Hannah Gibson - press shot

Ocado Retail has been gaining customers from the discounters, CEO Hannah Gibson has told The Grocer, as the online supermarket posted a 10.6% increase in active customers.

“In the last period, it’s small numbers, but you can see people switching from Aldi and Lidl for the first time,” Gibson said.

The retailer’s active customer base grew to 959,000 in the 26 weeks to May this year, with the bulk of new customers switching from rival supermarket online offerings.

“They try other online services, they come and try Ocado and realise it is a better offering, a better service,” Gibson said.

Other customers were being drawn from shopping in-store at Waitrose and others, she added.

Some Ocado products – like its Kido own-label nappies – now price match with Aldi, while around 10,000 products are matched against Tesco as part of the retailer’s Price Promise, which was revived in March.

“We’re appealing to a broader cohort of customers now than we ever have done,” Gibson said.

Average orders per week grew 4% to 392,000 and the average basket value increased 1.5%, driven mainly by an increase in average selling price. These increases were offset by a decline in basket size to an average 45 items and lower order frequency.

The joint venture with M&S swung from a £31m profit a year ago to a £2.5m loss in the 26 weeks to May, but group CEO Tim Steiner said business was making “good progress” and returned to profitability in the second quarter as prices were sharpened.

The retailers share of the online grocery market edged up from 12.7% to 13%. “I won’t put a number on a share we can get to but it can and it will be a lot higher,” Gibson said.

Gibson – who took the CEO role in September last year – insisted relations between Ocado and M&S were good, despite M&S CEO Stuart Machin recently calling out availability issues and M&S chair Archie Norman saying he was “not happy” with Ocado Retail’s performance.

Gibson said she and Machin “get on very well” and “talk a lot”.

“There’s a lot to get through but that’s a positive thing. There’s is so much opportunity for us working better together, that journey is now happening,” Gibson said. “We are working absolutely together on range, on availability, on marketing opportunities, and we are really aligned on the opportunities we can unlock and excited about the future direction Ocado Retail is heading.”