Internet retailing for grocery products remains underdeveloped compared to other categories less impacted by the challenges linked to selling food and drinks online. However, large grocery retailers have made strong gains in some markets, with the rise of drive-through units in France and home delivery in the UK. This report examines the performance of food and drink internet retailing and the multi-channel strategies of key players, as well as the emergence of pure play internet retailers.
Food and drink internet retailing remains relatively underdeveloped globally compared to many other product categories. However, logistics provides a key strong growth and opportunities, with many retailers exploring innovative delivery and automated pick-up solutions.
Online food and drink sales in France, the UK and some other markets, are relatively mature; showcasing the potential in other developed markets initially, and subsequently in advanced emerging markets, such as China. Pure play internet retailers in these markets are expanding rapidly and innovating to gain market share.
UK home delivery has been refined by retailers over several years and can provide valuable learning for global retailers. Although the combination of high population density, concentration of wealth in the South East of England and higher margins in grocery retailing compared to the European average are unique factors.
Solving the “last-mile” equation (reducing the costs of residential delivery) remains elusive in grocery retailing. However the rapid development of drive-through units in France, shows a click-and-collect model that retailers see as more profitable than home delivery. In Japan and the UK, store-based click-and-collect has made strong inroads, notably with retailers using their convenience store networks.
While pure play internet retailers remain relatively niche players in grocery categories, the growth of China’s Yihaodian and the UK’s Ocado highlight the potential rise of these companies, helped by developing partnerships with other grocery retailers.
If you purchase a report that is updated in the next 60 days, we will send you the new edition and data extract FREE! Home Page