Lidl takes on London’s wealthiest areas

Discount retailer Lidl is eyeing up expansion into London’s most affluent neighbourhoods as it continues to tempt in savvy buyers with good value wine and spirits.

Lidl has been winning over – and retaining – wealthier customers, according to analysts (Photo: Wiki)

The German supermarket has reportedly been sending brochures to property agents in Notting Hill, Mayfair, Kensington and Chelsea – the areas with the highest house prices in the UK – with the intention of finding available retail units for sale.

Richard Taylor, Lidl UK’s property director, told the Financial Times: “As we continue with our ambitious store expansion programme across the UK we’re seeing strong demand, particularly within the Greater London area.”

Lidl’s intention to expand into areas traditionally considered too wealthy for discount retailers comes as analysts report on its growing ability to both retain deal-hunting customers from the financial crash of 2008, and new customers regardless of their net-worth.

“People on very low incomes found the discounters many years ago,” Clive Black, an analyst at Shore Capital, told the FT.

“Through necessity there was a much broader customer base who tried out the discounters when they were really on the ropes. One of the significant things is they have stuck,” he said.

Lidl’s diverse retail lines, such as its constantly evolving fine wine offering, have helped with this retention of new, wealthy customers attracted by sub-£10 Champagne, own-brand liqueurs, and its points-based wine list assembled by Richard Bampfield MW.

At the end of July, the retailer announced it was preparing to put 60 new wines on sale and putting on six “Wine Cellar” promotions over 2016.

Lidl revealed a 38% growth in wine sales over the 12 months to July, representing an additional £60 million worth of business, taking its share of the market to a little over £200m. This means it now accounts for roughly 4% of the £5bn UK off-trade wine sector.