Online grocery delivery just got interesting. The news this week that Morrisons’ has renegotiated a way better deal with Ocado – no doubt an easier feat now that the Northern Grocer is in bed with the mighty Amazon – bodes well for consumers across the country.
Until now Morrisons’ has been somewhat hamstrung by being limited to deliveries in certain regions and in having to share profits on online deliveries with Ocado . The new deal, details of which emerged this week, will see Ocado offering Morrisons’ delivery all over the UK and Scotland, as well as forgoing any share of the profits.
It will also be developing better picking tools so that the full range – give or take – of Morrisons’ inventory will be available online to these shoppers.
Coupled with Morrisons’ deal to supply Amazon and the newly launched AmazonFresh and suddenly the grocer is back in the fight.
Of course, this has been a long-term strategy – and a last roll of the dice – for Morrisons’ as it seeks to sustain its business and then grow in face of extremely stiff competition from the likes of Tesco and Sainsbury’s .
However, could all this be for naught? The likelihood of Lidl and/or Aldi joining in the home delivery market in the UK in the coming months is once again going to shake up this market.
Many retailers who are trying to deliver to consumers are having to do so at a loss to keep it competitive: faced with the already cheaper and much more cheerful Lidl-like alternative on a doorstep near you could make the fight to save Morrisons’ start all over again. I hope I’m wrong: I like Morrisons.
Meanwhile, sports retailer Decathlon is widening its reach with a deal to use InPostUK’s 1100 secure lockers around the country for a more convenient take on click and collect. The move should open the doors to making Decathlon a much more capable online retailer giving shoppers the chance to at least collect things from a more convenient location than in the store.
What both these stories this week tell us is that ‘delivery’ of online purchased goods is becoming a real battleground. Consumers are embracing online retail, but as that takes off, so the need to get the goods to them is changing. Omni-channel retailers have a vested interest in keeping their stores going – and click and collect, as well as ‘picking’ helps justify this and keeps stores alive.
But is that really what consumers want? Since I am guest editing for Chloe Rigby while she’s on holiday (worry not she’s back next week), I am going to stick my mobile oar in here.
As I reported in my M-Retailing newsletter yesterday, pure-play online retailers are growing much faster than omni-channel ones: and the growth is coming from mobile. This is because they do mobile better and aren’t wasting their time with click and collect (among other things). What this shows is that, done correctly, mobile can obviate the need for click and collect and switch instead to a delivery model. Sure, lockers such as InPostUK’s will also be part of this, but going to a store? Really?
Chloe Rigby is away.
