Improved delivery services, faster fulfilment and more competitive prices are the weapons with which the war for online grocery retail is being fought.
With the likes of HelloFresh and Kogan breaking into the local home-delivered grocery offerings, it falls on the incumbent services to innovate or perish. Two Melbourne businesses are looking to do just that.
On-demand delivery service Swift has partnered with online grocer GroceryButler, pledging to deliver their goods within an hour as a competitive edge against the likes of Woolworths, Coles, and a host of other rivals.
“The future of e-commerce will see bricks and mortar stores become the dispatch warehouses,” Swift Founder Joel McDonald told Business Insider, continuing that the key trend in online retail would become faster, cheaper deliveries. “The GroceryButler partnership highlights that fast response to demand at an affordable price, which can only be achieved with retail store warehouse dispatching.”
This newest partnership comes as a number of big-time players have set up shop in Australia, including German-based HelloFresh with the backing of capital group Rocket Internet, as well as major Australian retailer Kogan.com branching into the grocery market, all looking for a piece of the $2 billion Australian grocery market.
Grocery Butler Managing Director, Michael Parthenides, said both companies are excited to deliver value to the consumer in comparison to current grocery delivery options in Australia.
“We are all about speed and convenience. The alliance with Swift will enable us to expand into new territories, and that means more people can experience the benefits of our 60 minute grocery delivery service,” he said.
The faster delivery through GroceryButler is available in Melbourne, Sydney and Brisbane with national ambitions to follow. Swift also provides the delivery network for Macdonald’s other brainchild, proof-of-concept home delivery service Liquorun.
In response to the new blood, the major players are shaking up their game too. Woolworths has recently adopted a new price-parity policy regarding its online and offline stores, shaving as much as 7 percent off online store prices on products. In addition, Woolworths has just been outed at an Apple press conference as one of the first Australian brands to get access to the new Apple Watch.
Kogan is also competing on price, with claims made earlier this year that groceries could be up to 50 percent cheaper with Kogan Pantry than the major competitors.
Power Retail has reached out to other entrants in the field, to find out how they are managing the newly heated competition.