The supermarket may be an American invention, but the influence of global players on U.S. grocery is undeniable. German-owned Aldi has built a loyal U.S. following for decades, and its rival Lidl has followed suit. Their success has reshaped shopper expectations, especially during times of economic pressure.
With smaller stores, tight assortments, and a heavy reliance on private label products, these discounters have proven that value and simplicity resonate with shoppers. In fact, pricing on key value items (KVIs) drives much of consumer perception around whether a retailer is a “good deal.” RDSolutions tracks pricing on 35 KVIs across 20 grocery chains and consistently finds Aldi at the low end of the spectrum, with Amazon and Lidl not far behind.
Private label is at the center of this shift. Today, it represents 20% of the U.S. grocery market and is projected to grow to 24% by 2030. RDSolutions’ own consumer survey shows 86% of shoppers have switched to private label for at least some products, with three-quarters saying store brands match or exceed national brands in quality. Europe offers a glimpse of the future, where private label already makes up 40% of grocery sales in some markets.
Major U.S. retailers are responding aggressively. Costco’s Kirkland Signature, Walmart’s Bettergoods, and Target’s Good & Gather are expanding quickly, proving that store brands are no longer “generic”—they’re central to differentiation and loyalty.
So what does this mean for small chains?
Unlike Walmart or Aldi, small and regional grocers can’t win on price alone. Competing effectively requires sharper positioning and smarter tools:
- Know where you stand. Use market intelligence platforms like Intrics from RDSolutions to benchmark your pricing against both discounters and regional competitors. Understanding your gaps on KVIs is the first step toward shaping shopper value perception.
- Differentiate with assortment. While discounters thrive on limited choice, small chains can stand out by curating the right mix of national brands, local products, and specialty items that resonate with their shoppers.
- Leverage private brands. Store brands offer one of the strongest opportunities to compete head-to-head with larger players. Private label delivers margin benefits while reinforcing your unique identity — and, when executed well, can rival national brands in taste, quality, and trust.
The message is clear: discounters are setting the pace, but small chains don’t have to follow their playbook. By using data to stay competitive on perception-driving items, curating an assortment that reflects their community, and leaning into private brands, independents can carve out a position that price alone can’t buy.
New AWG members who sign up for platform access will receive a 7% discount off the list price. The platform is customizable to your business needs, offering a subscription that includes minimum, maximum, and mode competitive prices for each retailer and market. For data on competitors or regions not covered, members can contact RDSolutions directly. Jessica Duke at RDSolutions can be reached at jessica.duke@rdsolutions.io
