We round up the latest innovations from Ahold Delhaize as it invests in ecommerce, formats and ranges in the US and the Netherlands.

Ahold Delhaize USA rolls out same-day delivery…

Ahold Delhaize USA has partnered with start-up Deliv to provide customers with same-day delivery for online orders. The new service will initially be available at checkout to Giant Foods and Martin’s shoppers who order from Peapod. The retailer hopes to expand the service to other banners in the US soon.

JJ Fleeman, president of Peapod Digital labs and chief e-commerce office of Ahold Delhaize USA, said the service will help to “conquer the last mile… [and to] scale same-day delivery to the benefit of millions of local brand shoppers by 2020”.

…While Giant opens an ecommerce fulfilment hub

The banner is also set to open a new online pickup centre under a new brand, Giant Direct Powered by Peapod. The 3,530 sq. m centre, located in Lancaster, Pennsylvania, will provide walk-up and drive-up collection for online orders. There will also be a room where customers can place orders from tablets as well as autonomous robots, which will offer support.

Giant Food stores’ ecommerce business was previously known as “Peapod by Giant”. The change and creation of a new facility reflects Ahold Delhaize’s new go-to-market strategy for its ecommerce operations. It also marks the first dark-store conversion, helping to widen the brand’s delivery reach.

Source: Ahold Delhaize

Netherlands: Albert Heijn grows lettuce on water…

Meanwhile in the Netherlands, Albert Heijn has started selling six types of lettuce that have been grown on water. These include, Butter Lettuce, Red and Green Oak Leaf Lettuce, Frisee, Lollo Rossa and Batavia. According to the retailer, the “taste, nutritional values ??and shelf life of these lettuce varieties are comparable to those from the open ground”.

The retailer explained that the growing and transport of lettuce takes place within the Netherlands throughout the year. “Only in winter does a small percentage of lettuce come from Spain, for example, which saves a lot of transport costs and emissions”. Hydroponically grown plants therefore have a smaller sustainable footprint than traditionally grown plants.

Source: Albert Heijn

Other retailers, including Colruyt and Coop Sverige, are also trialling more sustainable methods of plant cultivation.

The move follows Albert Heijn’s earlier trial of a fixture which let shoppers harvest their own lettuce. The retailer worked with lettuce suppliers and Dutch company Hrbs to supply its store in Gelderlandplein, Amsterdam. The aim was “to bring the world of fruit and vegetables as close to the ordinary person as possible”.

…While it tests fresh food vending machine

Following successful tests of its 24/7 Meal Wall in its headquarters, Albert Heijn has begun testing a fresh food vending machine in other locations. This offers a variety of ready to eat, ready to heat and cooking at home meals for breakfast, lunch and dinner needs. If the next phase is successful, the retailer hopes to rollout the solution to hospitals and companies over the next few years.

Source: Christiaan Vette, LinkedIn

…And launches the Wasteful Kitchen in Gelderlandplein, Amsterdam

In other news, Albert Heijn is trialling “Wasteful Kitchen” in its XL store in Gelderlandplein, Amsterdam. The store often acts as a test bed for new initiatives, with the latest activity seeing it create fresh juices, soups and meals using the store’s waste, while also selling frozen bread that may otherwise have been wasted too.

Source: Christiaan Vette, LinkedIn

…And opens applications for Product Pitch 2019

Separately, Albert Heijn has announced that applications are open for its annual product innovation initiative, Product Pitch. The programme aims to “stimulate young entrepreneurship and to discover innovative products”. This campaign sees start-ups compete to win a place on AH’s shelves, as well as money to activate their product and coaching to grow their business.

Abel's Deli, Kaas in 't Bakkie and Knakwortel are among the brands that have previously entered the competition and have then been sold in the retailer’s stores. Applications are open until 15 March 2019 and the product pitches will take place on 4 April 2019.

Source: Albert Heijn

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We look at three online developments from Albert Heijn, Jumbo City and Picnic.

Albert Heijn to open fifth online fulfilment centre…

Albert Heijn will open its fifth online fulfilment centre in Amsterdam, later this year. It will support the growth of its online store, ah.nl, especially in terms of home delivery. The centre will be able to process 40,000 orders every week.

Philip Padberg, the new general manager of ah.nl, commented, “Over the past few years, Albert Heijn has made home delivery easier by, among other things, track & trace, the national rollout of the delivery bundle in combination with free delivery at bol.com and a lower minimum order amount on Wednesday’s and Thursday’s. We are continuing [in 2019] with the renewal of our ecommerce services”. Albert Heijn also has fulfilment centres in Almere, Eindhoven, Rotterdam and De Meern.

Source: Albert Heijn

…As Giant opens first online pickup centre under new brand

Meanwhile, within the wider Ahold Delhaize organisation, its US business, Giant Food Stores is set to open a new online pickup centre under a new brand, Giant Direct Powered by Peapod. The 3,530 sq m centre, located in Lancaster, Pennsylvania, will provide walk-up and drive-up collection for online orders.

Giant Food stores’ ecommerce business was previously known as ‘Peapod by Giant’. The change and creation of a new facility reflects Ahold Delhaize’s new go-to-market strategy for its ecommerce operations. It also marks the first dark-store conversion, helping to widen the brand’s delivery reach.

Giant Food Stores’s president, Nicholas Bertram, commented, “We are excited to make Lancaster the home of our newest innovation with the launch of our new Giant Direct, Powered by Peapod, ecommerce hub. Not only is the ecommerce hub a completely new concept for us and a first of its kind in our area, it’s the product of a fruitful collaboration… to give the Lancaster community the shopping experience they want and need”.

Jumbo City to offer deliveries in 45 minutes

Elsewhere in the Netherlands, Jumbo has partnered with local delivery start-up FoodDrop to provide its customers with home delivery in 45 minutes. Orders are placed online, prepared in-store and then delivered by FoodDrop on bikes for a cost of €2.95. Customers can choose from a limited assortment from the Jumbo City Groningen store. The range does not include crates of beer and prices are generally higher than in stores because of the fast delivery.

The service is initially available to customers living in a 2.5km radius of the Jumbo City Groningen store. It will be tested for an unknown period before being rolled out to the Groningen FoodMarkt and other Jumbo branches.

Source: Jumbo

Picnic to offer nationwide delivery on Sundays

Picnic has started to offer home delivery on Sundays. After a successful pilot in Ede, Utrecht and Veenendaal, Picnic extended the test to Almere, Delft, Leiden, The Hague and Zoetermeer. It has announced it will roll out the service nationwide in three weeks.

Picnic’s co-founder, Michiel Muller, commented, “The popularity of Sunday delivery is overwhelming. We have therefore decided to deliver groceries on Sundays in all 70 places where we are currently active. The weekend is the time to sit down with a shopping list to get what you need for the coming week. If you order before 10pm on Saturday, your order will be delivered on Sunday”.

To keep up to date with the latest news from the Netherlands, sign up to IGD’s free Retail Analysis international newsletter.

Ahold Delhaize has released its Q4 results, reporting that net sales increased by 3.0% at constant exchange rates to €16.6bn. Meanwhile net sales for the full year increased by 2.5% at constant exchange rates to €62.8bn.

USA Q4 net sales: +2.6% to €9.8bn

The retailer’s business in the USA, which accounts for around 60% of sales, saw Q4 net sales increase by 2.6% at constant exchange rates to €9.8bn.

Among the highlights, Ahold Delhaize called out Food Lion, which has now rolled out the “Easy, Fresh and Affordable” strategy to 70% of stores.

Netherlands Q4 net sales: +3.6% to €3.8bn…

Meanwhile in the Netherlands, Q4 net sales increased by 3.6% at constant exchange rates to €3.8bn.

 …Comparable sales growth strongest in the Netherlands

When considering comparable sales growth, the Netherlands was Ahold Delhaize's best performing market, both in Q4 and for the full year, growing at 6.0% and 4.5% respectively during these periods.

The retailer said that its supermarkets and online business, helped to drive this performance. Its new concept supermarket, Albert Heijn Hoofddorp, was shortlisted for the IGD Store of the Year Award 2018, with the format excelling in fresh execution and digital integration. IGD Retail Analysis subscribers can read the store visit report in full here.

…As Marit van Egmond appointed as Brand President and CEO of Albert Heijn

While releasing these results, Ahold Delhaize has appointed Marit van Egmond as Brand President and CEO of Albert Heijn as of February 1st. Van Egmond is currently EVP Commerce at Albert Heijn and has 20 years of international experience.

This will leave Wouter Kolk to focus on his role as CEO Ahold Delhaize Europe and Indonesia.

As part of the retailer’s new “Leading Together” strategy, “he will leverage digital, eCommerce and synergy opportunities across the different markets to drive growth and create new business prospects... He will be supported by a small team that is currently being recruited and will be announced shortly”.

Van Egmond commented, “It is an honour to lead Albert Heijn moving forward. I strongly believe that food plays a central role in how people live. This is key for the Albert Heijn brand with its strong heritage in food and our highly relevant position in society. Combined with the tech- and digital capabilities of Albert Heijn, we can help customers make informed choices to live a healthier and more enjoyable life”.

Belgium Q4 net sales: +3.6% as it implements new operational strategy

In neighbouring Belgium, Q4 net sales increased by 3.6% at constant exchange rates to €1.3bn. Here, the retailer acknowledged that implementing its new operational strategy helped to drive comparable sales growth of 3.0% in Q4.

Central and Southeastern Europe Q4 net sales: +3.9%...

In the Central and Southeastern European division, which includes sales in Greece, Romania, the Czech Republic, Serbia and Indonesia, Q4 net sales at constant exchange rates increased by 3.9% to €1.6bn.

During the year, the region accounted for most new store openings, with 130 net new openings, bringing the regional store to a total of 1,880.

Czech Republic: “very strong sales performance”

Ahold Delhaize highlighted that “the Czech Republic reported a very strong sales performance with successful promotions resulting in both increased transactions and basket size in supermarkets as well as in its compact hypers”.

Greece remains challenging

In Greece, comparative sales remained under pressure, with competitors re-opening stores. However, performance improved during the year, with the retailer achieving “slightly positive volume growth this quarter”.

Online 2018: +25.3% to €3.5bn, strongest performance in Netherlands

Online continued to grow at pace, with net consumer online sales increasing by 25.3% at constant exchange rates to €3.5bn for the full year.

The strongest growth and came from the Netherlands, which remains the retailer’s largest online market. Here net consumer online sales increased by 30.2% at constant exchange rates to €2.7bn.

A key driver of performance here was Bol.com, which saw a 32.3% increase in net consumer online Q4, achieving net consumer online sales of €2.1bn for the full year.

Meanwhile in the USA, net consumer online sales increased by 10.3% at constant exchange rates to €751m for the full year. In Q4, the retailer noted an improving sales trend, with net consumer online sales increasing by 12.1% to €203m. I

At its Capital Markets Day in New York in November, Ahold Delhaize revealed that it is targeting 30%+ growth in its US online business by 2020, driven by Peapod.

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