In today’s InternetRetailing newsletter we are reporting on how major retailers across the grocery and FMCG sectors are continuing to have to adapt their retail processes as lockdown rules and consumer habits continue to evolve.
The grocery sector is showing a mixed bag of results, with in-store sales still growing, but at a slowing pace, while online is booming – up 117% across the 19 weeks to the end of August.
Much of this grocery growth is being driven not by the big four, but by their competitors. Morrisons has seen the biggest growth of the major supermarkets, while Ocado has trumped all with the most sustain growth and the biggest increase in market share.
None of this has been lost on Amazon, which continues to ramp-up its grocery delivery business in the UK – posing enough of a threat that Tesco is now looking to waive delivery fees for its Clubcard Plus members to make its service that bit more enticing.
But is that enough? Part of the problem for the big supermarkets is that as more shoppers move online to buy their food, the battle to get hold of delivery slots is forcing many to look to alternatives to Tesco, Sainsbury’s and Asda.
This is why Amazon and Ocado pose such a threat to the traditional supermarkets. For now they can mop up all that excess demand. However, if they offer a really good service then customers stick with them.
Meanwhile, these same changing shopping habits are forcing other retailers from within both grocery and non-food to adapt. M&S – which straddles both – is shedding more jobs from its shopfloor and head office workforces, while pledging to create new jobs in its online and fulfilment operations.
This, part of its ‘Never the same again’ restructuring plan, finds the retailer having to adapt at break-neck speed to these changing habits and instigate a whole new way of operating. Tough right now, but probably right long term as things have changed for good.
Selfridges too is adapting, ushering in online rentals and in-store repairs as it transforms the way that it sells, and that its customers shop.
Together, these paint a clearer picture of what retail is going to look like in the coming months as we start to adapt to a new season and new challenges.
