M&S mulls online grocery delivery

UK retailer Marks & Spencer is said to be mulling a trial online grocery delivery service this autumn.

According to The Guardian newspaper, chief executive Steve Rowe told company managers last week the retailer was planning to launch a soft trial for how it might provide such a service in the autumn.

The retailer is thought to have re-evaluated its stance on online retailing, given the popularity of its own food offer, and success of other supermarket online operations – even though few are thought to make a profit through e-commerce.

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“It has not cost us anything over the last five years by not being online with food. Our customers haven’t moved yet, but they will and we need to ensure that we are ready with the right response,” Rowe is reported to have said. “There are unanswered questions over what this means for M&S and we have a team looking at this now with a view to undertaking a soft trial in the autumn.”

Rowe also added that the “economics of food online” were not straightforward and it was not something the retailer would rush into “until we have substantial customer insight and a better understanding of what is right for M&S and right for our customers.”

Retail analysts the IGD have forecast that changing consumer behaviour and the rise of new competitors such as Amazon and Deliveroo have boosted customer expectation, which is also helping to accelerate online grocery sales. It has said this trend will be continue to grow, and online will account for around 9% of total grocery sales by 2021, up from 5.8% now, to around £17.2bn.

“With the food business proving a success, M&S is now looking to expand it and realises it can no longer ignore online grocery, or it is at risk of losing market share and falling behind,” retail analyst Holly Browne said.

The retailer already operates an e-commerce service for its wines by the case, with a 1000-strong range, including more than 400 wines exclusive to web sales, and free delivery on orders over £50 and free next-day delivery on orders over £100, as well as party food, clothes, homeware, flowers and other non-food items.

Last month the retailer confirmed it was opening another 34 food shops following a review of its UK store portfolio to concentrate on its profitable food business, that was announced in November.

The new stores will be in areas such as Bishopsgate in the city of London, Huntingdon, Aylesbury, Spinningfields in central Manchester, and Strood in Kent, with a further six shops being closed or relocated, two of them Simply Food stores.

At the time, Rowe its stores would always be an integral part of its customer offer and would work “seamlessly” alongside the website, but that customers’ shopping habits were changing.

“Picking up food for now or tonight rather than doing one big shop or browsing and shopping online and collecting in store are great examples of this and we are committed to adapting our business so that we stay in tune with our customers,” he said.