On this week’s episode of TheMadTech Podcast, foodpanda's marketing & sustainability director Laura Kantor joins Mat Broughton and Rachel Smith to discuss the latest news in media, marketing, and commerce.
This week they cover:
- “Quick commerce” (or “Q commerce”) has taken off in London, where a growing number of consumers have turned to platforms like GoPuff, Gorillas, Getir, and Zapp to get groceries delivered to their homes in as little as ten minutes. It’s not just the capital’s shoppers who are buying into the convenience market – according to reports, venture capitalists are investing millions into Q Commerce start ups, money which these companies are rapidly using as they vie for dominance in the space.
The stiff competition has proved a boon for customers, as brands offer staggering deals to win them over from rivals. Last month, Turkish start-up Getir offered customers a £15 discount on purchases worth £16, whilst German competitor Gorillas offered £10 off all products. The long-game is to create a culture of making small, frequent grocery purchases via smartphone and to accrue as many customers as possible through subsidised introductory deals.
The secret behind these platforms’ rapid-fire delivery is their use of so-called ‘dark stores’ – often resembling “messy corner shops”, these are small store rooms located near residential areas where stock is kept and can be quickly assembled and sent out to fulfil orders. Whilst convenient for customers, the creation and maintenance of these ‘dark rooms’ is another huge weight on investment. This means that, despite their growing customer base, Q commerce is currently far from being profitable.
Yet in spite of questions around the sustainability of its business model the space is humming, with 13 companies battling for dominance in the UK capital and a number of successful mergers and acquisitions recently within the market. Grocery giants Tesco and Sainsbury’s are also experimenting with Q commerce offerings, suggesting perhaps that the incumbents see the model as a credible threat to their dominance. Still, with costs and competition high, it’s unclear if (and how) current Q commerce platforms will capture a slice of the UK’s £160bn grocery market in the long-term.
- COVID-19 has triggered a permanent change to the way that some restaurants operate, according to a report from CBC Canada. Lockdown measures enforced to stem the spread of the virus saw thousands of the nation’s eateries shut their doors, leading many to expand or introduce a take-away service. Having discovered that it’s more profitable than dine-in, some restaurant owners have decided to pursue take-away for the long-term future and reduce their in-person dining offerings.
Some are investing in “specialised menus specifically for takeout” and “food that’s easier to make or [has] higher margins” to encourage people to opt for a take away from previously largely physical restaurants, according to Canadian Western Bank vice president for restaurants and breweries Jacob Mancini. The emergence of new Coronavirus variants and consequent lockdown measures has accelerated this shift, and seen some restaurant owners give up large commercial spaces to set up smaller restaurants with dedicated takeaway counters or drive-through lanes.
Bricks-and-mortar restaurants haven’t gone for good, with some owners designing more elaborate or unique experiences to encourage customers to dine-in. But whilst nation-wide restaurant sales almost returned to pre-pandemic levels last summer, owners are still having to contend with rising business costs spurred by supply chain disruptions, COVID enforcement measures, and a shortage of labour. For some, these factors have only cemented their view that take-away is the future and that reopening for in-person dining is simply not worth their while.
- A brand’s sustainability credentials would have an impact on the buying decisions of 30% of UK shoppers when it comes to purchasing a new bed or sofa. That’s the finding of a survey by tech specialists Red Ant, which revealed that consumers are taking more notice of whether a brand offers environmentally-friendly furniture and recycling services, and increasingly expect brands to take on a greater ecological responsibility.
This increased consciousness towards the environmental impact of consumerism is further reflected by the fact that 65% of those surveyed said that they expect to keep new furniture purchases for upwards of a decade. However, the remaining 35% stated that they would replace their furniture to correspond to household redecoration.
The research also uncovered that the majority of those surveyed prefer an in-store to an online experience when it comes to purchasing furniture. 95% said they like going to see the product in person before buying it, and 90% claimed to have had good in-store experiences. Meanwhile, 55% said they had had a poor experience of purchasing furniture online, with damage to the product, failed delivery, or unmet expectations cited as key reasons for their disappointment.