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Hungary’s competition authority (GVH) has approved MediaMarkt’s acquisition of Tesco’s electronic business in nine of its stores. Although this impacts a small number of its 112 hypermarkets in the country, there are clear benefits to be gained by both retailers.

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Tesco has announced the appointment of Christine Heffernan as group communications director. She will take up the role on March 2019 and join the Executive Committee, replacing Jane Lawrie who leaves Tesco after 2 1/2 years in the role.

Strong track record at Tesco Ireland

Heffernan has most recently worked as Executive Director to Group CEO Dave Lewis. Prior to that she spent five years as Director of Corporate Affairs in Tesco Ireland, as well as a board director and member of its senior leadership team. In these roles, she worked as part of a team transforming the Irish business and its communications to rebuild trust in the brand.

Experience across sectors

Heffernan has communications experience across a number of sectors including energy, telecoms and financial services. Previously, she has worked at the European Parliament and as a policy advisor at the Treasury in London, experience that could prove valuable for Tesco's Brexit preparations. Heffernan has also been a board member of Threshold, Ireland’s national housing charity, since 2013.

Leading the drive to build trust in the Tesco brand

Commenting on the appointment Group CEO Dave Lewis said: “I’m really pleased to welcome Christine to the Group Comms Director role. She brings a wealth of experience and business insight to the role, as well as energy and deep communications expertise. Strengthening our communications and building trust in our brand are key priorities for us and I look forward to Christine’s leadership in achieving those objectives.”

 

IGD Tesco Business Update 2019

8 May, London

Dave Lewis and his leadership team invite you to a crucial supplier event to help you stay close to Tesco’s strategic vision in its centenary year.

Find out more »

The ‘last mile’ has become an increasingly competitive place, as the food industry and disruptors continue to create solutions that make online shopping even more convenient. We know that the convenience and ease of online shopping is extremely appealing to shoppers.

We’ve identified several examples of last mile solutions that help online shoppers embrace this convenience.

Increase in unattended in-home delivery

During 2018, we saw numerous leading global retailers trialling unattended in-home delivery services.

The customer grants access to a delivery driver using smart lock technology, by setting a temporary access code for the lock, which is then sent to the delivery driver via a secure app. Refrigerated and frozen goods are put away by the delivery driver, and other groceries as instructed by the customer. A video of the whole delivery is often available.

Edeka, Waitrose & Partners and Albert Heijn all joined Walmart, Amazon, Jet.com and ICA with trials in their respective markets.

There is a significant amount of trust required on the behalf of the shopper to sign up to such trials. However, if the service delivers and meets shopper expectations it is hard to see a more convenient and easy way to shop online.

There are also benefits for retailers. For example, they can optimise delivery routes to save time and fuel costs, as they will not be delivering based on predetermined hourly delivery slots.

There will be no need to compensate for late deliveries, and they may be able to process the order faster at the shopper’s home, as there will be no ‘meet and greet’ of the shopper.

It also enables them to better use delivery vehicle capacity.

Robot deliveries

Delivery by robots is another last-mile solution that retailers and disruptors are trialling, and showcasing.

JD.com’s driverless delivery vehicles have been deployed in the cities of Changsha and Hohhot (inner Mongolia) in China. The unmanned vehicles can carry 30 items and deliver them within a 5km radius.

The vehicles can plan routes, avoid obstacles and recognise traffic lights. Facial recognition technology enables users to easily and securely collect their parcels. Running at full capacity, the delivery stations, operating with a half-half split between robots and couriers, can deliver up to 2,000 packages a day. See JD.com's robot in action >>

Tesco customers in Milton Keynes, UK, can now have their groceries delivered by robot.

The service from robotics company Starship Technologies, is available via a Tesco Extra in the Kingston Centre.

This follows Tesco’s trial in London with Starship during 2017, in which it tested robot delivery as part of a wider ‘Tesco Now’ one-hour delivery trial.

Starship Technologies currently also delivers hundreds of orders a week for a Co-op branch in Milton Keynes. Local customers have reacted positively. See Starship Technology's robot in action >>

Autonomous vehicles

Walmart is partnering with Udelv to test its autonomous delivery vans in Surprise, Arizona.

The pilot will see a cargo van customised to support Walmart’s grocery delivery operation.

The trial will begin in February 2019, and will initially involve human backup drivers until both companies and regulators believe it’s safe to remove the driver.

The test will build on Walmart’s existing self-driving vehicle pilots. These include a program with Ford and its delivery partner Postmates, and a similar initiative with Waymo, Google’s self-driving project.

The company behind Walmart’s ecommerce pickup towers has developed a self-driving vehicle that could revolutionise last-mile delivery.

The vehicle, called Lotte, is a robotic courier.

It can autonomously transport goods to a predesignated location, and using a robotic arm it can allegedly place goods in a pickup locker. It claims to be one of the only self-driving delivery vehicles that can complete deliveries without any human intervention. See Lotte the robot courier in action >>

Delivery by drone

JD.com, China’s largest retailer, has completed Indonesia’s first government-approved drone flight – a breakthrough for drone delivery in Southeast Asia.

The successful pilot opens the door for commercial drone use in Indonesia and the Southeast Asia region, subject to further regulatory approvals.

Indonesia is a challenging country for ecommerce deliveries, given the fact it’s spread out across many islands. JD.com will be able to provide more efficient, reliable services by regularly using drones. And it will help the retailer realise its goal of delivering 85% of orders on the same or next day.

JD.com plans to build 150 drone launch sites in southwestern Sichuan province of China for unmanned aerial vehicle parcel deliveries. JD.com has been developing its drone capabilities since October 2015, and claims that drone deliveries would reduce the cost of shipping freight by 70%, compared to conventional truck delivery. See JD.com's drone in action >>

Wing, a drone delivery company that is part of Alphabet (Google), will start a pilot initiative around Helsinki, Finland, in the spring of 2019.

In September 2016, Wing delivered burritos to students at Virginia Tech in what was, at the time, the largest and longest drone delivery test in the US.

Food is a great test case for drone delivery technology because it can be fragile and temperature sensitive and therefore needs to be delivered quickly and carefully.

Where next?

Shoppers’ expectations are continuously increasing when it comes to getting the goods they want in a quick and easy way. So far, retailers have been able to meet and often reset these expectations with innovative delivery solutions.

We expect to see more competition amongst retailers to get goods to shoppers in more innovative and creative ways. The online channel and technological advances have created most of the solutions to meet shoppers’ desire for increased convenience. However, many retailers still face a challenge of delivering fresh produce to customers at a reasonable cost.

These pilots will help retailers to better understand the future of delivery and the role of these vehicles in a broader mix of fulfilment options.

Do you need an insight report, presentation or workshop on global trends and innovations in retail?

Toby Pickard, Head of Insight – Innovation and Futures

I head up IGD’s insights research on innovations and futures, and analyse the impact they could have on retailers, suppliers and shoppers. I regularly work with leading retailers and manufacturers to create content and insights focusing on the future of retail.

Please contact me: [email protected]

Toby Pickard

Toby Pickard

Head of Insight – Innovation and Futures

Global retail trends 2019

What’s shaping the global retail market over the next 12 months and beyond?

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Britain's overall grocery market growth was slightly higher at 1.7% in the 12 weeks to January 27th than the 1.6% growth we saw over the Christmas period, according to the latest data from Kantar Worldpanel.

Sales declined by £1.5bn from December, however this was expected as shoppers made the inevitable cut backs after Christmas. Inflation remained the same at 1.3%, implying a small amount of growth in volume.

Changing shopper preferences

January's growth was driven by the strong performance of fresh produce. This came at no surprise after retailers fully embraced the Veganuary trend this year. The industry is responding to the changing shopper preferences for more specialist diets by promoting a more plant-based diet. Our stand-out executions of Veganuary can be found here.

This was a continuation from the growing health-based trends we saw in 2018. One in three shoppers now say they are interested in or are following a vegetarian diet and one in six a vegan diet. Subscribers can find out more about these trends in our  UK retail and shopper trends Q1 2019 report.

Dry January affected alcohol sales over the period, showing shoppers are continually looking for ways to be healthier. Although sales of alcohol were +10%, this was driven by a very strong new years eve. If this day was taken out spending would be -2.9%.

Discounters continue to grow

Discounters continue to perform well with Aldi leading the way as the fastest growing retailer at +9.1% sales growth. This pushed its market share up to 7.5% from 7.0% a year ago. Kantar has shown that the average spend in discounters is rising. In the previous 12 weeks it has risen £8 to £204. We expect this growth to continue as shoppers remain budget conscious in the new year period.

Tesco fastest growth since September

Tesco's growth was the best of the big four at 1%, an encouraging result for the retailer as it enters its centenary year. However, Tesco remains a business under pressure as evidenced by last week's announcement to reduce staffing at counters as part of its drive to become more competitive.

Continued good performance from Co-op

The Co-op achieved good growth over the Christmas period of 3.2%. This positive performance continue in January with growth of 3.5%. It was the only non-discounter to gain market share, increasing to 5.9%. The retailer is capitalising on its good run of performance, investing in its estate with plans to open 100 stores in 2019.

Other good performances

After 11 successive periods of growth Iceland's positive performance continues as it grows 2.3%.

Asda saw double digit growth in its online sales, contributing to its growth of 0.7%. More details of this will be available when the retailer releases its full results on February 19th. Its market share did however decline 0.2% to 15.3%. The CMA is also likely to reveal whether and on what terms its acquisition by Sainsbury’s can go ahead later this month.

Waitrose saw better results after a disappointing Christmas of slow growth at 0.2%. We have recently seen the retailer continue to make changes to its senior management team. Going forwards it is focusing on differentiating its product proposition to improve results.

 

12 weeks to 28 Jan 2018 (% share)

12 weeks to 27 Jan 2019 (% share)

Sales growth (Y-o-Y %)

Tesco 27.9 27.7 1.0
Sainsbury's 16.3 15.9 -0.3
Asda 15.5 15.3 0.7
Morrisons 10.8 10.6 0.4
Aldi 7.0 7.5 9.1
Co-op 5.8 5.9 3.5
Lidl 5.0 5.3 7.3
Waitrose & Partners 5.2 5.1 0.2
Iceland 2.3 2.3 2.3
Ocado 1.1 1.1 1.0
Other multiples 1.6 1.7 5.5
Total symbols & independents 1.6 1.5 -4.1
       

Source: Kantar Worldpanel

 

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IGD Live 2019

6-7 November, London

Super early bird offer! IGD Live combines our channel events under one roof, giving delegates the opportunity to attend a channel specific area, or to create their own bespoke programme.

Find out more »

 

Presentations

An essential summary presentation of trading priorities, latest developments, and other key commercial insights for Tesco. Also includes a checklist to trade with Tesco.
Central and Eastern Europe is a region that illustrates great growth potential for both retailers and suppliers. The region also presents opportunity for retailers to evolve their business model to widen their shopper base and draw more traffic to their stores.
Tesco customers in Milton Keynes can now have their groceries delivered by robot.
View all presentations

Key presentations

We explore progress made against Tesco’s strategic objectives in its H1 results and present our global forecasts for 2018-2023.

This in-depth guide to the United Kingdom explores the key trends in grocery retail and the growth strategies of the leading retailers in the country.

An essential summary of trading priorities, latest developments, and other key commercial insights for Tesco.

8 May, London
Dave Lewis and his leadership team invite you to a crucial supplier event to help you stay close to Tesco’s strategic vision in their centenary year. 

We've developed a single, universal methodology for calculating food and consumer goods retail data, supported by our programme of primary and secondary research. This makes Retail Analysis the most reliable and robust source available for data of this type. 

Get the latest industry news and insights straight to your inbox with our range of newsletters.

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

We've grouped all the latest European retail news, store visits, retailer profiles and downloadable presentations together in one place.