News & Insights > Insights > Post-pandemic and food ecommerce - new models and customer experiences

  •  By Anastasia Belugina

The sequence of confinements since 2020 and the health situation have led many French people to change their consumption habits and brands to adapt to the health crisis with new customer paths. In particular, home delivery services for meals and shopping are experiencing accelerated success: 13.5% of retail trade and 20% of restaurant sales are now delivered at home (Source : Antoine Lannuzel, France TV Info et Les Echos). The food e-commerce market is now estimated at 13 billion euros by 2025 (Source : Maddyness). And if for young people it was already a habit, 84% of 18-24 year olds have already used home delivery of food (Source: Food Service Vision), today the older and more affluent clientele is also getting into the act... 

Post-pandémie et ecommerce alimentaire - nouveaux modèles et expériences client

Today, over 50% of French people have already tried one of the food delivery services (Source : Cnews). Middle class populations, located in denser urban areas and accustomed to digital and e-commerce are also helping to attract new services and business models to major cities.

Before the Covid crisis, the historical brakes on home delivery were essentially still linked to a lack of trust (impossible to test, touch the products, especially fresh ones), the limited choice of products on the platforms, the habit of the "physical experience", the delivery time (not always practical), as well as the fear linked to the freshness and "durability" of the products received in delivery... 

September in Paris was marked by the arrival in the capital of Yango Deli, the new shopping delivery service launched by the Russian tech giant Yandex. After 5 cities in Russia and the recent launch in Tel Aviv, Yango Deli is now conquering Paris and London. What does it promise? Your fresh food shopping delivered in 15 minutes by bike or electric scooter. No minimum order unlike other services: Yango is banking on small, spontaneous and frequent purchases.

The logistics behind the ultra-fastness of start-ups such as Gorillas, a German unicorn, or Cajoo, a French start-up, are based on the model of "dark stores": a network of small distribution centres, inaccessible to the public, like the "dark kitchens" of restaurants that do not receive customers physically (for example: services such as Frichti, Nestor, etc.).

This promise, speed of delivery and reduced product offering, is the opposite of the historical players in food delivery, such as Houra: this service, which is already well known to the French, offers 50,000 references from all supermarkets (as opposed to 3,000 at Yango), and requires a minimum purchase. While Houra remains an online "hypermarket", Yango aims to position itself more like a "supermarket" in town, with the addition of local products.

Dark Stores new consumer habits
Local Commerce supported by new start ups such as Epicery

Aggregator's services, such as Epicery, initially a marketplace for local shops, are often supported by large companies, which allows them to benefit from their logistics and assortment solutions. Already backed by Monoprix, Epicery offers Franprix, Monoprix and Naturalia (from the Casino group) products on their site. In 2021, the La Poste group will take a majority stake (Source : LSA). The customer journey is less fluid than on sites such as Houra or the e-commerce of chains such as Carrefour and Leclerc, since the customer buys fruit and vegetables in one shop, fish in another and groceries in a third; but the model allows customers to support local shops and find fresh quality products without leaving their homes. As each shop has its own supply and delivery route, there is no promise of superfast delivery and a minimum order of €20 in each shop.

Another collaborative business model is that of Shopopop, a delivery startup from Nantes. The service offers to have your goods delivered by your neighbours: once you have paid for your locker in the shop of your choice, you choose the option of home delivery by Shopopop, and the nearest private delivery driver is notified.

Behind the multiplicity of these new offers lies the logistical challenge that weighs on the economic equations of the various models. According to the Capgemini study "The Last-Mile Delivery Challenge" in 2020, 97% of companies state that current last-mile delivery models are not sustainable everywhere and on a large scale, but only 1% of them are ready to assume the entire cost of last-mile delivery.

Today, two approaches are frequently observed by the players in this market:

Focusing from the outset on a large number of references and optimising the logistics cost through two tactics:
Shifting the logistics burden to partners or producers (such as Houra), as marketplaces most often do,
setting up facilitating partnerships such as Epicery did recently with La Poste or Pour De Bon with Chronofresh, or other product aggregators
Encourage short and ultra-local circuits, then progressively extend the offer to a regional or even national level, once a first threshold of performance and notoriety has been reached at local or ultra-local level
For example La Belle Vie 

Other optimisations deployed by some include the exclusion of ultra-fresh produce from the offer of specific distribution outlets ("dark stores" of Yango and Cajoo), or collection points in partner shops or at private homes, as in the case of Shopopop.

The changes in consumer behaviour brought about by the pandemic have given rise to a growing range of delivery services that are adapted to the new urban target (professionals or young families), who do not have time to shop but are looking for the right products.

  • Insights
  • Retail & e-commerce
Credit : Maria-Lin-Kim Unsplash

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