The Dutch grocery sector in 2030 - RETAILes - TALE 3: ONLINE GROCERY SHOPPING - Roland Berger
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RETAILes: The Dutch grocery sector in 2030 1
RETAILes
The Dutch
grocery sector
in 2030
TALE 3: ONLINE GROCERY SHOPPING
2 RETAILes: The Dutch grocery sector in 2030
RETAILes: The Dutch grocery sector in 2030 3
BACKGROUND
Roland Berger and EFMI Business School have recent- an in-depth food industry survey in which 150 Dutch
ly conducted a joint study to gain insight into the fu- executives from retailers, fresh food companies, brand-
ture of the Dutch grocery sector and to understand and private-label manufacturers gave their views on the
how the industry could transform itself over the next future of the grocery sector.
10 to 15 years within the context of a rapidly-chang-
ing world. In order to capture accurate insights from In a series of tales we aim to give an impression on
within the sector, we organized roundtable discussions what the industry could look like in 2030. Selected
with CEOs and senior management of a wide variety focus areas include the future of the brick-and-mortar
of players active in the food and retail industry – both store, the impact of digitalization and the social impact
incumbent companies and innovative newcomers. of these developments. In this third tale we discuss
In addition to the insights gained from these round the impact of online grocery shopping on retailers
table discussions, EFMI and Roland Berger conducted (Figure 1).
In the study we propose to focus on 3 selected areas:
In this third tale
developments we discuss what
in brick-and-mortar, we couldand
digitalization expect
socialfrom the future of online grocery
impact
shopping
…
Figure 1: RETAILes: The Dutch grocery sector in 2030 …
INTRO BRICK-AND-MORTAR DIGITALIZATION SOCIAL IMPACT
0
Introduction to
1 The grocery store of
the future
3 Online grocery
shopping
5 Sustainable
supply chains
RETAILes: The
Dutch grocery
sector in 2030
2 Innovative in-store
technology
4 E-commerce
models
6 The pursuit
of health
4 RETAILes: The Dutch grocery sector in 2030
KEY TAKEAWAYS OF TALE 3:
ONLINE GROCERY SHOPPING
• Online is an important growth driver for
groceries, but value share is still limited
• Dutch online grocery sales lag behind
the UK, France and some Asian countries
• Our industry survey suggests that Dutch
online groceries will develop into a
high-value channel in the next decade
• Grocery players need to develop their
online capabilities to leverage the
long-term potential of onlineRETAILes: The Dutch grocery sector in 2030 5
Online grocery shopping is an important Figure 2: FMCG vs. total % online per country, 2017
growth driver for groceries, but value share
is still limited
25
Online grocery shopping is one the main growth seg-
ments in the grocery industry. Online grocery sales
showed an impressive growth rate of more than 50% in 20
South
the Netherlands between 2015 and 2018. Incumbent Korea
food retailers are developing their e-commerce prop-
FMCG online
osition and are increasingly offering home delivery and 15
click-and-collect services. Pure online players, such as
PicNic in the Netherlands, have entered the market, ex-
10
panding their business and challenging the traditional
players. France UK
Mainland
The total value share of online grocery shopping in the 5 China
Netherlands is however still limited. In 2017 2.5% of
Netherlands
Dutch grocery sales (EUR ~1 bn) were sold through on- Germany
line channels1. These figures are in contrast with total 0
e-commerce sales, which have taken off at a signifi- 0 5 10 15 20 25
cantly higher pace (the online value share of consumer Total online
goods totaled 12% in the Netherlands in 20172).
Bubble size represents total value of online FMCG sales
Dutch online grocery sales lag behind the Source: Kantar, Euromonitor, Nielsen, Statista, Roland Berger analysis
UK, France and some Asian countries
Large differences in online grocery sales exist be- (a model in which consumers order online and pick up
tween countries, both within Europe and inter- their purchases at a local store) underpinned the ex-
continentally. Differences can largely be attrib- pansion of online grocery retailing in France. Market
uted to country-specific market characteristics, characteristics of countries such as France – a super-
variation in online shopping adoption rates and retail- market-heavy country that has a large component of
ers’ belief in online grocery shopping (Figure 2). shoppers doing their groceries by car – have contrib-
uted to the local success of click-and-collect. The UK is
The UK and France, for example, the leading a country where home delivery took off, relatively lat-
European online grocery markets. The early intro- er PUPs were introduced there. In the UK, companies
duction of drive-through pick-up points (PUP’s) such as Tesco, Asda and Waitrose have installed click-
1 EFMI (2017)
2 Thuiswinkel.org; GfK (2017)tion to6
1 The grocery store of
the future
RETAILes: The Dutch grocery sector in 2030
3 Online grocery
shopping
5 Sustainable
supply chains
s: The
ocery
2030
2 Innovative in-store
technology
4 E-commerce
models
6 The pursuit
of health
and-collect facilities at stations in London to enable Asian countries, or if Dutch market characteristics,
consumers to save time by picking up grocery orders such as a high density store network, will constrain
on their way home. Consumers in the UK demonstrate the growth of online grocery shopping.
serious commitment to online grocery shopping, with The results of the EFMI and Roland Berger in-depth
those who shop online doing so at least once a month3. industry survey provide an answer to this question.
Responses from the 150 Dutch food executives that
South Korea is the world leader in e-commerce gro- participated in this survey indicate that online grocer-
ceries. According to Kantar Worldpanel, 16.7% of total ies will grow by an annual rate of 14%, and is expected
fast moving consumer goods (FMCG) products were to reach a total market value of EUR ~7.7 bn in 2030
purchased online in 2017. The online market in Asia is (Figure 3). In terms of impact, survey respondents in-
traditionally more developed than that in Europe. The dicated that online will have the most impact on the
digital economy is embedded in the Chinese and South traditional grocery landscape of all the trends assessed
e 2: FMCG vs. total % online per country, 2017
Korean culture. This can be illustrated by online shop- in the survey.
ping penetration rates, which totals more than 60% of
25 the population, compared to around 30% in Europe4. In
Figure 3: Growth of online grocery value share in
the Asian market, home delivery models are more wide-
the Netherlands according to the Dutch Food
ly adopted than click-and collect.
industry (2017-2019) (%CAGR)
20
South
The Dutch and German online grocery markets lag be-
Korea 16%
hind other European markets like the UK and France. +14% (~EUR 7.7 bn)
15 The slow start of Dutch online grocery shopping can
be explained by the high density store network. Most
consumers have one or multiple grocery stores in their 2.5%
10 (EUR 1.0 bn)
direct environment and stores are easily accessed by
foot France
or by bike. In UK
Germany, the strong presence of dis-
Mainland 2017 2030
5
counters has held back online
China sales.
Ø Online market share in 2030: 16%
Our industry
Germany survey
Netherlands suggests that Dutch
0 online groceries will develop into a 35%
0 high-value
5 10 channel
15 in
20 the next
25 decade 21%
16% 20%
The keyTotal onlineis whether online grocery sales in
question
Share of
respondents:
5%
the Netherlands
Bubble size represents willFMCG
total value of online develop
sales into a significant val- Expected
ue channel, following the lead of other European and online MS in 0-5% 6-10% 11-15% 16-20% >20%
2030:
Kantar, Euromonitor, Nielsen, Statista, Roland Berger analysis
3 Fung Global Retail & Technology (2016) Source: EFMI and Roland Berger in-depth food industry survey of 150 executives (2018), Kantar, CBL,
Distrifood
4 Kantar Wordpanel (2017)RETAILes: The Dutch grocery sector in 2030 7
serve their customers. In the online delivery model,
Main drivers of online growth are a maturing market, for example, various players are pushing for faster and
technological developments, wider target audience and more flexible delivery solutions. In order to stay compet-
increased competition. First, a maturing online market itive in this developing environment, grocery retailers
will address online grocery shopping neophobia, or the need to further optimize their fulfillment process (e.g.
fear of people to use this new and unknown shopping automated distribution centers) and think about inno-
method. Many of the concerns that consumers who vative solutions for last-mile delivery (e.g. third-party
have not adopted online grocery shopping have, are ex- delivery).
pected to be addressed in the near future. For example,
the most mentioned reason by people for not purchas-
ing their groceries online is the inability to check (fresh)
product quality. A maturing market is expected to solve
this issue by careful product selection and fresh-proof
transportation. Second, technological developments,
such as the rise of automated fulfillment centers and
new delivery solutions will drive delivery speed and fur-
ther help to position online as a convenient and fast
solution. Third, small businesses and institutional tar-
get groups (e.g. daycare centers) are increasingly pur-
chasing groceries online. Today, approximately 25-30%
of online sales come from this segment. Foodservice
wholesalers are facing increasing competition from the It is critical that grocery
online operations of grocery retailers. Finally, compe-
tition for online market share is expected to result in
players develop the right
lower minimum order sizes for free delivery and new capabilities to continue
solutions for the last-mile network, which will further
reduce consumer costs and increase the accessibility of to effectively serve their
online products.
customers through online
Grocery players need to develop their
online capabilities to leverage the
models.
long-term potential of online
Although it is also a legitimate choice for retailers not to
be active online (e.g. Nettorama), retailers that choose
to be active in online groceries should focus on devel-
oping the right capabilities to continue to effectively8 RETAILes: The Dutch grocery sector in 2030
PUBLISHER
Roland Berger Amsterdam
World Trade Center Amsterdam
Strawinskylaan 581
1077 XX, Amsterdam
The Netherlands
+31 20 796 0600
www.rolandberger.com
EFMI Business School
Groeneveld 2
3744 ML Baarn
The Netherlands
+31 35 303 7777
www.efmi.nl
AUTHORS
Alexander Belderok – Alexander.Belderok@rolandberger.com
Mireille Einwachter – Mireille.Einwachter@rolandberger.com
Marcel van Aalst – MvanAalst@efmi.nl
Joris Winkelman – Joris.Winkelman@rolandberger.com
Rosie Veul – Rosie.Veul@rolandberger.com
DISCLAIMER
This study has been prepared for general guidance only.
The reader should not act on any information provided in
this study without receiving specific professional advice.
Roland Berger and EFMI Business School shall not be liable
for any damages resulting from the use of information
contained in the study.
© 2019
Roland Berger and EFMI Business School
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