The "The Future Of Online Groceries - Ultra Fast Convenience 2020" report has been added to ResearchAndMarkets.com's offering.
As online penetration rates remain high and are increasing especially in the areas which suffer new national or regional lockdowns, as we enter the second and third Covid waves in the West, online grocery is being transformed.
The big multichannel grocers have or are working on their big basket solutions, be they home delivery or click & collect. But there is another basket size that is not yet served well, which is the convenience shop type - often distressed shopping late at night (OTC medicines for example) or ingredient substitution, etc. This is the new growth frontier in online grocery - ultra-fast convenience deliveries. This report analyses the grocery offerings, rather than restaurant takeaway deliveries, as the restaurant delivery app players with their logistics networks are all muscling in on this space now.
If one dares to look at a future beyond Covid-19, there should be a big future opportunity for small baskets, according to Tesco a 10bn opportunity in the UK, or in other words about 4/5 of the entire online grocery sector as it stands. And in any other markets, the opportunity will be as promising.
But as Amazon has demonstrated over the years with their relatively small average basket sizes in online grocery, this is really hard to make work financially. The commissioning and delivery cost will eat up all the available margin, especially as food transaction baskets are not that high value. But at least Amazon changes a Prime fee for rapid deliveries (PrimeNow and now AmazonFresh free on regular Prime membership in the US and the UK) and has a minimum basket (otherwise extra fees apply). As an aside, Amazon also manages to mix food and higher non-food margins much better in these baskets due to it being the everything store.
Then again, there seems to be a sector that manages two make these ultra-fast deliveries work up to a point. Restaurants can do it apparently, serving food baskets rapidly (to keep the meals hot) and are being convenient and have trained customers to be willing to pay fees (service/ delivery fee for rapid delivery). The point that most of the aggregator services (Deliveroo, Uber Eats, etc) are still loss-making is a different matter.
One can ask the question of whether companies can make money with network effects on a point to point delivery run (restaurant to household), especially with such small time windows. A related question is how many orders can operators reasonably expect to batch within the tight time frame for hot meal deliveries. The UK's Deliveroo works with 3 drops an hour which are very good, but probably at the maximum end of efficiency for a point to point system.
This means that the pressure on being ultra-fast will only increase for retailers going forward. Online grocers working with next day delivery could soon become laggards, even though same-day capabilities are quite cutting edge still as we are writing this.
Tapping into new delivery and logistics models, such as the takeaway apps, seems to be an enticing option for grocers. Not for nothing have Amazon invested in Deliveroo after all. The company is building out its amazing logistics footprint, even more, becoming increasingly more the pipe through which everything flows.
Key Topics Covered:
1. Executive Summary
2. The Structure of the Market
Market Structure: Traditional Online Grocery Versus Ultra Fast Convenience
Market Structure: The Players
Market Structure: Hot Food Expectations Transferred to Grocery
Market Structure: Point to Point Versus Hub and Spoke
Market Structure: The Logistic Networks of the Takeaway Apps
3. Market Sizes
Market Sizes: Online Grocery, UK Market Sizes, Data
Market Sizes: Ultra Fast Online Grocery Market Sizes UK
Market Sizes: Food Delivery Market Sizes
Market Sizes: Takeaway Delivery Market Sizes - Data, EU$
App Usage Stats: Takeaway Delivery Apps, Us and UK
Takeaway Delivery Top 3: UK and US
4. The Players
Ocado Zoom: Stronger Than Expected
Waitrose Rapid: Maximum Basket Size of 25 Items
Sainsbury's Chop Chop: 50 Stores by 2020
Instacart: On-Demand Delivery Partnership with 7-Eleven
Instacart: on the Way to Super Fast Deliveries
Amazon Prime Now: Not Fast Enough Anymore
Amazon: The Deliveroo Investment
Amazon: The New Ultra Fast Fresh Service
Amazon: Fresh Becomes a Prime Benefit
5. The Takeaway App Models
The Model: Platform Versus Logistics Service Model
The Model: Amazon Versus eBay in Foodservice?
The Model: A Convergence of Models at a Cost
Just Eat Takeaway
Strategy: How to Bring Costs Down
Self Driving Cars: Not Happening?
Self Driving Cars: Shifting from Robo Taxis to Trucks
Self Driving Cars: Focus on Highways
Dark Kitchens: The Pros, Lower Costs, Flexibility, Bigger Catchments
Dark Kitchens: and Cons, Control, Brand Building, Bad Rep
Dark Kitchens: Prototypes, Shared Space Vs Single User
Dark Kitchens: Business Case to Become Grocery Mfc?
Outlook: The Case for Ultra Fast Online Grocery
Holland & Barrett
For more information about this report visit https://www.researchandmarkets.com/r/2nbhp8
View source version on businesswire.com: https://www.businesswire.com/news/home/20210122005242/en/
Laura Wood, Senior Press Manager
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