Innovation and collaboration will be vital to converting more consumers to online grocery shopping, but UK retailers need to be aware that one solution does not fit all customers’ needs and the answers are not necessarily transferable across different markets. Produce Business UK hears the thoughts from two leading grocery retailers – Asda and Tesco
The Asda approach
Walmart International’s senior director – international ecommerce, Saeed Anslow, claims the retailer has continuously sought to bring experience and innovation from its 28-country presence back into Asda’s online business in the UK, but he stresses that “one size does not fit all”.
“There’s been a lot of development in the UK business between 2012 and 2015,” he explains. “We see our role as bringing innovations from around the world back into the UK.”
As head of Walmart’s international acceleration team for ecommerce, Anslow focuses on taking learnings from the UK online grocery market – described as being significantly more advanced than those of other territories where Walmart is present – and seeing where they can be applied globally.
Anslow outlines his remit as working to create a technology company within one of the world’s largest retailers; an objective in which he states the company is already making progress.
Added to innovation, Phil Wilkinson, senior director of grocery ecommerce at Asda, argues that continuing to make progress in the online sales arena can only be achieved through collaboration, as well as having a clear focus and alignment with partners.
“Collaboration is key to getting things done in ecommerce,” he notes. “Working in ecommerce has opened my eyes to complexity and importance of collaboration with internal and external stakeholders.
“Ultimately, collaboration is all about the customer – there isn’t one best way, but if it’s simple and enhances the customer proposition, then it will drive profitability.”
Wilkinson also emphasises the importance of never losing sight of the end consumer when developing an effective online solution. “I really value simplicity and keeping the customer at the heart of things – simplicity is going to be my focus for next year,” he reveals.
Stressing the importance that ecommerce now holds for the retailer, Wilkinson adds that online retailing is no longer viewed as a “bolt-on or afterthought” for Asda, but rather as being at the heart of and the future for the business.
However, he does admit that Asda needs to make its mobile site “quicker and easier” for customers, adding that more work is required to improve the merchandising of foods and to better align the front-end of the website with physical Asda stores.
Tesco’s richer product experience
Adrian Letts, Tesco’s recently-appointed online managing director, claims that so far the UK’s leading grocery retailer had done a good job of delivering an appealing ecommerce proposition, but he confesses it is getting harder and harder to balance customer appetite with the investment required.
Again emphasising the need for collaboration, Letts says Tesco, working together with its partners, needs to evolve its merchandising proposition, to one that affords a much richer and more engaging product experience.
“Showcasing brands and sharing the learning from customers will improve the proposition for all stakeholders, which will better equip us to respond quickly to customers’ continually changing needs,” he says.
Such considerations may have been instrumental in persuading Tesco to embrace greater interaction with consumers, principally through The Orchard At Tesco review platform, which the company launched in December 2013.
Explaining the rationale behind the ‘word-of-mouth’ focused project, Tesco Orchard manager Roshni Chandarana explains that as well as being the most talked about brand in the UK, the retailer is also the least liked and the most likely to feature negatively in conversations.
Describing it as an ‘advocacy’ platform, Chandarana says the Orchard venture has been developed so consumers can share “a range of related experiences” about the retailer and its products.
Using Clubcard data and profiling to recruit members, she claims the site currently has a member base totalling nearly 145,000 shoppers; attracting members with the prospect of free or “close to free” trials of a range of products.
Increasingly, Chandarana reveals Tesco is utilising the project to develop new products, including a Honey & Lime Chicken sandwich and a soon-to-be-launched ice cream flavour.
Success ahead for Amazon?
One company that already carries out a great deal of innovation within the online marketplace is Amazon. With AmazonFresh grocery deliveries potentially launching next year in the UK, IGD’s senior retail analyst for online and retail, Lisa Byfield-Green, points out that the UK, alongside Germany, is Amazon’s biggest market outside the USA and it is starting to see some innovation.
“There are big questions about whether or not AmazonFresh will be successful,” she notes. “Certainly it’s challenging coming into a market where there are a lot of established players. “But as shoppers, we are very influenced by everything Amazon does, and anyone that can do convenience online is onto a winner.”
The retailers quoted in this article spoke at the IGD Online & Digital Summit 2015, a seminar held for UK supermarket executives.