Europe’s driving change
Online grocery retailing is one of the hottest topics in food. Want clues on how it will grow in Canada? Look across the pond
There is no doubt: online grocery retailing is on the move in Canada. The launch of Walmart’s online service in Ottawa, and the expansion of Loblaw’s click-and-collect program, show demand is growing. So, what trends are taking form in the more mature e-commerce markets in Europe? Here are four developments Canadian grocers should pay attention to.
1. A DEMAND FOR INSTANT. One of the big trends in Europe is the growing demand for “instant” delivery. Consumers want faster and more convenient ways to shop. As a result, delivery expectations are on the rise. In Spain, two companies are making their mark in this area.
First, Ulabox, an online supermarket business, saw its sales double last year, with much of the growth driven by its ability to deliver orders in less than two hours. And second, replicating the success that Instacart has had in the U.S., Valencia-based Comprea plans to expand its presence across the country.
2. COMPLETE MEAL SOLUTIONS. Staying with the convenience theme, many shoppers are looking online for complete meal solutions to take the hassle out of preparing their own fresh meals. Sales of meal solutions in Europe are on the rise, especially among working parents, single households and the elderly living alone.
Godt Levert in Norway is providing fresh ingredients and recipes to consumers’ doors once they’ve placed an online order. Celebrity chef Ole Martin Alfsen, who builds the recipes and assembles the weekly menu, endorses the company.
3. INNOVATION IN ORDER FULFILMENT.
As in Canada, click and collect is becoming more popular with shoppers. This is encouraging retailers to be flexible with their locations and to provide shoppers with the most convenient pickup or delivery solutions.
One of the most innovative developments in the United Kingdom is Asda-Walmart’s fully automated click- and-collect locations. Once a customer drives into the unmanned pod and types in his code, robotic arms grab the order from crates stored in three different temperature zones.
Orders are ready less than one minute after a customer arrives; the robots bring them to a designated hatch to be loaded into the car. Not only does the concept offer 24/7 pickup, but same-day orders can also be fulfilled.
4. PARTNER FOR SPEED. While unmanned pods may be at the leading edge, there are still a large number of retailers yet to get into the online channel. But for those that want to build scale quickly, striking a partnership with an existing operator can be a quick way to leapfrog the competition.
The U.K.’s fourth-largest grocery chain, Morrisons, was a relative latecomer to e-commerce. But rather than invest in its own platform, it partnered with Ocado, an established operator in the online home delivery service that has been looking to commercialize its technology. Likewise, top Swiss retailer Migros partnered with Amazon to launch its private brands into Germany. (This demonstrates how much easier it is for retailers to cross national boundaries without establishing a physical store presence.)
So, if you’re hunting for clues about how online grocery will develop in Canada, look across the pond to Europe. Expect to see click and collect roll out to new parts of our country. Expect other retailers to come into the channel. And expect operators to differentiate themselves through unique service and new ways of delivering.