As the brouhaha broke out last month over the return of Cuthbert to shelves across the Aldi network, my younger son declared that he wanted to mark his 16th birthday with a Colin the Caterpillar cake – “the real one”, he emphasised, “not the fake you used to get us from Asda”.

That being his second birthday in lockdown, I trekked off to the nearest M&S Foodhall to comply with this request, a kind of upmarket throwback to his days as a young boy. But then I started thinking: Colin copycats have been around for years; why has this latest iteration from Aldi stirred up such a fuss?

The conventional response from intellectual property experts is that of all the others – Sainsbury’s Wiggles, Bonnie and Clyde from Asda, Tesco’s Curly, Morris by Morrisons, and the Curious Caterpillar Cake from the Co-op – Cuthbert is the closest version to that of M&S’s Colin.

Perhaps, but there are certainly other factors at play as well. The #FreeCuthbert storm that erupted across social media was a resounding victory for Aldi’s marketing team, which is arguably among the most adept at generating this kind of publicity: while still jousting online over caterpillars in court, they were also taking a poke at Nike with the “Just Done It” campaign for Aldi’s new range of loungewear.

READ MORE: Tesco profits tumble despite pandemic sales surge

Since the financial crisis of 2008, hard discounters like Aldi and Lidl have been gaining market share at the expense of their more upmarket rivals, a trend that looks likely to continue as the repercussions from the pandemic work their way through the economy. And now, Covid safety measures have reconstructed the operating model for supermarkets.

Profit margins among the major food retailers are wafer-thin, typically somewhere in the region of 1-3 per cent. They make their money through large sales volumes.

The enforced closure of pubs and restaurants diverted consumer spending on food outside the home to consumption within, but this surge in sales has not translated into improved profitability. Pre-tax profits at Morrisons fell by half last year as it absorbed £290 million of pandemic costs. Tesco spent nearly £900m in the last financial year grappling with Covid, so its 7% increase in turnover translated into a 20% fall in profits. Sainsbury’s racked up £485m in Covid costs, cutting underlying profits by 39%.

Marks & Spencer, of course, has its large chain of department stores that have for the most part been closed for the last 13 months. With the group sinking to its first loss in 94 years during the six months to the end of September, it may feel under particular pressure to protect its food business.

READ MORE: Aldi announces return of Cuthbert the Caterpillar amid copyright row with M&S

The biggest extra expense supermarkets have had to deal with as a direct result of Covid has been staff costs, with tens of thousands of new workers hired to increase online capacity and cover for workers who have had to self-isolate. At the peak of the outbreak, 52,000 of Tesco’s staff were off work – nearly a sixth of its UK headcount.

Absenteeism has been falling since then and will presumably get back to normal, assuming the vaccination programme brings the virus under control. However, other costs linked to increased cleaning and the rise in e-commerce will persist.

The surge in the use of home delivery has changed the equation because this channel is less profitable than sales of higher-margin sandwiches and ready meals to commuters and office workers. Fees for online deliveries – typically £3 to £5 – do not usually cover the costs of picking up and delivering. If this remains a significant proportion of the sales mix in the months and years to come, delivery charges will have to increase, or supermarkets will have to find another way to recoup those costs.

As the economy continues to open up, consumers will have a much wider range of options on where to spend their time and money. Though difficult to say exactly how much of this last year’s sales boost has been down to a lack of competition, some of that discretionary spending on non-staple food items will inevitably go elsewhere.

Cuthbert is expected to make his comeback some time later this month, but with court challenges pending, there is further to go as the cake drama plays out. Similarly, it remains to be seen how the supermarkets fare with the return of their “non-essential” rivals.