EU roundup: Private label, retail media and store expansion

In this instalment, our analysts for Europe offer their take on some of the region’s latest developments and initiatives. Here’s what you need to know about:

•  Kaufland expanding Lidl range

• Mercadona hit new Portuguese milestone

• Żabka redefine omni-channel retail media in Poland

• Billa open ‘delivery store’

Kaufland to boost non-food offering with Lidl brands 

The Schwarz Group is integrating its non‑food business by rolling Lidl’s private‑label brands such as Crivit, Silvercrest, Livarno, Esmara and Lupilu into Kaufland, replacing several Kaufland‑specific labels. The move aims to reduce label fragmentation, boost brand visibility across both banners, and make these ranges permanently available with added promotional activity.

Insight Analyst, Dan Butler‘s view: this is a smart simplification strategy that concentrates marketing spend and scale behind fewer, stronger private labels, improving shopper recognition and efficiency across Europe. It also builds on the proven success of the Parkside DIY brand, which has already driven strong demand since being listed in Kaufland stores. For suppliers already producing for Lidl brands, this creates higher volumes, wider distribution and more stable demand signals.

Mercadona achieves new milestone in Portugal

Spanish market leader Mercadona, launched its first store in Portugal in 2019. The retailer has now launched its 71^st store in Viseu. The store is 1,900sq m and features Mercadona’s self-service ready to eat section, along its standard categories. A standout initiative includes its 422 solar panels, helping to reduce its annual electricity consumption. The retailer is focused on reducing cost to maximise profits to reinvest into improving purchasing power and its private label portfolio.

Senior Insight Analyst, Lucy Beaumont’s view: Mercadona has made an impressive entry into the Portuguese market since 2019 and doesn’t show any sign of slowing down soon. Mercadona is expected to open a further 12 stores, with an investment of €150m and estimates profits of around €50m in 2026. Mercadona shows its determination to reinforce its presence in the market. Mercadona remains a retailer to watch in both the Spanish and Portuguese market, demonstrating excellent store formats to sustain growth and improve efficiency, see our latest store visit in Valencia.

Żabka’s market-first off-site retail media move

Żabka has partnered with location data specialist Proxi.cloud to launch Poland’s first fully omnichannel retail media offering. Through Żabka Ads Offsite, brands can now activate campaigns beyond Żabka stores, using anonymous first‑party data from the Żappka app to target shoppers across digital channels and measure impact on in‑store sales.  With over 10 million Żappka users, Żabka Ads now offers reach comparable to Poland’s largest digital publishers and extends retail media capabilities beyond categories sold in‑store.

Insight Analyst, Bently Briggs’s view: This marks a significant shift for the Polish retail and media landscape. By becoming the first retailer in Poland with a true end‑to‑end omnichannel retail media proposition, Żabka is redefining how brands can connect digital investment to physical sales outcomes. This move is likely to accelerate retail media adoption across the market and put pressure on other retailers to develop similar capabilities.

Get some deeper insights into Żabka and the Polish market with our country presentation.

Billa expands partnership with Foodora

Following the announcement that it would be closing its in-house online offering, the REWE Group’s supermarket banner in Austria has opened a “delivery store” in partnership with the quick commerce provider. The first of its kind for Billa, it allows shoppers across most of Vienna to receive orders in 60 minutes until 10pm from Monday to Saturday.

Senior Insight Analyst, Michela Pearson’s view: Profitability in the online channel is difficult to achieve, and this is not the first time that the REWE Group has stepped back from the space; it closed its online shop for discount banner Penny in Germany last year. Partnering with quick-commerce providers allows them to use the existing infrastructure with less investment. In Austria, the online channel will continue to grow as shoppers seek increased convenience, but brick-and-mortar offerings will continue to dominate in the long term.

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