Moped delivery

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 The concept of convenience is being redefined by the 10-minute delivery apps

It’s great sport tracking retailers’ shares over the Christmas period. However, a tactically strong Christmas execution is no longer a good indicator of long-term prospects in grocery. There are too many disruptive dynamics in today’s market.

Breaking it down, the primary drivers of shopper loyalty remain price (at a given quality), choice and convenience. Sure, other factors play a part – such as ambience, ease of shop and service – but these take a back seat in today’s hot marketplace.

The pressure on the mults is rising. As the major retailers fund their costly push into online and count the cost of Covid logistics, inflation has burst through into a market compressed by soaring input costs, supply chain crises and now staff strikes. With discounters regaining share, the mults are naturally nervous, investing in innovative strategies for fear of backing the wrong reindeer. The jury is still out on checkout-free stores and q-commerce, so pumping money into 10-minute deliveries looks dodgy in their finance departments.

But it could be just the right move. For a decade we’ve seen ‘mults vs discounters’ as the share tug of war. In terms of those primary drivers, this is the battle of choice vs price. Macro-economic pressures have increasingly pushed the shopper to price, whilst clever ranging in the discounters has made a lower-choice environment more palatable for them. Locations and store sizes have locked the big five into business models that ultimately cannot win on price, so in the search for a solution, maybe convenience is the answer.


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Convenience is the missing loyalty factor in this tug of war. C-stores were big winners in the pandemic, and if retailers are convenient enough, shoppers are prepared to pay up to a 15% premium – albeit on smaller basket sizes. This is possible because convenience shopping is no longer about local store locations. The concept is being redefined by the 10-minute delivery apps.

Online shopping was perhaps another big lockdown winner, but on its own, it’s not a convenience offer. It’s still a planned major shop that needs to present value on standard goods. ‘Online and fast’ delivery, on the other hand, really is convenience.

With a third of q-app users replacing their weekly shops (InMobi data) and 75% saying they’d ditch the apps if the mults adopted a similar service, surely this is a priority for the big retailers. Battling on price is a losing strategy for the mults and choice is not winning either, but if they can offer wide choice with the convenience of rapid delivery, the discounters’ price advantage will be diminished for the first time.

As always, Tesco is first to recognise and react to the importance of 10-minute delivery – it is investing. None of the mults can ignore this trend. Equally, as they lay down more bricks, discounters can’t ignore the fact that tech-savvy shoppers are now the majority and, without online, they are going to struggle to hold their hard-fought share gains.