During my visit to Spain to attend a major retail and consumer goods trade show in Madrid, I met with several industry experts to discuss how grocery consumption is evolving across the country. What stood out immediately in conversations with analysts and former executives was a consistent theme: demand for food retail is still rising, but the battle for market share among supermarkets has never been more intense.
Spain’s grocery sector continues to expand, driven by population density in urban areas, tourism-related demand, and a steady shift toward more frequent, smaller shopping trips. At the same time, major supermarket chains are accelerating expansion strategies, opening new stores and modernising formats in an effort to capture changing consumer habits.
Discount retailers such as Aldi and Lidl continue to strengthen their presence in Spain, but their growth is increasingly being met with stronger resistance from domestic competitors. One of the most interesting dynamics discussed at the event was the positioning of DIA, which many analysts describe as operating with a “hybrid discount model” that closely mirrors aspects of both international discounters and traditional Spanish convenience grocery formats.
To explore these trends further, I spoke with two specialists: Dr. Elena Martín, a Spanish consumer behaviour analyst specialising in retail psychology and food purchasing trends, and Carlos Vega, a former financial manager at Mercadona with extensive experience in store expansion strategy and operational finance.
Interview
Riad Beladi: From what I’ve observed here at the trade show, grocery consumption in Spain seems to be increasing again, but in a different way than before. What is driving this shift?
Dr. Elena Martín: You are right to notice that. We are not necessarily seeing people buying dramatically more food overall, but we are seeing more frequent consumption cycles. Households are shopping smaller baskets more often. This is driven by urban living patterns, flexible working, and also a stronger focus on freshness. People prefer to buy what they need for two or three days rather than a full week.
Riad Beladi: Supermarkets seem to be expanding aggressively again. New stores, new formats—what is behind this acceleration?
Carlos Vega: Expansion is very strategic right now. In Spain, store proximity is becoming a key competitive advantage. Even large players like Mercadona, Carrefour, and regional chains are investing in density rather than just size. The logic is simple: if you are closer to the customer, you win frequency.
Riad Beladi: And how does competition from Aldi and Lidl fit into this picture?
Dr. Elena Martín: Aldi and Lidl have fundamentally changed price expectations in Spain. Even consumers who do not shop there regularly benchmark prices against them. However, what is interesting is that Spanish retailers have adapted quickly. They have improved private label quality and adjusted pricing architecture. The gap has narrowed significantly.
Riad Beladi: Some analysts say DIA operates in a similar space to discounters but with a Spanish adaptation. Do you agree?
Carlos Vega: DIA is an interesting case. It is not a pure discounter like Lidl, nor a full-service supermarket like Mercadona. It sits in the middle, which can be both an advantage and a challenge. In financial terms, that means balancing low-price perception with operational efficiency. It’s a difficult model but very relevant in smaller urban locations.
Riad Beladi: From a broader perspective, do you think grocery consumption in Spain will continue to grow?
Dr. Elena Martín: Yes, but modestly. The growth is not explosive; it is structural. Population movement into cities, tourism recovery, and health-conscious eating habits all support steady growth. The real competition is not about whether people buy more food, but where they choose to buy it.
Riad Beladi: Finally, what should we expect from supermarkets over the next few years?
Carlos Vega: More automation, more convenience formats, and more aggressive store expansion in dense urban areas. But also more pressure on margins. Retailers will need to be extremely efficient while still investing in experience and convenience.
What became clear from these conversations is that Spain’s grocery market is no longer defined simply by price or scale, but by speed, proximity, and adaptability. As competition intensifies between traditional supermarkets and discount chains, the next phase of growth will be determined not only by expansion, but by how effectively retailers respond to rapidly changing consumer behaviour.