Coop Alleanza 3.0 vs Amazon: Fresh food, served online

15/03/2017
In brief
2017 will be the year in which e-grocery products exceed 1% of all fast-moving consumer goods purchased in Italy. More tellingly, e-grocery was responsible for 25% of the grocery sector's total growth, which this year stood at 0.9%. Online consumers are not just spending more online - they are also buying more groceries in general: 6.8%, between 7 and 8 times the overall market growth rate. Coop Alleanza 3.0 aims to make a decisive move in the war against Amazon.
The latest gamble by Coop Alleanza 3.0 is online grocery shopping: in Italy, this digital commerce sector saw spending of 575 million euro in 2016, up 30% from 2015. While these numbers still do not match the sector’s performance across Europe and worldwide, the rate at which it is growing represents a real opportunity in the world of digital commerce. 2017 will be the year in which e-grocery products exceed 1% of all fast-moving consumer goods purchased in Italy. More tellingly, e-grocery was responsible for 25% of the grocery sector’s total growth, which this year stood at 0.9%. Online consumers are not just spending more online – they are also buying more groceries in general: 6.8%, between 7 and 8 times the overall market growth rate. Coop Alleanza 3.0 aims to make a decisive move in the war against Amazon, and as such it is the first retailer to take a major step down the route of selling fresh produce online (in London, Amazon Fresh has quickly found favour with consumers who have access to 130,000 different items and guaranteed delivery times of less than an hour). The company is hoping to follow in the successful footsteps of Walmart, which now holds 40% of the online food shopping market thanks to its timely investments.

Moreover, the market for Coop Alleanza 3.0 has changed for good. The spending crisis and new buying habits have forced it to abandon its strategy of opening a new 12,000 m2 site and focus on alternative models of store size and location. It has also expanded into previously uncharted business areas such as lighting, gas and fuel. Now, with the new EasyCoop portal, it is the turn of online food. In order to compete with Amazon, which has focused its Italian operations on Milan, Coop Alleanza 3.0 is starting with Rome, backed by a catalogue of 10,000 products (3,000 of them fresh). Through one of its subsidiaries, Coop Alleanza already has 31 stores in Rome. It is now adding a “dark store” of 3,000 m2 to handle the comings and goings of online products. When it comes to online shopping habits, including overseas, 40% of shoppers’ virtual trolleys are taken up by products to be consumed immediately, such as meat, fish and vegetables. Coop is not distancing itself from this ratio in its forecasts. The online shop is open 24 hours a day, and packages are delivered the day after the order is placed, with the option of specifying a one-hour window for the delivery and receiving a photo of the courier who will deliver the goods via SMS. EasyCoop is just a small sneak preview of the 2017-2019 industrial plan, which aims to reach global sales of 5.9 billion euro (+27%). In order to do so, the company will make major investments (€875 million over the three-year period), sell off non-strategic properties, and make cost-efficiency savings and operational decisions (in Calabria, Coop Alleanza 3.0 has taken over 34 supermarkets from the French retailer Auchan).