British grocery chain Co-op may have been a relatively late starter in the e-commerce world. However, when it finally launched its online offering in 2019, the supermarket had the advantage of learning from the successes and missteps of its competitors to learn.
When Chris Conway joined Co-op Food as E-Commerce Director in 2018, the retailer did not have an online shopping presence. Conway's brief was to investigate whether an e-commerce operation would be appropriate and, if so, should be done through partners suggested by our cooperative.
After an initial six months of market and data analysis and customer surveys, Conway noticed a trend that showed customers were always being pushed towards a large shopping cart and a planned deal:
Co-op saw an opportunity to offer customers more flexibility in spending and delivery options than was possible with other supermarkets at the time:
This is where Co-op's role as a last mover in the e-commerce grocery space became an asset as the company didn't have legacy technology to deal with. Conway explains:
Fresh thinking
In early 2019, Co-op launched its e-commerce offering with three distinct offerings: its first online-enabled store, allowing customers in the Chelsea area to order food through the Co-op website, with a minimum sales of £15 and same-day delivery; signed a partnership with Deliveroo as their preferred online grocery partner; and run a trial using Starship robots in Milton Keynes to reach a few thousand customers from a few stores.
At the end of this test year, Co-op had an e-commerce option available in 32 of its stores and Deliveroo users could choose from 500 products delivered from 200 Co-op stores in major cities across the UK .Then, just a year after its e-commerce launch, COVID-19 hit. This had an immediate impact on the supermarket's online expansion strategy, Conway recalls:
Co-op went from delivering thousands of orders per week to hundreds of thousands; it also expanded the range available in its own two-hour offer from 2,000 products to over 7,000 and from 500 to almost 1,800 products at Deliveroo.
The company is aiming to close 2021 with nearly 2,000 e-commerce locations and is on track to grow online sales from £70m to £200m by the end of the year, Conway adds:
Platform
For its e-commerce platform, Co-op uses Bringg's Last Mile technology, Salesforce Service Cloud and Marketing Cloud, as well as a separate search engine, referral service and order management technology, all integrated into the Co-op Ecosystem based. The company built its own co-op website upstairs and opted for a headless commerce solution, says Conway:
We built it so that we can talk and interact in real-time with different platforms and different partners. We have a whole range of partner services, all of which are part of our cloud-based infrastructure. This infrastructure obtains feeds from our pricing system, our advertising system and our product information systems. We then pass on price, availability and product data to the appropriate partners or platforms such as Deliveroo or Starship.
The Co-operative Group, owner of the Co-op, was an existing Salesforce customer, but Conway notes that from an e-commerce perspective, the company had no obligation to choose Salesforce for these services. The decision was based on the fact that Salesforce is future-proof and a software-as-a-service solution:
Co-op has used Service Cloud from the start to ensure its internal contact center was unified from a communication and customer perspective, but it's only in the last few months that Co-op has properly launched its CRM campaigns since it initially it required building an established base of regular online shoppers. Conway explains:
With the UK online grocery market valued at £25bn, the company is aiming to close 2021 with nearly 2,000 e-commerce sites and is on track to reach £70m online sales by the end of the year to £200m, Conway adds:
Nevertheless, the local co-op shop remains an important element in the overall picture, he notes:
