Nitheesh NH
FROM THE DESK OF DEBORAH WEINSWIG
Can’t Wait for Two-Hour Grocery Delivery? How About 10 Minutes? The pace of our lives continues to accelerate, including in how retailers make our lives easier and more convenient. Once upon a time, Amazon’s two-day shipping for e-commerce orders was the gold standard of service, driving the retail industry to follow suit; then, in early 2019, Amazon started rolling out one-day shipping in the US. Amazon also launched Prime Now in 2014, offering two-hour delivery of groceries and other items; today, Target offers same-day delivery via Shipt, and Walmart offers express delivery in two hours or less. Now, two-hour delivery seems from horse-and-buggy times. There is a crop of innovators, in Europe and in the US, that promise grocery delivery in as little as 10 minutes, and investors are richly funding them. A recent article in The Guardian cites a Pitchbook analysis calculating that a total of $14 billion had been invested in ultrafast-delivery firms. Getir (which means “bring” in Turkish) offers speedy delivery in Turkey, the UK and the Netherlands, offering groceries, prepared food, home and personal items, pet food and apparel within minutes, powered by a website and an app. The Getirfood function handles delivery from restaurants; Getirmore handles grocery and home items; and Getirwater is a water-delivery service. The platform offers live tracking of the courier, which is becoming ubiquitous, payment digitally in advance or on delivery, as well as day-and-night service. In June 2021, the company completed a $550 million funding round—which values the company at $7.5 billion—enabling it to expand into France and the US. There are many other ultrafast-delivery companies operating in Europe. German ultrafast-delivery firm Gorillas launched in the UK in March 2021 and promises a 10-minute grocery delivery service, and Flink (which means “nimble” in German) offers 10-minute delivery in several German cities, the Netherlands and Paris. Jiffy, Dija and Weezy offer grocery delivery in the UK. In New York City, Fridge No More and JOKR offer speedy grocery delivery, and we have recently seen subways plastered with ads from 1520min.com, which offers delivery of a limited selection of groceries in 15–20 minutes, offering a generous 30% discount on a customer’s first three orders to deliveries in several neighborhoods. Food Rocket offers 15-minute grocery delivery in San Francisco. [caption id="attachment_129400" align="aligncenter" width="420"]
1520.com subway posterSource: Coresight Research[/caption] These ultra-fast, venture-funded delivery companies bring fond memories of two companies that delivered food, snacks (including ice cream!) DVDs and other items in New York City during the dot-com era around 2000: Kozmo.com and Urban Fetch. These companies would take orders on the web and dispatch bicycle messengers to deliver over the last mile. Unfortunately, these companies were ahead of their time and sadly closed shop. Technology and society have made huge leaps since the dot-com days. We now live our lives on our mobile devices, and advances in AI (artificial intelligence) enable optimal route planning and labor- and cost-saving automation in dark stores. Over the past year, consumers have become more comfortable with ordering groceries online and have become spoiled by ever-shorter delivery times. However, it remains to be seen what consumer appetite for ultrafast-delivery services (with associated higher prices) will be sufficient to support these business models.
- Keep an eye out for our new report on hyperlocal delivery and quick commerce, publishing this coming Monday.
US RETAIL AND TECH HEADLINES
Food Lion Expands Roll Out of Curbside Pickup (June 28) Company press release- Ahold-Delhaize-owned banner Food Lion has expanded its “To Go” pickup service to a further 14 stores, including eight locations in North Carolina and six locations in Virginia. Customers can place their orders via the Food Lion website or mobile app and pick up the groceries on the same day without entering the store.
- Food Lion’s “To Go” service costs $1.99 for orders of $35 and above and $3.99 for orders less than $35. Earlier in June, Food Lion debuted the service in 32 stores, including 28 in North Carolina, three in South Carolina and one in Virginia.
- Gap Inc. has released its first Equality and Belonging (E&B) report, comprising a 21-page plan to help drive “systemic change” in workplace equality and inclusion. The E&B report highlights various programs and activities to drive change, such as removing educational requirements for 99.7% of job descriptions below the vice-president level to support workplace equity.
- Gap Inc. published this report amid calls on companies to play a more prominent role in supporting workplace equality. In 2020, Levi’s published its first diversity and inclusion report, which provided insights into its global workforce.
- HBC, owner of Hudson’s Bay and Saks Fifth Avenue has promoted Scott Ross from Senior VP of Omnichannel to Chief Technology Officer (CTO), effective from the retirement of existing CTO Stephen Gold on August 1.
- As a Senior VP of Omnichannel, Ross led website and mobile application migration for Hudson’s Bay, Saks Fifth Avenue and Saks Off 5th as well as three global contact centers. The company also praised his efforts in the attainment of consistent double-digit growth for digital channels.
- Smart checkout technology provider Trigo has signed an agreement to join Google Cloud’s partner ecosystem. Under the agreement, Trigo’s autonomous shopping solutions will be available on Google Cloud and staff from both companies will help retailers accelerate their digital transformation toward automated checkout.
- Trigo estimates that around 500,000 convenience stores and small grocery stores (up to 10,700 square feet) globally have the potential to be retrofitted with checkout-free technology.
- Walmart has launched its first private-label analog insulin product ReliOn Novolog, manufactured in partnership with pharmaceutical company Novo Nordisk. Intended for use by both type 1 and type 2 diabetic patients, the new brand will be available in Walmart pharmacies this week and in Sam’s Club pharmacies in mid-July across the US.
- The company stated that its private-label insulin options are priced 58–75% lower than branded equivalents, which equates to a saving of up to $101 per branded vial or $251 per package of branded FlexPens.
EUROPE RETAIL AND TECH HEADLINES
Boots Launches Online Doctor Service (June 29) RetailGazette.co.uk- UK-based health and beauty retailer and pharmacy chain Boots, which is owned by Walgreens Boots Alliance, has launched an Online Doctor service on its e-commerce store. The service is hosted within the Boots Health Hub, which is home to the retailer’s extensive healthcare and pharmacy services.
- The Online Doctor service provides Boots’ customers with access to online consultations, advice and prescription medication, without the need to see a general practitioner. The Online Doctor service caters to 45 healthcare areas, including diabetes, menopause treatments, skin diseases, sexual health, family planning and weight loss support.
- Dutch supermarket chain Delhaize, owned by Ahold Delhaize, has expanded its partnership with Belgium-based food company Foodmaker. Under the new terms, Delhaize will become the exclusive operator of the Foodmaker restaurants in Belgium and Luxembourg, and further expand the Foodmaker restaurant network.
- Delhaize plans to open three new Foodmaker restaurants in 2021 and will then aim to add five new restaurants each year from 2022 onward. Both Delhaize and Foodmaker are researching entry into home and office delivery; initial tests in this field are underway, including a Foodmaker home-delivery service trial in Bascule, Belgium.
- JD Sports’ Spain-based subsidiary Iberian Sports Retail Group entered into an agreement on June 25, 2021, to acquire an 80% stake in Deporvillage for €140.4 million ($168.0 million). Deporvillage, a Spain-based online-only retailer of sports equipment, primarily focused on cycling, running and outdoor activities, generated revenue of €117.8 million ($141.2 million) and reported profit before tax of €7.7 million ($15.3 million) in its fiscal year ended December 31, 2020.
- JD Sports’ management expects the acquisition to significantly enhance the company’s digital capabilities, and boost the company’s position in key sports categories.
- Marks & Spencer (M&S) has entered into a partnership with UK-based footwear brand Clarks to sell its kids’ shoes in eight M&S stores in the UK, as well as on the retailer’s e-commerce site.
- This new collaboration under “Brands at M&S” is part of the retailer’s strategic shift away from “special occasion” apparel and footwear toward “everyday style and value” items. M&S noted that this strategy will help the company to grow in kids’ casual categories, including jeans and joggers, and enable it to maintain its reputation as the “go-to” retailer for “trusted-quality, value school uniform.”
- Zalando will invest €300 million ($358 million) in opening a new logistics site in France, as announced at the “Choose France” summit held on June 28. During the summit, French President Emmanuel Macron pitched France as an investment destination to 120 international chief executives. Robert Gentz, Zalando’s Co-CEO, was part of the event.
- Zalando’s new logistics site is part of the company’s 22 upcoming investment projects worth a total of €3.5 billion ($4.2 billion), although the project completion date is not yet known. Zalando’s new site is set to create around 2,000 jobs in France.
ASIA RETAIL AND TECH HEADLINES
Unicommerce Records 51.0% Order-Volume Growth in India’s Online Fashion Industry in Fiscal 2021 (June 29) ) ETRetail.com- The Indian online fashion industry saw 51.0% growth in order volumes in fiscal 2021, with some brand websites witnessing order-volume growth of up to 66.0% during the period, according to Unicommerce, an India-based cloud e-commerce solution provider.
- The increasing popularity of the direct-to-consumer (DTC) sales channel among many fashion brands is a key factor behind the high growth rate.
- Gentle Monster, a South Korean luxury eyewear brand, has introduced a themed flagship store in the Starfield Hanam shopping complex in Seoul.
- The brand uses virtual reality technology alongside artworks and 3D installations to create an immersive and engaging physical shopping experience.
- According to a recent PayPal report, most online shoppers in Hong Kong prefer to purchase their goods internationally, reporting China (53.0%), Japan (38.0%) and the US (34.0%) as the top cross-border purchase locations.
- The report also indicates that better pricing is the leading motivation to shop internationally (46.0% of respondents), followed by access to items not available in local outlets (33.0%) and better quality of products (33.0%).
- Suning.com’s Retail Cloud opened 247 new physical stores across China during the country’s 6.18 Shopping Festival in mid-June.
- Suning Retail Cloud, which launched in 2017, is focused on expanding its footprint across China’s lower-tier cities markets.
- Grofers, an Indian grocery e-commerce firm, has signed a deal with Tiger Global and Zomato to raise $120.0 million in funds, in a move dubbed as a significant consolidation development. The deal firmly establishes Grofers in the growing pool of Indian unicorns.
- Food delivery firm Zomato is expected to contribute $100.0 million and Tiger Global will invest the remaining $20.0 million. This investment will help Zomato to enhance its grocery delivery vertical and gain a competitive edge over existing market players, including Amazon, BigBasket, Flipkart and Reliance JioMart.