounter over another
- Cheaper prices the main reason to choose one discounter over another
- 60% of discount shoppers select their discount retailer primarily for its lower prices
- Graph 28: factors which would encourage discount shoppers to shop with one discounter over another, 2024
- Bolster price competitiveness with digital price tags
- Lidl steps up pricing offensive to make shopping even cheaper
- Over-60s are struggling with costs
- Better-quality products is a differentiator for 43% shoppers
- Aldi’s Lacura and Specially Selected and Lidl’s Deluxe balance affordability with exceptional quality
- Loyalty scheme rewards sway 29% of shoppers when choosing a discounter
- Personalise loyalty scheme deals and discounts to shopper preferences
- 55% of discount shoppers choose retailers based on proximity
- Aldi Local: closer to home and bigger than a traditional convenience store
- Aldi and Lidl invite shoppers to suggest store locations
- Speedy checkout experience can build loyalty among younger shoppers
- Lidl pilots self-scanning
- Checkout anywhere in-store
- Aldi testing smart shopping trolleys to speed up the checkout process
- Attitudes towards discount shopping
- Just under two-thirds don’t see a difference in quality of product to rival retailers
- Unique food & drink, a dynamic product offering and quality comparable to traditional retailers make discounters compelling
- Graph 29: attitudes towards discount shopping, 2024
- Exclusive food & drink products give discounters a competitive edge over traditional food retailers
- Aldi on the hunt for original food & drink products
- Aldi stands out as a go-to destination for discovering unique food & drink products
- Unexpected treasures will keep discounter shoppers coming back
- Lidl transforms the ‘treasure hunt’ shopping experience into a digital adventure
- Better customer service would elevate the in-store discounter shopping experience
- Shoppers are likely to be more supportive of discounters championing locally sourced products
- Aldi bolsters locally sourced product messaging with new shopping website…
- …and reinforces its connection with Scottish shoppers by supporting local breweries
- Lidl beefs up sustainability messaging around locally sourced food
- In-store navigation app would enhance the discount shopping experience
- New discounter app makes aisle navigation easier and saving money effortless
- Slow it all down (at least once in a while)
- Cheaper prices, proximity, quality, product range, and loyalty rewards is a compelling proposition for 91% of discount shoppers
- Cheaper prices is a definite competitive advantage for discounters
-
Retailer activity
- Leading retailers
- Aldi’s sales and profits soar
- B&M’s sales surge
- Poundland revamps its stores to feature enhanced general merchandise range
- Poundstretcher sold
- Rising demand for affordable health & beauty products and new stores boost sales for Savers and W Boyes
- Leading discounters: revenues
- Aldi and Lidl set sights on more stores
- Shopping at Aldi peaks in the North and Midlands, Lidl dominant in Inner & Greater London
- Graph 30: Aldi, Lidl and Heron Foods shoppers by area, 2024
- Quality Save disappears from the high street, and Wilko is back!
- B&M store openings accelerate and Heron Foods target the North and Midlands
- Poundstretcher and OneBeyond open in former Wilko stores and The Original Factory Shop hits 200th milestone
- Leading discounters: store numbers
- Market share
- Aldi stands as the undisputed leader in the discounter sector
- Graph 31: leading discounters’ estimated share of all discounter sales, 2023
- Aldi and Lidl’s share of all food retail sales reach nearly 16%
- Graph 32: food discounters estimated market share of all food retail sales (excl VAT), 2023
- Non-food discounters hold nearly 40% of the mixed goods retail market
- Graph 33: non-food discounters’ estimated share of all mixed goods retail sales (excl. VAT), 2019-23
- Savers’ share of health and beauty sector sales falling
- Graph 34: Savers Health and Beauty Ltd share of specialist health and beauty sector retail sales (excl VAT), 2019-23
- Launch activity and innovation
- Lidl leverages its network of EV charging points to power-up rewards
- Netto opens Europe’s largest autonomous discount supermarket
- Discounters saving shoppers £££’s and preventing good food going to waste
- Lidl experiment with pop-up stores
- Aldi testing its first ever loyalty scheme
- Wilko building out its DIY offering
- Poundland rolls out new rewards scheme
- Advertising and marketing activity
- Leading discounters’ total advertising spend up 2.9% in 2023
- Graph 35: total above-the line, online display and direct-mail advertising expenditure by the UK’s leading discounters, 2020-24
- Majority of advertising spend is through TV, but its share is steadily decreasing
- Graph 36: proportional distribution of total above-the line, online display and direct-mail advertising expenditure by the UK’s leading discounters, by media type, 2022-24
- Lidl Plus app once-in-a-lifetime experiences
- Aldi’s new TV campaign is all about showcasing its unbeatable mix of price competitiveness and quality
- Aldi pokes fun at its competitors’ attempts to price match its products
- Poundland launches first TV advertising campaign for new ranges
- B&M’s everyday low prices food campaign
-
Brand Research
- Food discounters enjoy the highest level of trust and differentiation across the sector
- Aldi edges out Lidl as the most-trusted brand
- Aldi a favourite retailer for nearly one in five, with a third having an excellent experience, and 88% recommending it
- Aldi’s unique gin club stands as a prime example of its innovative spirit
- Lidl demonstrates commitment to customer service by offering round-the-clock support
- Food discounters stand out from their non-food counterparts through their innovation and customer service
- Aldi taking steps that positively impact the environment
- Lidl rewards shoppers for sustainable behaviour
- Ethical practices can set discounters apart, with many people already viewing them as accessible
- Poundland doubles down on £1 lines, underscoring its commitment to lower prices
- Poundland distinguishes itself for being the least expensive
-
Appendix
- Supplementary data
- Wage growth slowing
- Graph 37: real wage growth, annual % in wage growth vs inflation, 2022-24
- Financial confidence over the coming year looks largely positive
- Graph 38: how consumers feel about their financial situation over the next year or so, 2024
- Nielsen Ad Intel supplementary data – leading food and non-food discounters
- Market forecast data and methodology
- Total discounter market size and forecast: underlying data
- Food discounters – market size and forecast: underlying data
- Non-food discounters – market size and forecast: underlying data
- Total discounter market forecast and prediction intervals
- Food discounters market forecast and prediction intervals (value)
- Non-food discounters market forecast and prediction intervals (value)
- Forecast methodology
- Report scope and definitions
- Market definition
- Data sources
- Abbreviations and terms
- Consumer research methodology
- Nielsen Ad Intel coverage
This report provides a detailed review of the UK discount retail market. Respond to your customers’ preferences and behaviours in real-time with data-backed analysis and accelerate your insight strategy today.
UK Food and Non-food Discounters Market – Current Landscape
It’s not only cheaper prices that drive consumers to discounters, but also convenience, with 55% opting for discounters which are closest to them. By positioning themselves in town centres and high streets, close to where people live and work, discounters can meet the demand for convenience from existing customers and attract new shoppers looking for quick and easy shopping solutions. In a sector where supermarket convenience stores are often perceived as pricey, discounters can also stand out, with Aldi’s Local store format being a good example of future market development.
The discounter market is fiercely competitive, with shoppers readily switching retailers if prices aren’t favourable. Implementing loyalty schemes in this sector is challenging due to low margins, but the availability of schemes would sway 29% of discount shoppers to pick one discounter over another. Lidl’s commitment to enhancing its loyalty scheme exemplifies the potential rewards of such investments, despite the challenges.
Discounters can broaden their appeal by tapping into the excitement of deal hunting. By offering a dynamic shopping experience with an ever-changing inventory, they can transform each visit into an exhilarating treasure hunt. This strategy not only attracts bargain seekers, but also appeals to a wider audience who value the emotional thrill of finding unique items.
UK Food and Non-food Discounters – Market Statistics
- Discount retail market growth: Sector growth is expected to slow to 2.9% in 2024. While this may seem significant, it’s important to recognise that the high growth rates in 2022 and 2023 came out of inflation which accelerated value growth.
- Discount retail food purchased: Store cupboard essentials (eg crisps/tinned goods) remain the most bought product type from food discount retailers with 71% of consumers typically buying these.
- Discount retail non-food purchased: Budget-friendly dupes are growing in popularity with 49% of UK consumers agreeing that dupes are an effective way to save on beauty and personal care products.
UK Food and Non-food Discounters Market Report – What’s Inside?
Key Topics Analyzed in the Report
- The impact of inflation on food and non-food buying habits; the categories consumers are most willing to shop around to get the best deals on, and the opportunities within this for the discount retail sector.
- The widespread appeal of discount shopping and the most popular food and non-food discounters consumers shop with and spend the most money with.
- How discounters can go beyond the obvious lure of cheaper prices for shoppers and improve convenience and quality to retain customers and grow market share.
- How friction points in the discounter shopping experience can be eased and the in-store experience elevated through innovations and improved customer service.
- The growing importance of loyalty schemes for discounter retailers to retain and expand their customer base.
Report Scope
This Report examines the UK discount market that it is a broad term rather than a clearly identifiable segment. As a result, we have decided to identify specific retailers that fall into our definition of a ‘Discounter’.
Our definition of a discounter is a retailer that not only uses price as its defining feature, but also follows the discount model of having extremely tight cost controls and very focused buying. On top of this, the retailer must, for the majority of its stock at least, have consistent product lines; because of this the Report will exclude outlet stores like TK Maxx.
Ultimately this means that our market size is based on a fairly limited list, but we believe that this methodology is fair since true ‘discounting’ is for larger retailers; smaller stores are unable to truly achieve the economy of scale required.
Meet the Expert Behind the Analysis
This report was written by Steven Mayles. Steven joined Mintel in 1988, graduating in 1987 from the London College of Printing with a Higher National Diploma in Business Studies. In his role as a Retail Analyst Steven writes Mintel’s series of European Reports. In addition to retail, Steven has gained considerable insight into automotive retail.
While low prices attract shoppers, a focus on location and quality offers discount retailers a chance to stand out and capture market share.
Steven Mayles
Retail Analyst
£ 2,195 excl. Tax
Secure direct checkout
Instant PDF download
Portal access included
Need help deciding?
Get in touch
Trusted by global industry leaders
One of the biggest challenges we face is the need to get smart on a business or category real quick.
We are talking to clients who live and breathe their category every day and the expectation is that we will be able to get caught up very quickly, and bring the thinking that can help them.
We need to do that often in a matter of days, so it’s not a small ask. Mintel gives us a very articulate view of category conditions and does so at the speed we need it.
Jeff White, Business Development Director, Deutsch
Mintel is really good for getting a handle on a particular category quickly. If we are working on a new business pitch in an area we don’t have much experience in, it’s a brilliant way to get up to speed with what’s going on, what’s changing and what the key trends are in any category.
It’s very rare now that anyone will plough through a 200-page report – that’s why the summaries are really useful. We know they are backed up by a lot of detail, so if you need to go into something in more depth you know the information will be all there for you.
Pauline Robson, Managing Partner, Mediacom
When I’m investigating specific sectors I tend to use Mintel reports for their forecasting, which I’ve always found to be very accurate.
They also offer really broad and deep coverage in their reports. They are very, very detailed. For example, we were able to gain insight across a wide range of business areas from just one report, proving that Mintel is excellent value for money.
So overall, it’s the level of detail and the quality of forecasting that really stand out for me.
Rebecca Green, Market Insight Manager, Wincanton
At Jackman, we believe that powerful strategies are based on human insight. Mintel’s leading-edge reports and insights into consumer attitudes and behaviors are an important input as we develop and execute strategy.
Alana Gavin, VP Research and Insights, Jackman
We use Mintel Reports, mostly for financial services and ecommerce markets, plus a few retail and technology ones.
As a leading payments provider, we value additional insights into consumer behaviour, opinions and trends that are shaping the many different markets we operate in. Mintel is a very good and very quick way for us to obtain those insights.
We use Mintel to get a view on where a particular market is going, which can support us in product development and help us identify opportunities or indeed risks, it is a very useful barometer of a market’s potential.
Andrew Neeson, Market Intelligence Manager, VocaLink
We’ve found it so useful working more closely with Mintel. They helped support our recent flagship event for our top suppliers by providing a really unique viewpoint on the future of online retailing.
Nick Carroll from their Retail Team was also an excellent panelist, sharing useful and actionable consumer insights. We definitely look forward to working with Mintel again on future projects.
Zac Steele, E-Commerce Trading Development Manager, Waitrose & Partners
We use Mintel to inform our thinking and reinforce strategy. If you’re presenting new ideas, it’s essential they are underpinned by robust data and evidence, and clearly rooted in fact.
Mintel gives us all that. It’s a great brand and one that is trusted by clients.
Marie Stafford, European Director, The Innovation Group, VML
We have such a great working relationship with Mintel on lots of different levels. As an insight partner, they have helped us to develop our business planning in specific categories as well as supporting our creative process but they’ve also been super helpful with facilitating our events in their inspirational offices near St Paul’s.
They’re an innovative company, with a client-focused team that always delivers.
Abby Carvosso, Group Managing Director, Bauer Media Group
There is no question that Mintel is the go-to resource for the best quality market research, but I did not think it was an affordable option for Abacus Marketing to consider. As a small marketing agency, we only work with a few new clients each year.
However, we have a very high-end consultative approach to our work, so we really do need a partner like Mintel to provide the big agency experience we are always aiming to deliver. Our clients come from an incredibly diverse range of industry sectors, so we obviously need access to market research reports from a very wide spectrum of marketplaces – and that is precisely what we got.
Stephen Taylor-Brown, Managing Director, Abacus
Mintel helps us when we want to know something quickly – it provides fast answers to our questions. If we need to get a view of what’s going on in a particular market it’s very useful.
When carrying out background research, I find Mintel an excellent starting point.
The fact that it covers so many markets is a big plus for me– instead of having to buy specialist products in each area we are interested in, especially when we only require a brief view on a particular market, we can go to Mintel for help as a one-stop shop. I find Mintel a useful and valuable resource.
Ben Zeidler, Director - Research and Analytics, Tenth Wave
We utilize Mintel Reports, Trends and Comperemedia to mine for insights across the numerous business verticals that Epsilon serves, such as CPG, automotive, telecom, healthcare/pharma, retail and financial services.
By integrating Mintel insight into new business opportunities, we have been able to gain the competitive edge necessary to advance partnerships with global brands and key business players.
For our organization, it’s about depth and breadth. Having one without the other doesn’t enable success in our business.
Virginia Harvey, Secondary Research Manager, Epsilon
Working in a customer-obsessed organization means that data and insights have to be at our fingertips. Mintel’s reports help us support anecdotes with real quantifiable insights. The summary sections (which I really like) helps save time by giving a birds eye view of the content before spending time combing through the pages.
Our business review discussions are strengthened by the relevancy of the reports to help us better understand our customers. In addition, the customer service received from the team (especially in crunch periods) makes the process of understanding customer behavior even better.
Ngozi Ngonadi-Nkwoji, Senior Marketing Manager, Amazon
