For some urban commuters, the new city space offers a better experience than the older formats. Calvin Dozier, who usually shops at Aldi in Brooklyn, recently started visiting the Manhattan location right across the street from his office for convenience.
“This one here – it’s brighter,” Dozier told the BBC, looking at the fresh sweet navel oranges in his basket. “The one in Brooklyn is a little smaller. It almost feels temporary, but here it looks like a permanent place.”
Still, winning over urban slickers accustomed to premium brands remains an uphill battle. Ralph Montenegro, visiting Aldi for the first time, remained completely loyal to competitors.
Montenegro praised the prices of staple foods such as flour and fruit, saying, “It has more variety than Target,” though he added that he still prefers Trader Joe’s. He said Aldi’s heavy reliance on packaged, private-label processed foods was a deterrent compared to the natural organic options he preferred.
According to Dustin York, associate professor of communications at Maryville University, this strict reliance on limited, private labels is what keeps Aldi’s overheads low.
He says Aldi targets a lean, highly efficient model that offers about 80% of what a traditional big-box retailer offers, but at a much lower cost.
Still, York argues that it’s unlikely Aldi will take dramatic market share from Walmart, because the retail giant is so huge. “I call Walmart a battleship, and I call Aldi a type of submarine.”
But navigating those crowded waters can bring a different financial risk.
“Their biggest kryptonite is real estate costs,” warned York, pointing to the brutal Manhattan retail landscape, where the average asking rent is between $350 and $700 per square foot.
