Migros online subsidiary grows by 6,6% in 2015 with 40% of all orders placed via mobile devices
In 2015, sales at the Migros online supermarket grew by 6,6% or CHF 11 million, with customers spending a total of CHF 176 million at LeShop.ch. Switzerland’s largest online supermarket saw revenues increase for the third consecutive year. This growth was driven by smartphone and tablet orders, the expansion of the delivery service and more precise delivery times.
Retailing in 2015 was affected by the strong Swiss franc: many Swiss consumers purchased groceries abroad, and around 10% of Swiss retail trade sales, CHF 11 billion, flowed out of the country, according to estimates by Credit Suisse. The entry of foreign e-commerce portals into the Swiss market put further pressure on prices.
LeShop.ch, however, is delighted to report excellent end-of-year results and record sales: in 2015, grocery sales at the Migros subsidiary reached CHF 176 million, which constitutes an increase of 6,6% or CHF 11 million over the previous year. LeShop.ch’s annual sales have risen for the third consecutive year, confirming the current growth trend. A key contributing factor was the increased use of smartphones and tablets among all age groups – more than 40% of orders on LeShop.ch are placed using mobile devices.
More precise delivery times and new collection points
Growth was also driven by the expansion of services for LeShop.ch customers: in June 2015, in collaboration with Migros, the online supermarket began a pilot scheme involving eleven PickMup collection points in Migrolino stores and Migros shopping and fitness centres. Online customers can collect their pre-packed groceries at these locations the day after placing their orders. As Ernst Dieter Berninghaus, head of trade at the Migros Cooperative Association, says, “Experience shows that the more closely we succeed in integrating our online and offline services, the more loyal our customers will be. Customers who shop in our stores as well as using the home delivery and collection services buy more than twice as much as «classic» store shopper. This is why we as a group are focusing on this cross-channel strategy.”
Furthermore, in October LeShop.ch introduced more precise delivery times: in over 40 Swiss towns and cities, customers can now choose between significantly narrower delivery windows. In these locations, LeShop.ch delivers in the morning between 9 am and 12 am, between noon and 2 pm and between 2 pm and 5 pm in the afternoon. In Zurich, customers can even choose between four additional 1½ hour delivery windows between 4:30 pm and 9 pm. This has allowed LeShop.ch to reach new customers. Offices and nursery schools, for example, have their shopping delivered in the morning, while those who work during the day use the evening delivery window. At the same time LeShop.ch was as the first online supermarket in Switzerland to launch nationwide home delivery on Saturday mornings from 9 am. Continued strong performance at the two LeShop.ch DRIVE collection stores, located in Studen (Bern) and Staufen (Aargau), further contributed to growth in 2015.
Rapid growth predicted in the online grocery trade
In Switzerland, the market for online grocery shopping is far from saturated. E-commerce experts at Credit Suisse are forecasting strong growth in this area over the next few years: in their study, Retail Outlook 2015, they predict that the proportion of grocery shopping carried out online will double from 1.7% to 3.5% by 2020. LeShop.ch’s CEO, Dominique Locher, says, “A large part of the market is still unclaimed, and everyone wants the biggest piece of the pie. In these conditions, we can gain new customers by providing fast and precise services and undertaking cross-channel initiatives in collaboration with Migros.” A quick glance at other countries shows that the market for online grocery shopping is booming: in England, France and Germany, a number of companies are preparing to enter the market, including online giant Amazon with its AmazonFresh service.
LeShop.ch — results 2015
* Collective delivery by LeShop.ch as compared to private shopping trips in a car
** For the month of December