Lidl customers in Northern Ireland, rejoice! You’ll soon be able to enjoy a well-earned beer for diligently doing your grocery shopping. After a multi-year legal tussle, which included application rejections and complaints from local off-licence owners, Lidl was finally given the green light to open a pub in its Dundonald store.
True, the UK might not need another new pub. And many will question how the discount supermarket chain was able to sway the court, considering the tough-as-nails alcohol licensing laws in the country. For instance, the rules state that any new publicans must prove there are inadequate licensed premises near their prospective site – that is, there are not enough pubs in the area. Plus, no new alcohol-sale licences can be granted unless another one is surrendered.
When it comes to loyalty, simplicity pays
There were plenty of challenges to the pub’s opening. Nearby convenience stores voiced strong objections. But, legal arguments aside, Lidl used the strength of its brand to reach an agreement with local bar owners to surrender their licences, thereby enabling Lidl to gain approval for the pub. Lidl also coughed up some cash – loads of it. The retailer committed to investing around £400,000 to fully outfit the store, which will include a taproom.
Why is Lidl making this move now? In this day and age, any pundit could build a bullet-proof business case against the ROI of pubs. But for Lidl the initiative is less about the business model and more about the experience it provides for customers – and the case for enhanced customer experience is much simpler to make.
Creating a cult following
In the UK, the pub is a cultural institution. It’s a gathering place for locals. It’s where you go to socialise on quiz nights. It’s where you watch football with your mates on a Saturday afternoon.
And yet, it was a German retailer that had the foresight to seize this opportunity. By integrating a pub into its store, Lidl is moving beyond just being a supermarket – it is positioning itself as a community destination; a place to unwind before or after grocery shopping, to mingle or simply to kill time.
As always, customers will determine whether the move be a success. But the initiative shows Lidl’s willingness to experiment with new formats and proves its understanding of local customs. Lidl is using the power of its brand – and its customers’ understanding of that brand – to shift the perception of supermarkets from purely transactional spaces to experiential ones.
This could boost foot traffic, giving customers a reason to spend more time and money at Lidl, or to drop in more frequently. It also strengthens an emotional bond with the community. It not only reinforces Lidl’s emphasis on customer loyalty but also helps the brand attract new customers. The retailer was already excelling in this regard: in 2024, the retailer gained 326,000 additional shoppers – more than any other supermarket in the UK.
Kings of simplicity
Part of Lidl’s success is down to the simplicity of the brand.
Lidl recently secured the top spot in Siegel+Gale’s World’s Simplest Brands index, which aims to identify the brands and industries that best simplify people’s lives. Lidl outperformed tech and consumer-goods giants by deploying five simple strategies that make customers’ lives easier. One of these is the “ability to harness the power of its customer base, recognising that its customers are not just consumers but potential brand advocates”.
The tagline conjures the idea of value, without even using the word
Even Lidl’s tagline is supremely simple – ‘Big on quality, Lidl on price’. It sticks in the minds of budget-conscious customers who are focused on value for money and wish to limit unnecessary purchases. Most importantly, the tagline conjures the idea of value, without even using the word.
Lidl’s clear and compelling brand proposition helps to foster loyalty and trust with their customers. The retailer turns satisfied shoppers into genuine ambassadors who promote the brand organically to friends and family. This loyalty results in more revenue and creates a virtuous cycle where all parties walk away feeling they’ve made a good deal.
People don’t want to be perceived as stingy; they’d rather be seen as discerning, especially in today’s economy. Lidl’s focus on providing value for money through operational efficiency and a strong private-label offering is therefore central to its success as a discount brand. Their approach helps to create a sense of excitement for shoppers, who feel as thought they’re “winning” at the tills. As a customer, that feels good.
For proof of the wisdom of its strategy, look no further than Lidl’s performance over the festive period in 2024, when its turnover surpassed £1bn. How did the company manage this? According to a study by Kantar, the success was fuelled by existing customers, who made an additional 35 million shopping trips to Lidl stores compared with the previous year, and purchased 267 million more items.
When it comes to loyalty, simplicity pays.
Setting new standards
Lidl’s pub initiative is a bold move that goes beyond just selling products – it taps into community-building and innovation. It enhances the retailer’s reputation as a confident, forward-thinking brand that understands what its customers expect: a simplified shopping experience that aligns with local customs and is truly big on quality and little on price.
So watch this space. It might just set a precedent for how supermarkets evolve to blend shopping with social engagement, one pint at a time.
Patrick Kampff is senior strategy director at Siegel+Gale, a consulting and design agency
Lidl customers in Northern Ireland, rejoice! You’ll soon be able to enjoy a well-earned beer for diligently doing your grocery shopping. After a multi-year legal tussle, which included application rejections and complaints from local off-licence owners, Lidl was finally given the green light to open a pub in its Dundonald store.
True, the UK might not need another new pub. And many will question how the discount supermarket chain was able to sway the court, considering the tough-as-nails alcohol licensing laws in the country. For instance, the rules state that any new publicans must prove there are inadequate licensed premises near their prospective site – that is, there are not enough pubs in the area. Plus, no new alcohol-sale licences can be granted unless another one is surrendered.
When it comes to loyalty, simplicity pays
