Morrisons plans online launch, as sales to soar

02-Dec-2013 - Last updated on 16-Dec-2013 at 11:15 GMT

Morrisons expects to serve 50% of the UK's homes by the end of next year

UK online sales of food and groceries are set to more than double in value to reach £14.6bn by 2018, while Morrisons recently unveiled plans to launch online deliveries next month.

Grocery think tank IGD predicted a 123.7% increase in online grocery sales from their current value of £6.5bn. The rapid growth is in sharp contrast to the overall grocery market, which is predicted to grow by 21.3% over the same period.

More than a quarter (26%) of shoppers reported buying food and groceries online in October, compared with about 20% three years ago, according to IGD ShopperVista research. Moreover, 11% of grocery shoppers said buying online was their main way to buy groceries, a rise of 4% on the figure three years ago.

31%

Nearly a third (31%) of online grocery shoppers had bought food and groceries online recently using a smartphone or tablet.

In selecting an online grocery retailer, 81% of shoppers named product quality as one of the top deciding factors, followed by delivery and available delivery slots.

Meanwhile, online shoppers are often disappointed with the freshness of food delivered by existing services, claimed Morrisons, based on recent research.

Four areas

The retailer pledged to pay particular attention to four areas: freshness, availability, value and convenience. Morrisons will use its £200M distribution partnership with Ocado to deliver its first online-ordered food products in Warwickshire on January 10.

The retailer has committed to a one-hour home delivery slot and promised that shoppers will be able to check the freshness of produce on their doorstep. “If customers don’t like the freshness of the food, Morrisons will take it back and will take no payment for the item as well as sending a voucher to the same value within 24 hours,” it said.

Morrisons’ chief executive Dalton Philips acknowledged that the retailer was late to start an online grocery service but pledged that next month's launch would “make an entrance”. The retailer expects to serve 50% of the UK's homes by the end of next year. Tesco, Sainsbury and Asda have been developing online sales since the late 1990s.