Discount chain Aldi is partnering with Instacart to deploy the grocery intermediary’s Connected Stores solution. Here’s how it works:

• In-Store mode on the Instacart app enables customers to see what’s in-stock, sort items by aisle, and access in-store promotions and discounts.
• With Carrot Tags, in-store shoppers can select an item on their phone and the corresponding shelf label will flash, making items easier to find.
• Instacart’s pickup fulfillment technologies help store associates easily pick and pack items for curbside pickup.

The partnership comes as consumers are increasingly turning to discount retailers like Aldi in the wake of high food costs.

• Aldi was the top performer by average visit per location and overall visit growth in July 2024, according to the Placer 100 Retail & Dining Index.
• Average visit per Aldi location grew 22.6% YoY in July, while overall visit growth grew 25.4% YoY.

At the same time, Aldi has embarked on a massive US expansion.

• Last year, Aldi opened 109 new stores across the US, nearly as many as Publix, Sprouts, Grocery Outlet, H-E-B, and Whole Foods combined, per data from JLL.
• The discount grocer plans to open 800 more US stores by the end of 2028, with a focus on strengthening its presence in the Northeast and Midwest.

Why it matters: By enhancing the customer experience online and in-store, Aldi is better positioned to compete with other low-priced retailers like Walmart or Dollar General.

• Out-of-stocks are the top pain point when shopping in store, according to 39% of US adults, per February 2024 data from the Path to Purchase Institute in conjunction with Great Northern In-Store.
• The top three activities US shoppers conduct on their phones while shopping in-store are price checks/comparisons, looking up discounts/promos, and accessing or downloading digital coupons, according to a May 2024 survey from SPAR Group.

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