Food and Drink Internet Retailing in the Netherlands

PROSPECTS

Food and drink remains one of the fastest-growing categories in internet retailing

Food and drink internet retailing remained among the fastest-growing categories in internet retailing in 2018, and built further on the rapid expansion witnessed in 2016 and 2017. Sales were mainly driven by grocery retailing, where sales increased following the entry of Picnic.

Four in 10 households buy groceries online

Overall, the Netherlands appears well positioned to become one of the most dynamic online grocery markets in Europe. Nearly 80% of national households made at least one online purchase in the past year, putting Dutch consumers in a top group among European consumers in terms of their likelihood to buy online.

High outlet density and advanced urbanisation pose structural challenges

The fact that, despite such favourable conditions, online grocery retailing in the Netherlands remains underdeveloped compared to the UK points to deeper structural challenges. One frequently mentioned factor is the relatively high outlet density in the country.

COMPETITIVE LANDSCAPE

Rapid expansion of newcomer Picnic in 2015 revitalise its category

Picnic is a domestic online grocery retailer that launched in September 2015 and is commonly referred to both in the trade and general press as an “online supermarket”. Its product assortment aligns closely with those of other modern grocery retailers in the Netherlands, with food as well as various types of non-food products.

Ah.nl and Jumbo still the two leading players

Ah.nl, the online division of grocery chain Albert Heijn, itself a subsidiary of Ahold Delhaize, remained the leader in online grocery retailing.

Internet retailing mostly one part of a multi-channel strategy

Unlike Picnic, Albert Heijn and Jumbo Supermarkten do not operate their online divisions primarily with a view of turning a profit via online sales, but rather see the online channel as another opportunity for ensuring customer loyalty through proximity. To this effect, Albert Heijn and Jumbo Supermarkten pursue comprehensive strategies that include opening new convenience stores in high-traffic city centres and railway stations; experimenting with new store formats that blur the traditional boundaries between grocery retail and foodservice to tap into the lucrative foodservice channel; investing in collection points, which are also popular with institutional customers; as well as improving its home delivery service.

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