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Tesco has reported solid results for the 13 weeks ending 25th May 2019 with strong trading over Easter, through Booker and online as it began celebrating its centenary year.

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Over the last 12 months, Lidl has expanded its online presence from four countries to 11, including grocery ecommerce operations in five countries. With the discounter accelerating its online expansion we look in-depth at its presence across Europe and the US.

Lidl’s online presence

Since the beginning of 2019, Lidl has launched grocery ecommerce operations in three countries and a non-grocery range online in Poland. The pace of its online store openings is accelerating in Europe, aligned with its current strategy to offer more digital solutions to shoppers. Lidl uses online non-grocery, as an extension of its physical stores, providing additional ranges to its shoppers.

The map below summarises Lidl’s online presence for its grocery and non-grocery ranges across Europe and the US.

 

Partnerships for online food delivery

In most markets where it offers online food, Lidl partners with well-established online supermarkets, such as Lola Market in Spain and Boxed in the US, instead of managing the process itself. This is an efficient and safe way to offer a new service to shoppers thanks to very limited investment required.

With online supermarkets managing orders and deliveries, Lidl doesn’t have to change its supply chain or invest in new facilities as products will be picked in store. These partnerships will also provide Lidl with a better understanding of shoppers and potentially improve its ranges and services.

In Italy and Spain, Lidl partnered with companies managing online grocery for other retailers, enabling it to also compete with these retailers, online. In every market where it offers online grocery, Lidl uses the same strategy. It tests the delivery in a limited area, usually a major city, before expanding to other cities. Tests in Belgium and Italy are proving successful and there are plans to expand the services to more cities.  

Future online developments in Europe

Earlier in May 2019, Schwarz Group, Lidl’s parent company, stated that investments and developments in digital will be an area of focus in 2019. Other markets are likely to follow, Lidl France has already mentioned it has plans to expand its ecommerce operations by 2020.

Currently the UK is the only major European market where Lidl doesn’t have any online presence. With all other major retailers offering online solutions, it appears as a country to watch for Lidl’s next non-grocery online store.

On top of these online stores’ developments, Lidl also invests in digital and payment solutions. It currently tests new payment solutions such as SHOP&GO in Paris and self-checkouts in several European cities.

On the digital side, Lidl continues the expansion of its loyalty programme, Lidl Plus, now available in five countries, after being launched in 2018. Following the success of the app in the different markets, we anticipate other countries will launch it by the end of 2019 as part of the discounter’s global strategy to strengthen its relationship with shoppers.

IGD can support all your online needs. For short-term success, we can advise you on how to sell more online. For the longer-term, we can help you prepare for the future and the new opportunities e-commerce brings, such as omnichannel, rapid delivery and social commerce. For more information, get in touch with Milos Ryba, Head of Retail Strategic projects, [email protected].

Keep up-to-date with the latest discount channel developments. Sign up for our channel specific newsletter. For subscribers wanting to know more about Lidl, please have a look at our Strategic Outlook for 2019.

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Maxime Delacour

Senior Retail Analyst - Discount

If you have a specific business challenge or training requirement we can put together something just for you.

As Lidl continues its rapid expansion across Europe and the US, it is looking to build stronger relationship with its shoppers. As Lidl invests in its stores and expands the ranges and services it offers, identify your opportunities with the retailer as we explore the latest strategic priorities that will influence its future performance.

We review and assess some of the key stories over the past month.

The growth of food halls - Time Out Miami opens its doors while Market Halls confirm fourth UK site

We’ve been talking about the rise of food halls for a while now. And while there is some fantastic development underway in Europe, North America still leads here in our view, given the abundance of and diversity of developments that are under way across both the US and Canada. And this makes it interesting that Time Out Market chose the US for its second site, after Lisbon, using Miami as it’s springboard into North America.

Development continues in Europe however as well. Amsterdam’s Foodhallen now has opened in Rotterdam, while London’s Market Hall, off the back of opening its second site at Victoria and while it moves towards opening its third, flagship site on Oxford Street, has confirmed a fourth venue in Canary Wharf.

The rise of health and wellness - Crussh launches new UK menu and expands partnership with Sainsbury's

One of our top trends in 2019 is the rise of health & wellness. A consistent drive towards offering more better for you solutions has been a core principle of development for many this year, significantly outlasting its typical January moment in the sun. And the latest initiative in this space is the expansion of Crussh products to just over 60 Sainsbury’s stores across London, focusing on its Local convenience operations. Crussh has also been developing new products in-store - while it might be the coffee with CBD oil that has captured the headlines, there’s considerable additional range breadth in the menu, which we discovered testing the new range on its launch day.

Partnerships - Foodmaker partners with Monoprix, as Co-op announces tie up with Superdrug and Sainsbury's launch food-to-go trial with Euro Garages

The theme of partnerships is one that remains front of mind across the food-to-go sector. Three collaborations caught our eye: Foodmaker’s tie up with French convenience chain Monoprix, building on a collaboration in its native Belgium with Delhaize, whereby it provides quality hot and cold dishes to Delhaize stores with a food-to-go focus, whether they be its food-to-go led Fresh Atelier format or its Fresh Atelier counters in larger format stores.

At the same time, Co-op’s trial with Superdrug, to supply a food-to-go range into selected Superdrug travel locations, represents a further affirmation of the great work Co-op has been doing in food-to-go.

Sainsbury’s is taking making a second attempt at working with Euro Garages – this time rather than running full franchise stores, the wholesale-based trial in selected stores offers a range of own-brand sandwiches, wraps and salads, as well as ‘food for tonight’ items like ready meals. This builds on a recent food-to-go trial with WH Smith at travel locations, which has been put on hold.

M&A a focus among London specialists

EAT's current owners Horizon Capital announced a few weeks ago it was looking to sell on the business, and a deal was completed in the last few days for leading food-to-go chain Pret to acquire the business, more detail on which can be found here. Asian-led, healthier oriented food-to-go specialist Pod has revealed it too is looking for a buyer. Both are at different stages of development. EAT has recently been adding to its UK portfolio with new airport sites in Spain, as  well as one shop at Paris's Gare du Nord. While for Pod, a key driver behind the quest for new investment is to upgrade their core, London-centric store estate.

As we up the pace of our food-to-go insights programme

H2 2019 holds lots of excitement for our wider food-to-go programme. We’ll be launching our new UK food-to-go report at the start of the half, while at the end of the half, we’ll run our Food-to-go Conference, but in a new venue and with a new dimension to it. Namely, we’ll be holding it under the wider umbrella of IGD Live, a new event that brings the best of our channel and shopper marketing events together under one roof. Click here to book your tickets for November 6. 

It has been revealed in press reports that long-term Musgrave Chief Executive, Chris Martin is to step down from the business after 14 years.  No successor has yet been named, and Mr Martin will remained with the company to ensure a smooth transition over the coming months.  The news comes shortly after Musgrave announced its financial results for its 2018 trading year, posting turnover up 3.8% to €3.9bn driven by a focus on the company's 'reinterpreting retail' strategy.

Centra retail sales reach €1.9bn

While SuperValu remains the biggest of the Musgrave supplied retail brands with sales now at €2.9bn through 254 stores across the island of Ireland, Centra, its internationally recognised convenience brand, has 549 stores with sales now topping €1.9bn.  The remainder of the supplied retailers in Ireland operate 569 stores under the Mace, Daybreak and Day Today fascias, while in Spain Musgrave's subsidiary supplies 83 Dialprix stores.

Portfolio of sub-brands continues to evolve

Key to Musgrave's strategy of reinterpreting retail has been the development of a number of in-store concepts providing retailers with solutions to execute a range of credible food and drink-to-go solutions in a retail environment.  These include the Frank & Honest coffee brand, offering barista and/or self-service capability.  Now the leading takeaway coffee brand in Ireland, 2018 saw Musgrave complete the roll-out of 100% compostable cups and lids, helping the brand achieve a 40% volume uplift over the year.  2018 also saw the launch of Caramico a fresh gourmet pizza offer, extending retailers' scope to compete in the takeaway pizza market.

Acquisitions add further capability

Over 2018 Musgrave made two notable acquisitions: La Rousse Foods, a fine foods foodservice wholesaler and Donnybrook Fair a five-strong Dublin-based deli-cafe chain.   These give Musgrave new platforms through which to target growing opportunities both in foodservice and retail in the thriving Dublin food-scene.

Presentations

04/06/2019
Find out how this inspirational store delivers superior customer service, outstanding shopper experience and margin-enhancing efficiency
21/05/2019
The quality of execution and high-end feel in Dunnes re-designed stores is very evident from our visit to Bishopstown, just outside Cork.
07/05/2019
In this report we showcase some of the latest thinking from Centra in stores around Cork and Limerick. We show how the Musgrave concepts and in-house brands can be adapted to service local needs and shopper missions.
View all presentations

Key Presentations

For more insight into the Irish grocery market, take a look at our Ireland country presentation.

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