How behavioural economics powers Aldi’s rapid growth

The name ‘Aldi’ is a portmanteau (a combination) of ‘Albrecht’, the surname of the brand’s three founders, and ‘discount’, reflecting how deeply Aldi’s cost-effective nature is embedded in its identity. While the retailer receives swathes of plaudits for its consistent, low-price, high-quality, no-frills business model, less ado is given to how psychological strategies underpin its success.

Few companies utilise behavioural economics, the study of how psychological influences empower the decision-making of economic agents, more effectively than the German supermarket chain Aldi. These psychological elements have driven Aldi’s brand progression, helping it to outgrow longstanding UK brands such as Tesco and Sainsbury’s and become America’s fastest-growing supermarket, all contributing to its status as the world’s fourth largest supermarket chain.  

Focusing on the UK, Aldi’s success has been astonishing. With over 1,000 stores spanning 11 distinct regions, from Scotland to South West England and nearly everywhere in between, Aldi has become an ascendant force in the contested UK supermarket sector. During the food inflation surge of 2023, Aldi saw a 25% increase in sales, a growth trajectory which has persisted, with Aldi now holding a market share exceeding 10.1% – making it Britain’s fourth largest supermarket in terms of market share despite only opening its first UK store in 1990. Aldi’s secret weapon in achieving such monumental growth? A store environment that leverages underlying behavioural psychology to maximise the economic activity of its customers.  

Aldi stores are simple, minimalist, and uniform with monotone grey walls dressed with black signage. The colour within an Aldi supermarket radiates not from invasive, overbearing in-store marketing or a sickly brand colouring (looking at you, Asda) but instead from the products and their packaging. This draws customers’ attention to products whilst reducing the cognitive load that visiting an Aldi store elicits, producing a less overwhelming shopping experience. At Aldi, you are not overwhelmed by a ludicrous amount of product options or bombarded with countless offers plastered on every wall, in every crevice, and even hanging overhead. This, combined with the efficiency with which cashiers process customers through the retailer’s tills, results in Aldi’s one-way aisles being less populated than other supermarkets, culminating in a more relaxed shopping experience.  

Additionally, Aldi does not offer coupons, reward cards, or loyalty schemes. The price displayed is the price every customer pays, reducing the need for individuals to plan for the sake of a financially optimised food shop. Not only is this enticing for the less meticulous customer, but by further reducing cognitive load, they feel they are making informed, rational decisions, reinforcing Aldi’s brand as the choice for pragmatic shoppers.  

Building upon its widespread utilisation of psychological principles, Aldi does not serve as a battleground for competing major brands. Whilst some brands are stocked to meet basic consumer expectations, such as Coca-Cola, many often feel overwhelmed by oodles of conflicting brands. Instead, Aldi aligns with Simplicity Theory, stocking one or two of each product, allowing customers to shop more quickly and without the judgement call of choosing from scores of product variants. Taking the onus off the consumer to choose the right option by providing at most two high-quality, affordable options increases efficiency and subtly instils a perception that the customer has purchased less than they actually have. If a customer takes the time to debate a whole section of varied options, they subconsciously equate that time investment to having spent more, reducing total spending. Aldi subverts this market standard, maximising the average customer spend and allowing it to stock inexpensive, lesser-known, or Aldi-group products.  

Simplicity Theory, however, is only effective if consumers have confidence in the products stocked. To ensure this is the case, Aldi has endeavoured to build a genuine reputation for stocking only first-rate goods, reflected in the countless accolades received by the chain. From beef to laundry detergent to gin, the number of award-winning products Aldi shoves onto its shelves is deeply impressive, with the retailer ensuring all marketing campaigns at the very least mention this plethora of honours. In doing this, Aldi has created an implicit association with quality, creating an unquestioned heuristic bias in which individuals never hesitate on its unrivalled value. This, in turn, creates a deeply loyal customer base that rarely, if ever, considers custom at any of Aldi’s competitors.  

By integrating behavioural economics into its strategy, Aldi has developed a significant comparative advantage over its competitors. Designing its customer experience with a set of core psychological principles in mind has led to the creation of a deeply loyal base of shoppers, the result of the efficient, comparatively relaxing, and notably consistent quality of Aldi’s customer experience and products. The discourse surrounding Aldi is practically gleaming, resulting in its cult-like Aldiites only growing in number year after year. Aldi’s growth appears exponential, and with nine new stores opening in London alone in 2025 as part of a broader £650 million UK-wide expansion plans, there is no sign of this breakneck growth faltering anytime soon.