Aldi engages in shuttle diplomacy with college kids

Discussion
Mar 10, 2015

What’s a college kid to do when she/he needs some groceries and the nearest store is beyond walking distance, especially on the return path when loaded down with purchases?

Many can go with the old standby of having a friend on campus who owns a car provide transportation. Beyond that, others can order online and have a delivery come straight to their dorm. Another option, being tried at colleges in Ireland, is simply hopping on a shuttle bus and heading to Aldi.

According to reports, Aldi first began offering s free bus shuttle to students at the at Institute of Technology Sligo in 2014. The service proved so popular, the limited assortment discount chain expanded it to additional campuses in the Republic of Ireland this year — University College Dublin, Trinity, Limerick and Dublin City University. Aldi will add another shuttle at Dundalk Institute of Technology this week and plans to expand the service to every college campus in the Republic.

The shuttle service at each of the campuses offers two weekly runs to the stores.

"[Aldi] sees students as an important demographic and to that end it decided to look at helping them with their weekly shop by putting on a bus service that brings them to and from their nearest store," an unidentified Aldi spokesperson told the Sunday Times.

How big is the opportunity for retailers, particularly grocery stores, to serve students residing on and near college campuses? What do you think of Aldi’s free bus shuttle service idea?

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16 Comments on "Aldi engages in shuttle diplomacy with college kids"

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Dr. Stephen Needel
BrainTrust

Love the idea, assuming it is close to break-even for Aldi cost-wise. What a great way to build customer loyalty—these students will grow up thinking well of Aldi.

Kelly Tackett
BrainTrust

It’s a huge opportunity to gain early access to impressionable customers in a highly sought-after demographic. Although they may now be bankrolled by mom and dad, when they enter the “real world” they will likely retain loyalty to those retailers with whom they’ve built an authentic relationship over their formative years as a consumer. The investment in a shuttle bus seems a relatively small price for customer acquisition and retention. Indeed, I would argue that retailers in the U.S. should use shuttles or the like to further improve accessibility for consumers residing in food deserts.

Joan Treistman
BrainTrust

As soon as I read that Aldi offered “two weekly runs to the store” a red flag went up. The logistics for a large campus with thousands of students could be a huge barrier, not to mention insurance costs (on small or large campuses) etc.

Students without cars surely have cabin/campus fever from time to time. Getting groceries in the store can be a remedy, or at least I thought so when my children were infants. If that interest is there I see a good opportunity for an independent bus service to offer a comprehensive schedule from campus to several retailers on a daily basis. In the States I’m not convinced a shuttle to a single retailer is a winning strategy.

Max Goldberg
BrainTrust

I think Aldi’s campus-to-store shuttle makes great sense. Aldi is a low-cost retailer and students tend to be budget conscious. I’m sure Aldi has run the numbers and found a significant net gain from providing transportation. There’s no reason why a similar service could not work in college towns across the U.S. My son, living in Boulder, CO and regularly complaining about difficulties getting groceries, would immediately take advantage of it.

Ken Lonyai
BrainTrust

This is a great idea for Aldi as long as it’s cost effective. Given that they are expanding to the whole country, presumably it is. In its most basic requirement, user experience is centered on effectively satisfying user expectations, but it really becomes a powerful tool by exceeding them. In this case, the convenience of moving students between campus and store does more than provide food and sundries, it creates added conveniences, beyond product selection and price. Plus, the goodwill has great potential to establish the brand in the minds of students for when they leave college.

I’d be surprised if this hasn’t been done in some fashion somewhere else, nevertheless, it’s an idea with legs that grocery and other categories can effectively roll-out.

Mark Heckman
BrainTrust

As a former retailer who marketed to the college crowd, my experience tells me that unless Aldi takes a very comprehensive approach to student marketing, they will see their efforts fall short of their expectations.

Many food retailers that have stores near college campuses provide buses, student discounts and back to school-type items from time-to-time during the school year. Aldi’s “standing” bus service is a good idea that deserves its day in the sun and should work provided that Aldi consider and offer the mix of products that students consume. My last visit to an Aldi would lead me to believe that the retailer has some work to do in the way of understanding which items and quantities they need to offer.

I also believe that they will need to refine both the quantity and timing of the bus trips. Students do not lead disciplined lives, consequently Aldi will likely find that unless the bus trips are well publicized and supplemented with discount offers and other incentives, the buses will not be full.

David Livingston
Guest
2 years 7 months ago

One key to success is to look at the percentage of students without car. I’ve seen it as high as 40 percent and as low as 10 percent. The higher the percentage without cars the better. A high percentage of students residing in their own apartments is a good sign versus living in dorms. And of course competition. The further away the grocery stores the better. The shuttle bus might work in Ireland but in the U.S. it would be more of a novelty. Many stores already have this as a courtesy rather than necessity.

Marc Millstein
Guest
Marc Millstein
2 years 7 months ago

This is a terrific example of feet-on-the-ground customer service and engagement to a targeted, well defined market. I love it. Simple, clear—and effective? The key is how much business the service drives and determining incremental profits, if any. I am sure it is a very good marketing and broadening tool also. But I think this type of service needs to be a money maker as well. To the extent it actually drives the business, the potential is significant.

W. Frank Dell II
BrainTrust

This is a good match between a limited-item store and limited-purchasing customers. This idea has been in practice for years in Florida, where a shuttle bus brings senior citizens to their store. Factors that would be important are the frequency of trips and the distance to the store. An hour ride would not be appealing. Depending on the location, partnering with other retailers to expand the service may increase the shoppers’ convenience.

Roger Saunders
BrainTrust

The retailer currently making the most successful and biggest use of a “shuttle bus” is Amazon. Based on the Prosper Monthly Consumer Survey, 14.2 percent of the 18-24 year old set chose Amazon for the largest portion of their back-to-school shopping.

However, that should not dissuade retailers like Target, Meijer, Walmart or mall centers near college campuses from testing and then employing this useful technique. Easy enough to test this model on larger campuses that have these types of brick-and-mortar operations that are three to seven miles away from a major university.

Wrapping a bus on a Saturday/Sunday with a “Badger bus to … ” or “State stock up savings at …” banner and having the bus offer free transportation and a bonus for riding, e.g., $5 movie tickets, drinks are on us with lunch, etc., lets the students know that they are welcome and merchants have the goods to get them to and from campus.

Li McClelland
Guest
Li McClelland
2 years 7 months ago

My sense is that this will work very well on some campuses and with some campus communities, and not so well at all in other places. The trip to the Aldi store, for instance, cannot be so far that it seems to students that the shuttle wastes too much valuable time, or on a big campus if it stops along the way at too many places on campus to be efficient. I love that Aldi is trying this, but hope for their bottom line that they don’t feel compelled to keep the shuttle service operations going on any campuses that seem resistant instead of all-in.

Lee Kent
BrainTrust

This is a great idea and a great opportunity assuming college students buy more groceries than we did when I was in college.

In my day we were armed only with a popcorn popper. You were told to buy the kind where the bowl of the popper was separate from the coils. That way, you could buy Ramen noodles and heat them in the bowl part. Have I sufficiently dated myself now?

But, we still had to get to the grocery store, and of course they sold Boone’s Farm strawberry wine for 85 cents at the grocery stores in NC.

Kudos and my two cents to Aldi!

Gajendra Ratnavel
BrainTrust

Love it! This would have been really useful for my university days. More importantly, using my bank as an example, you build strong loyalty during that time of your life. Banks have been doing this for a while now. Having branches right on campus.

Craig Sundstrom
Guest

Startling that this should come from frill-free Aldi, which IIRC charges (a deposit) for shopping carts. And “college-educated” isn’t a demographic I would think they would be chasing … though maybe college (loan)-impoverished is.

Many of the respondents here said they “love(d) it,” but that seems more of an emotional response than a business one, which—as David notes—is a numbers issue. Are there enough car-free students concentrated in a given area to make it work? Like him, I think this may be one of those ideas which works better somewhere else than it would here in the U.S. Indeed, I wonder if students are really much different than other carless, low-income groups…which Aldi presumably isn’t willing to shuttle around.

gordon arnold
Guest

No credit services, extra $ for bags, and no off-campus shuttle services will limit the order sizes severely. They might have considered the over 55 living community condominiums instead with on board bingo for coupons for the winners. Oh I forgot—they don’t do coupons. Well that’s something they might consider too.

Kate Blake
Guest
Kate Blake
2 years 7 months ago

This is such a great idea! They do the same thing in retirement communities, providing a shuttle once a week to do shopping!

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