Can Coles & Woolies Survive Amazon’s Australian Arrival?

Can Coles & Woolies Survive Amazon’s Australian Arrival?
SHARE
THIS



With Amazon finally announcing its plans for the Australian market a new study has found the online behemoth may not be a shoe-in when it comes to the grocery side of the business due to Aussies’ reluctance to buy their groceries online.

 A study by Roy Morgan Research has found that although interest in buying groceries online was high (some 30 per cent of respondents), the fact was as little as three per cent of us actually do it.

So despite positive sentiment for the idea, shopping for groceries online still remains niche in Australia. The question is -will the introduction of high-speed grocery delivery service AmazonFresh change that?

News that Woolworths has established a special task force to address this threat is no surprise: Woolworths customers are marginally more likely to do their grocery shopping online (4.2 per cent doing so in an average four weeks) than those who mainly shop at Coles (4 per cent), ALDI (1.4 per cent) or IGA (1.2 per cent).

Supermarket customers who buy groceries online vs those who’d consider it

7223-chart

 

 

That said, grocery-buyers who mainly shop at Coles are more likely to consider doing some of their grocery shopping on the internet in the next 12 months (32.1 per cent) than those who mainly shop at Woolworths (30.6 per cent), ALDI (28.5 pr cent) and IGA (19.6 per cent).

But does this mean that the local supermarket scene is going to be destroyed? Not necessarily. Roy Morgan’s recent Retail-focused State of the Nation report highlighted certain industry trends that may well work in supermarkets’ favour, even once Amazon hits town.

  • As mentioned, the long-standing gap between consumers who say they’d shop for groceries online and those who actually do it suggests that immediate mass uptake of AmazonFresh is unlikely.
  • Australians are making more visits to bricks-and-mortar stores, at least partly due to the growing ‘retailtainment’ trend, whereby their shopping experience is enhanced with an extra entertainment element. Savvy supermarkets are already tapping into this with such add-ons as in-store cafés, tastings or cooking demonstrations: something an online grocery service cannot compete with.

Commenting on the findings, Roy Morgan CEO, Michele Levine, said: “Online grocery shopping is not widespread in Australia yet, but the arrival of AmazonFresh looks set to up the ante with its quick-delivery, low-priced service.

“It’s worth noting that customers who mainly shop at Coles or Woolworths are more likely than the average grocery buyer to be Technology Early Adopters, and as such, more open to radical new e-commerce propositions such as AmazonFresh.

“But the threat of AmazonFresh is not just about technology, it’s about competitive pricing, service and real estate. With heated price wars already characterising the current Australian supermarket scene, a new player of this magnitude will undoubtedly appeal to grocery shoppers, especially when Amazon CEO Jeff Bezos has already declared, ‘Your margin is our opportunity’.

“Meanwhile, as traditional supermarkets reduce the range of brands they stock in favour of a greater selection of home brands, the sheer diversity of brands available on AmazonFresh may also appeal to shoppers.

“The incumbents, however, have the advantage of physical locations within easy reach of every shopper. Although Amazon is venturing into the offline space, with its first cashier-less, bricks-and-mortar Amazon Go grocery store currently operating in beta-mode in Seattle, it remains some way off rolling out these stores in Australia. This advantage will buffer local supermarkets while they gauge and respond to the impact of AmazonFresh’s arrival.”

Please login with linkedin to comment

Latest News

Image lead story UnLtd’s ‘Big Clash’ Raises Over $120K, With Media Owners & Media Agencies Crowned Champions
  • Advertising
  • Media
  • Technology

UnLtd’s ‘Big Clash’ Raises Over $120K, With Media Owners & Media Agencies Crowned Champions

With over 50 companies taking part, the fourth annual Big Clash cricket tournament has been the biggest yet, raising $124,000. The event once again brought the industry together for a great afternoon of cricket, drinks, music, and charity activations. This year, the event was expanded to have Media Owners, Media Agencies, Techies and Creatives all […]

SCA’s Profit Drops 21% Due To “Years Of Heavy Lifting”
  • Media

SCA’s Profit Drops 21% Due To “Years Of Heavy Lifting”

Southern Cross Austereo (SCA) has experienced a negative first half of the 2018 financial year, posting a dramatic drop in overall profit and a slight drop in revenue. The group’s net profit after tax fell 21.2 per cent to $48.5 million in the six months to 31 December 2017 (compared to the previous corresponding period), […]

by B&T Magazine

B&T Magazine
Lord Of The Fries Pays Homage To Kanye West & Kendrick Lamar In Clever Ads Via Milkman
  • Advertising
  • Campaigns

Lord Of The Fries Pays Homage To Kanye West & Kendrick Lamar In Clever Ads Via Milkman

Creative digital agency Milkman has helped Lord of the Fries (LOTF) pay homage to two of the fast food outlet’s favourite artists through a series of clever art poster adverts. Milkman re-created the latest album covers of Kanye West and Kendrick Lamar with a LOTR vibe to highlight the brand’s hip-hop roots and its favourite albums […]

Keep Left Wins PR Account For Greening Australia
  • Marketing

Keep Left Wins PR Account For Greening Australia

PR and content marketing agency Keep Left has been selected by proactive conservation organisation Greening Australia to raise public awareness of its flagship programs and national footprint. The relationship began in 2017 when Greening Australia engaged Keep Left in support of Reef Aid, a project launched with corporate partner Virgin Australia to improve water quality […]

Now Screen Repositions Organic Care Brand With New Campaign
  • Advertising
  • Campaigns

Now Screen Repositions Organic Care Brand With New Campaign

Aussie agency Now Screen has teamed up with Organic Care to reposition the brand in what has become one of the most competitive FMCG spaces. The new campaign, ‘Caring Comes Naturally’, celebrates what Organic Care has created since its inception: products that are as good for your body as they are for the environment. In […]

Can You Speak Data?
  • Marketing
  • Opinion

Can You Speak Data?

We're certainly fluent in gibberish, balderdash and claptrap here at B&T, but sadly data isn't part of the lexicon.

Opinion

by B&T Magazine

B&T Magazine
Social Change Maker Profile: Emma Heath
  • Advertising
  • Marketing
  • Media

Social Change Maker Profile: Emma Heath

B&T has partnered with UnLtd to showcase industry heroes! Well, it's arguably more heroine in the case of Emma Heath.

by B&T Magazine

B&T Magazine
Ad Fraud: A Problem We Can Solve
  • Advertising
  • Opinion
  • Technology

Ad Fraud: A Problem We Can Solve

Unlike B&T's mystery office farter, this columnist argues ad fraud is a problem that can possibly be solved.

Opinion

by B&T Magazine

B&T Magazine
Why We Pivoted Our ‘Specialist’ Agency Five Times In 15 Years
  • Marketing
  • Opinion

Why We Pivoted Our ‘Specialist’ Agency Five Times In 15 Years

In this opinion piece, Gavin McDonough (pictured above, co-founder and managing partner of Urban, shares through his own experience some valuable advice for independent specialist agencies. In November 2017, my brother Ryan and I celebrated 15 years in business. We started business out of my front room in Melbourne in 2002 – not with any grand […]

Opinion

by B&T Magazine

B&T Magazine
W+K’s Susan Hoffman Chosen As 39th AWARD Awards Chair Of Judges
  • Advertising

W+K’s Susan Hoffman Chosen As 39th AWARD Awards Chair Of Judges

Susan Hoffman, co-chief creative officer at Wieden+Kennedy (W+K), has been appointed chair of judges for the 39th AWARD Awards. Known to challenge the status quo, Hoffman is behind some of W+K’s most memorable and game-changing ads, including Nike’s ‘Revolution’, Old Spice’s ‘The Man Your Man Could Smell Like’ and Chrysler’s Super Bowl spots starring Eminem and Clint […]

Experiential Agency Kreate Gets Bought Out By Staffers
  • Marketing

Experiential Agency Kreate Gets Bought Out By Staffers

Leading experiential marketing agency, Kreate Australia is embarking on an exciting growth strategy following its purchase by three of the agency’s existing management team from its UK founder, Steve Evans.

Hurry! B&T 30 Under 30 Entries Closing Friday!
  • Advertising
  • Marketing
  • Media

Hurry! B&T 30 Under 30 Entries Closing Friday!

This is a clarion call for B&T 30 Under 30 entries, although it's probably more mariachi band than angelic harbinger.

by B&T Magazine

B&T Magazine
The Hit Network Chooses Comedian Tanya Hennessy To Host Weekend Breakfast
  • Media

The Hit Network Chooses Comedian Tanya Hennessy To Host Weekend Breakfast

Southern Cross Austereo’s Hit Network has announced that rising radio star and comedian Tanya Hennessy will take over hosting duties for its weekend breakfast slot in 2018. Hennessy will bring content to the airwaves each Saturday and Sunday morning from 7am to 9am with a regular rotation of guest co-hosts. The self-described talker, not walker […]

Straight Up PR Wins Five New Clients
  • Marketing

Straight Up PR Wins Five New Clients

Health, wellbeing and lifestyle PR agency Straight Up PR has welcomed Changing Habits, Unichi Wellness, enerGi, SleepX, and Healthie Hampers to its client portfolio. Straight Up PR’s projects will include bespoke PR services and influencer marketing packages specifically focusing on communications strategy and execution, media and influencer relations, PR launch events, product seeding and gifting, […]

March One Creates ‘Cheese For Change’ Fundraising Campaign For White Ribbon Australia
  • Advertising
  • Campaigns
  • Marketing

March One Creates ‘Cheese For Change’ Fundraising Campaign For White Ribbon Australia

Independent creative agency March One has developed a new fundraising event for White Ribbon Australia that turns a social moment into a social movement. Starting on Thursday 22 March and going until Sunday 25 March, Cheese for Change will ask Aussies to create a cheese platter that matters by gathering friends, family or co-workers together […]

Sixth Annual IGN Select Awards Winners Announced
  • Marketing

Sixth Annual IGN Select Awards Winners Announced

The winners of IGN Australia’s sixth annual Select Awards were revealed during a huge special event at the Australian National Maritime Museum in Sydney on Friday, February 16. Some 225 Media & Game Publishers alongside 320 IGN Community Gamers attended the annual event. 2017 was absolutely crammed with terrific games and several categories were extremely tightly-contested. The top […]

Meet Your Mentors For B&T Bootcamp 2018!
  • Advertising
  • Marketing
  • Media

Meet Your Mentors For B&T Bootcamp 2018!

When it comes to an industry "who's who", you'll find there won't be too much who-ing with this impressionable lot.

by B&T Magazine

B&T Magazine
ANZ Unveils Its 2018 GAYTMs
  • Marketing

ANZ Unveils Its 2018 GAYTMs

Mardi Gras is only weeks away and B&T has already hoisted the mirror ball and donned the hotpants to bring you this.