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From Amazon to Ocado: how retailers are responding to customers who now appear more willing to buy online

Image courtesy of Ocado

In today’s InternetRetailing newsletter, we report as retailers and brands continue to respond to the ever-changing way in which shoppers now want to buy. We’re seeing customers become more willing to buy online at all, and then to buy more frequently and to buy more expensive items than before. That’s likely to be a direct result of Covid-19 lockdowns, when people got more comfortable with using digital channels both for work and for shopping. Retailers and brands are responding accordingly. 

Today we’re reporting as Amazon gives luxury brands a new route to market. Oscar de la Renta will be the first to sell via its Luxury Stores feature. One interesting point about this is that  brands can now retain full control of their business and their data when selling via a marketplace, while using Amazon merchandising technologies to present their wares. We’ll watch with interest to see how this works in practice and whether it expands beyond its initial base, selling to selected Amazon Prime US members. If it succeeds, it will be because customers are now willing, in a way they weren’t in years gone by, to spend large amounts of money on items they have not been able to see for themselves. Certainly some luxury retailers, including Watches of Switzerland, have shown us that shoppers more were willing than ever to buy luxury goods online during lockdown.

We also report as Ocado’s tie-up with M&S goes down well with shoppers. The first day that M&S goods were available for delivery via Ocado was the biggest single forward order day in the online grocer’s history. Now, says Ocado, 98% of baskets contain at least one M&S product. But M&S was not the reason why Ocado’s retail revenues rose by 52% in its third quarter. Ocado sees, rather, a distinct shift, as customers become more willing to buy online. 

That’s also being seen by Aldi, which is now responding by trialling a click-and-collect service for the first time in the UK. Lockdown, it seems, made a much stronger case for ecommerce than simple convenience ever did. 

Meanwhile, ScS is expanding its workforce both online and in-store in response to high levels of post-lockdown demand. 

And the latest footfall figures suggest that shoppers will continue to work from home for at least the near future, and will likely opt to buy more online as a result. Springboard is finding that now the summer holidays are over and children are back at school, their parents are not heading to the shops in a way that’s reflected in store visitor numbers, with footfall falling last week compared to the previous week, and still down by more than a quarter on the same time last year. 

In today’s guest comment, Ken Fleming of Logistyx Technologies considers how retailers can make their supply chains more resilient to the next disruption.

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