Aldi Steps Out — Into the Mall Discount grocer makes U.S. shopping center debut
One-stop shopping convenience has taken on new meaning at Westfield Chicago Ridge, in Chicago Ridge, Ill., where Aldi has opened its first U.S. mall store. In May, the German discount grocer opened a supermarket inside the 800,000-sq.-ft. suburban Chicago center, a property of The Westfield Group. Except for its location, the 20,000-sq.-ft. Aldi is prototypical in most respects.
“In terms of the square footage, layout and other elements, we were very effective in making the store interior fit our freestanding prototype,” said Michael Jessen, divisional VP, Aldi, which operates approximately 1,155 stores in some 29 states. “On the exterior, we worked closely with Westfield and were able to provide a good presentation of the store on the footage that we were given.”
The new store is a replacement for a freestanding 19-year-old Aldi that was located about one mile from the mall. In deciding to replace the store, which had become cramped and outdated, the company entered into talks with Westfield, which has 119 shopping centers in the United Kingdom, United States, Australia and New Zealand, 87 of which have grocers. By country, however, only eight of Westfield’s 55 U.S. centers have grocery stores.
With U.S. shoppers not really accustomed to food stores inside enclosed malls, wasn’t Aldi taking a chance in relocating to Chicago Ridge?
“Supermarkets in malls are much more uncommon in the United States than they are in Europe and other places,” Jessen acknowledged. “But from my perspective, there are lots of benefits to mall locations. Between the constant flow of regular mall traffic and all the employees who work in the shops, this location gives us the opportunity to introduce Aldi values to a whole new group of customers. There are still lots of people who have never set foot in an Aldi. A mall location gives you a captive audience, and most people are hard- pressed not to take a look inside.”
Westfield is confident that U.S. shoppers are ready to embrace the trend. The developer plans to add grocery stores in more of its U.S. centers.
“Carefully choreographing shopping trips and reducing the number of daily stops has never been so critical,” said Catharine Dickey, executive VP corporate communications, Westfield, Los Angeles. “In both the United States and Australia, in-mall grocers have higher sales than their average street locations. So too, Westfield’s shopping centers have provided a larger trade area for the grocer, while the grocery in turn drives traffic for the center by substantially increasing cross-shopping.”
PARKING: Of all the issues that confronted Aldi as it moved into Chicago Ridge, parking was one of the biggest concerns. The new store can only be entered and exited from the mall — it has no direct access to the parking lot. To ease parking concerns, Aldi struck an agreement with Westfield to create “Aldi Preferred” parking just outside two of the mall’s entrances. There are about 75 preferred spaces in total. The two designated areas also feature shopping cart corrals.
“I’m very impressed with how customers are honoring the spaces,” Jessen said.
Aldi made it a point to ensure that the shopping experience at its new mall location resembles that of its freestanding units. It operates on the same low-cost model as other Aldi stores, and offers the same prices and edited mix of products. In keeping with the chain’s updated design, the store is bright and modern, with colorful signage.
“From a construction standpoint, we tried to be as close to prototypical as possible while respecting that we are located in the interior of an attractive center,” Jessen said. “As the customer approaches our entrance, they see what is fairly close to our prototypical entrance way.”
To date, the mall location has not been a drawback. If anything, it is working to Aldi’s advantage. Although it’s still early for any major assessments, foot traffic is up compared with the store it replaced.
“We’re seeing volume increases,” Jessen said. “Overall, we are thrilled with the response so far.”