Many UK consumers think of Amazon pioneering ecommerce, leaving UK brands slow to catch up. But the e-commerce delivery expert ParcelHero says Tesco’s launch of UK nationwide deliveries before Amazon is no surprise; as Tesco was the first company ever to ever sell online.
ParcelHero’s head of consumer research, David Jinks, says: “In May 1984, in Gateshead (a town in Tyne & Wear, England) the world’s first recorded online home shopper, a 72-year-old grandmother named Mrs Jane Snowball, purchased groceries from her local Tesco store – in the world’s first ever online shopping transaction from the home.
“Mrs Snowball’s name proved prophetic as the new form of retail snowballed. From this humble beginning, the internet has been encroaching on the retail market, (ironically including Tesco’s supermarkets); and e-commerce is now becoming so established and convenient that the familiar High Street supermarket could vanish far sooner than anyone expects.”
Tesco’s has never lost its enthusiasm for e-commerce. In 2016 it was the largest UK-owned business selling online, and second only to Amazon in internet sales – Tesco’s selling £2.9bn of groceries and products online, against Amazon’s £4.4bn.
Jinks said: “Tesco’s has never held back in pushing new sales technologies, and it really is no surprise it has beaten Amazon to the punch in enabling same day deliveries to around 99% of UK households. And it’s stolen a trick from Amazon in encouraging all-important customer loyalty by not, at first, charging for deliveries for members of its Amazon Prime-style delivery membership scheme, Delivery Saver.”
Same day deliveries are proving increasingly popular with Tesco seeing an 18% growth in demand for the service so far this year.
But Jinks sounds one note of caution: “Amazon teamed up with Morrisons and has no supermarkets of its own to cannibalise sales from; but Tesco’s has over 6,500 stores. Every online grocery sale could be seen to be eating its own lunch. Of course, its huge number of stores are what enables Tesco to reach 99% of UK households; but longer term the growth in home deliveries must endanger some of its own stores, particularly large out-of-town supermarkets, as home deliveries wipe out the dreaded weekly groceries shop.”
ParcelHero’s full report into the impact of e-commerce on the UK High Street is available online at https://www.parcelhero.com/blog/news-updates/2030-dead-end-for-the-high-street .