Can you keep up with a Gorilla?
Online groceries
It was disappointing to see that Kaufland (Schwarz Group) could not get the online grocery model in Berlin to work. They stopped deliveries at the end of 2017.
A lot has happened in the world of e-food since then. Not only in Germany. While established grocery retailers with bricks-and-mortar stores are fine-tuning their delivery services, others keep on experimenting and even more are just taking baby steps. The existing trend to shop online has been fuelled by the pandemic and is reflected in growing online grocery sales.
Who would have thought that discounter Aldi would ever deliver groceries to your doorstep? Hofer (Aldi Sued) is currently carrying out a test in Vienna and the sector is excited about the outcome. Will Aldi be able to make it work? If they roll this service out in other countries, it would have a major impact on online grocery sales. But there is no time to be wasted. Even though the share of online groceries is small in comparison to bricks-and-mortar sales – Germany bringing up the rear with only around 2% – grocery retailers cannot afford to focus only on the development of their existing delivery systems. They are building alliances and even taking a share in new players that take the concept of delivered groceries to the next level.
Q-commerce
They are sprouting like mushrooms: “Q-commerce” or on-demand grocery delivery services with funny names such as Gorillas, Getir, Flink, Knuspr or Grovy. A new name pops up virtually every week, promising to deliver groceries to your door within 10 minutes.
These new players have entered the market fighting hard for customers and market share. Quick-commerce is still a niche market within online groceries but investors see great potential. In 2021, € 6.7bn venture-capital was invested in these newcomers – a significant increase from € 400m in 2020. Germany, which is comparably underdeveloped in online grocery sales, plays a key role as the largest European market for the growth of Gorillas etc.
Opportunities all around
The latest format of on-demand grocery delivery creates new opportunities for retailers and industry alike. Q-player Knuspr (Rohlik) has recently started to offer Marks & Spencer products in Munich, bringing M&S food to Germany again after the closure of M&S department stores in 2001. Gorillas has expanded private label cooperation and works with Casino Group in France (focus on Monoprix and Franprix) and with Tesco in the UK. The level of opportunity to team up with fast moving Q-commerce certainly differs from country to country but potential exists everywhere. For example, several on-demand delivery services are currently still looking for exclusive brands or partners to further develop their private label portfolio, in particular regarding their drinks, vegetarian, vegan and fine food product ranges.
Business with such an agile on-demand delivery player across various countries can rapidly become more important than with your domestic customer that you have developed over many years. If you have not yet established contact to Gorillas & Co, don’t wait too long. You may miss a business opportunity and definitely want to have a foot in the door before this market segment starts to inevitably consolidate.
Shortly after the editorial deadline, this article may not be up to date anymore – the Q-commerce market will already have moved on…
Nicole Guenther
Managing Director, Green Seed Germany
nguenther@greenseedgroup.de