Election 2015 England

Election 2015: Can the 'Lidl class' be swayed by political promises?

Supermarket aisle
Image caption How people shop has changed since the time of the last general election in 2010, experts say

Since the last general election, savvy shoppers across England have turned to discount supermarkets to combat the effects of food prices rising faster than incomes. Can the so-called Lidl class be won over by anything politicians have to say this time around?

"Spend a little. Live a lot," Aldi says. Its rival speaks of "#Lidlsurprises".

Over the past few years, the two retailers have experienced record growth and increased their share of the British retail market. They increasingly lure middle-class shoppers through their doors with reasonably-priced luxury products and special offers.

Meanwhile, real pay for UK workers has not risen since 2007, according to an economic forecaster.

Isabelle Szmigin, Professor of Marketing at the University of Birmingham, said she believed 2010 was a "tipping point" in terms of how people's shopping habits changed.

"We were at a crisis point. It was two years on from the financial disaster, we were entering into a time of high fuel prices and increases in VAT.

"People started noticing prices more, noticing their shopping was getting more expensive. It was crunch time," she said.

Image copyright AFP/Getty
Image caption Aldi has more than 500 stores in the UK and Ireland and plans to open more

"They thought, 'if I can buy an own-label brand at a much cheaper price, I will'. Britain is no longer a country of convenience shoppers, we're much more savvy and prepared to move from shop to shop."

She believes economic decisions made by politicians around wages, taxes and benefits have a significant impact on families, particularly those who earn less.

"Lower income families spend a larger proportion of their household budget on food. These are the people who feel food inflation, deflation, or stability more than others," Prof Szmigin said.

The discount revolution

  • Aldi opened its first shop in the UK in 1990, with rival Lidl's first British shop welcoming customers in 1994
  • At the time of the last general election in May 2010, Aldi and Lidl's combined share of the market stood at 4.9% - it is now 9%
  • "Aldi has recorded double-digit sales growth for the past four years and is now Britain's sixth largest supermarket with 5.3% of the market," said Fraser McKevitt from consumer insight company Kantar Worldpanel
Supermarket Market share (12 weeks to 29 March)
Tesco 28.4%
Asda 17.1%
Sainsbury's 16.4%
Morrisons 10.9%
The Co-operative 6.0%
Aldi 5.3%
Waitrose 5.1%
Lidl 3.7%
Iceland 2.1%

Source: Kantar Worldpanel

Prof Szmigin said she believed politicians had to "realise people will look at what they're offering in terms of saving money and spending money".

"That's how households will look at manifestos and promises - 'what does it mean for my budget?' but against a backdrop of knowing what they can and can't do something about in terms of their finances," she said.

"You have to think, what can any of the parties do about how much we spend on food, other than cutting tax on it, or ensuring we have more money in our net income?

"People want to see how much money they get or lose, then choose how to spend it."

Image caption Shoppers Donna Kemp and Elizabeth Cowley-Leng said they could not be swayed by politicians

What about the discount shoppers themselves? Are they listening to what politicians have to say?

Donna Kemp, 54, has been shopping at discount stores for six or seven years.

"I know a lot of people who wouldn't have gone to Aldi or Lidl years ago now choose to go to those supermarkets, and probably shop around," she said.

She said she would not be influenced by Labour's promise to up the minimum wage, or the Conservatives' pledge not to raise VAT, National Insurance contributions or Income Tax.

Her views are shared by fellow shopper Elizabeth Cowley-Leng, 59, who said she was "fairly cynical" about politicians.

"The parties' proposals on freezing bills or putting up the minimum wage all sound great, but how are they deliver it all and still safeguard the NHS?"

Image caption Alex Ward, Alisha Lewis and Shirley Lovesey-Preston were interested in different issues

Alex Ward said he was fortunate not to have been hit hard by the recession, but was drawn to discount supermarkets because of the savings to be made.

"None of the parties' policies around putting money in people's pockets appeal to me," he said.

"Until somebody comes out and really gives me something alternative, I'm dubious about which way my vote will go."

Alisha Lewis, 33, said she had not decided who to vote for but was attracted by the Liberal Democrats' policy on extending free childcare.

"Childcare costs are huge so anything that can help out with those is good. But the Conservatives have said the same thing. Anything that helps with that side of things, I'll take notice of that."

Shirley Lovesey-Preston, 61, said she was in favour of a freeze on VAT. "20% doesn't seem like it should be that different but it is. It'd be nice for it not to go up for a while."

But she is not planning on voting because "all they do is argue the toss with each other, and that turns me off."

Image caption Discount stores have seen a large increase in their profit share over the last few years

When it comes to shopping at discount stores, food is not the only market to have seen an increase in profits since 2010.

Earlier this year, Poundland reported a 12% increase in half-year profits to £9.3m

David Haycox, operations controller at East of England-based QD stores, said hunting down bargains and saving money had become a "badge of honour".

"Saving money is fashionable," he said. "People will express publicly that they look out for cheap deals and save money."

He has also witnessed an "eclectic mix" of cars in his stores car parks in recent years - "a £100,000 Range Rover next to an old banger".

The QD Stores group has 47 shops across the East, selling home and garden items costing "anything from 10p to £4,000".

Mr Haycox would not reveal details of the company's increase in turnover but said the stores fitted "very comfortably" with current shopping habits.

Image caption QD Stores sells "anything from 10p to £4,000" in its stores across the East of England

But he does not think shoppers will be easily swayed about politicians' promises on the economy and the cost of living,

"I fear politicians aren't trusted and people will draw their own conclusions based on their personal circumstances, which dictate what's important to you and what you spend your money on.

Ratula Chakraborty, a senior lecturer in Business Management at the University of East Anglia, is inclined to disagree.

"People will always listen to what politicians say about money. Even if people are making do with what they have, they'd rather have some more.

"If there's money in your pocket, life will improve," she said.

Image caption Operators of discount stores have been warned not to "take their customers for granted"

Ms Chakraborty, who has been looking into the discount trend which has emerged since 2010, said there had been a shift in people's mindsets in recent times as they "cottoned on to the fact the economy is doing slightly better".

"Take, for example, the downward trend in fuel prices. That's money we spend where we really feel the difference. You feel the cash in your hand."

But she does not think the discount bubble will burst any time soon, and warned discount stores not to take their customers for granted.

"They have to be careful in their expansion that the middle class and and upper middle class will come to do their shopping and stay satisfied," she said.

"We're promiscuous as consumers. Discounters will have to be careful and play the game as well as they're playing it right now."

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