Lidl panettone becomes taste of Christmas in broke Britain

Bloomberg

Britons normally splash out on food at Christmas, trading up to more premium grocers for turkeys and mince pies. This year, amid the worst cost-of-living squeeze in memory, they’re heading to Aldi and Lidl.
The German discounters have escalated their challenge to traditional supermarkets like Tesco Plc, slashing prices of fowl and vegetables to try to attract last-minute shoppers.
As competition heats up, grocers are facing eroding profit margins, with J Sainsbury Plc pledging more than £15 million ($18 million) worth of price reductions to keep Christmas costs down.
Aldi and Lidl, which have been on the ascent for years, have gained further ground in 2022 amid soaring inflation.
Aldi overtook Wm Morrison Supermarkets in September to become Britain’s fourth-largest grocer. Now the discounters are turning into holiday shopping destinations.
Demand for Lidl’s holiday range began building last month, with panettone sales up 10% on last year.
“There is no doubt that Aldi and Lidl have become part of the Christmas shopping scene,” said Clive Black, a retail analyst at Shore Capital.
“Because of the straitened times they’re gaining unnatural business, so it will be a fight for the other supermarkets.”
That’s evident in the grocery aisles, where stores have cut vegetable prices as a potential loss-leader to get shoppers through the door.
Aldi, Lidl, Tesco and Sainsbury are selling Brussels sprouts, carrots and parsnips at 19 pence a pack. Even upmarket Waitrose has reduced its offering to 30 pence.
Tesco, Aldi and Lidl have also dropped the price of turkeys to as low as £3.99 per kilo before Christmas.
“The competition is much more intense than previous years,” said Maureen Hinton, global retail research director at GlobalData Plc.
“Everyone is looking for value at the moment.”
Traditional supermarkets are using loyalty programs to encourage customers to come back. Budget supermarket chain Iceland Foods started its Christmas bonus card-savings program in August to try to get ahead of rivals.
Morrisons offered money-off vouchers to loyalty card customers who shopped with the grocer for four weeks in the run-up to the festive period.