E-Commerce Tesco Expands Same-Day Click & Collect

Lisa Byfield-Green (Senior Retail Analyst)
07 March 2017

The UK’s leading retailer has announced plans to grow its same-day click & collect capability, offering shoppers additional flexibility for the expanding service. From next week Tesco customers at 300 UK locations will be able to pick up their online grocery orders from midday for orders placed by 09:00. This is in addition to the existing service, which allows an afternoon pick-up after 16:00 for orders placed by 13:00. 

Managing Director of Online at Tesco, Adrian Letts, said in a press release that the aim was to give customers more choice at a time when “more customers than ever” were choosing to use grocery click & collect. Tesco has seen a 20% increase in click & collect over the past year and revealed that 10% of orders are now placed for same day collection.

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Lisa Byfield-Green (Senior Retail Analyst)
Lisa Byfield-Green (Senior Retail Analyst)

Opinion Resurgent Tesco Takes On Amazon

07 March 2017

Regaining competitiveness is a key value of Tesco’s turnaround and this move responds directly to customer demand, as busy UK shoppers increasingly shop via multichannel, online and last-minute grocery missions. Tesco is taking the lead in offering faster fulfillment to drive shopper loyalty. This puts it ahead of both Sainsbury’s - which is still in the process of rolling out click & collect to all locations – and Asda, which is working to reverse falling like-for-like sales at its stores. Despite being the fastest-growing channel, online has taken a bit of a back seat in recent months with this difficult backdrop among the Big Four.

However, UK retailers are being forced to rethink their approach to competitiveness whilst facing into profitability challenges. This is in part because of a new player in the market - Amazon.  The online giant is fuelling customer demand for rapid delivery and also competing directly with its Amazon Fresh grocery service, which has already rolled out same-day home delivery in London and is poised for further expansion.

Tesco already competes with same-day home delivery, but where it has an advantage over Amazon is in its opportunity to transform its underutilised larger stores into collection points. By persuading shoppers to collect their groceries, the retailer reduces the costly overheads of last mile delivery. To recoup some of its investment the retailer has also increased charges, with same-day click & collect slots now priced at GBP2-4 (EUR2.31-4.61) and same-day home delivery slots at GBP3-7 (EUR3.46-8.08).

Already twice as big online as its nearest competitor, Tesco could further utilise its planned Booker acquisition later this year to provide additional click & collect points and fuel its multichannel lead over the competition. The expertise gained could also be exported over time into Tesco's key international markets, including in eastern Europe. 

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