Customers can order shopping through an app. You swipe through the different 'departments' and pay through the app, not at the door. You can indicate yourself when the shopping should be delivered. Muller is one of four entrepreneurs who started Picnic. Before, he was at the foundations of the unmanned petrol stations Tango and ANWB competitor Route Mobiel. He says that Picnic supplies fresher products than physical supermarkets. "We close the orders at 23.00. The suppliers deliver the orders at night and the shopping is at the customer's home the same day. In a supermarket a product can be on the shelves for a few days." The new company wants to officially start in September. There is already a trial in Amersfoort with 150 households.
So far online grocery shopping has had limited success in the Netherlands, as pick up or delivery often costs up to €12.95 extra. A lot of people also find it difficult to stay at home to wait for a delivery.
Muller has faith
In Sprout Muller indicates that he has faith that Picnic will succeed, after multiple initiatives such as Superdirect.com folded. "We are taking away the two main hurdles for consumers," says Muller. "First of all they don't want to wait long for their shopping, and secondly people don't want to pay for delivery." As far as Muller is concerned the time is right for online shopping. "Electronics and fashion have already made the leap to online, around 25 percent of it is online. Groceries are far behind." Only 1.5 percent of the 35 billion Euro of supermarket turnover was through the web. This is despite Picnic's estimate that 80 percent of consumers want to have their shopping delivered to their home.
So far online grocery shopping has had limited success in the Netherlands, as pick up or delivery often costs up to €12.95 extra. A lot of people also find it difficult to stay at home to wait for a delivery.
Muller has faith
In Sprout Muller indicates that he has faith that Picnic will succeed, after multiple initiatives such as Superdirect.com folded. "We are taking away the two main hurdles for consumers," says Muller. "First of all they don't want to wait long for their shopping, and secondly people don't want to pay for delivery." As far as Muller is concerned the time is right for online shopping. "Electronics and fashion have already made the leap to online, around 25 percent of it is online. Groceries are far behind." Only 1.5 percent of the 35 billion Euro of supermarket turnover was through the web. This is despite Picnic's estimate that 80 percent of consumers want to have their shopping delivered to their home.
Three years of work
Picnic worked on a new distribution method for three years with a team of 30 specialists, with which it is capable of delivering the shopping without unnecessary links. The customer chooses the most suitable route and knows when the delivery will take place within a half an hour margin. Because the costs of this new method of distribution are so low, the prices for the shopping can be kept low and delivery is free.
Heated discussion
Picnic hasn't even started and the online supermarket is already the subject of a heated discussion in the media. Experts are wondering whether it can compete with the purchasing power of Albert Heijn and Jumbo. Potential customers on the other hand are responding enthusiastically to the initiative.
'Odd marketing antic'
Paul Moers believes it's an 'odd' marketing antic. In his blog he writes that there are five important reasons that this project has a small chance of success:
The first is that the market is dominated by the large parties such as Albert Heijn and Jumbo. Besides this, there are also a lot of smaller supermarkets participating in this development, such as Coop. The big power Albert Heijn and Jumbo know everything about marketing, purchasing power and fine grained distribution. To defeat these parties would be very difficult. These parties also have a huge head start, especially Albert Heijn, who has been realising home delivery perfectly for years. Jumbo is building Pic up points at a rapid pace and will certainly switch to home delivery on the short term. There is little dissatisfaction with these parties, as they are doing their job excellently. The only unsatisfactory part would be the costs of the delivery. However, so far there have been little or no complaints about this. The parties also don't come across as dominant. This is the case with the big petrol companies and that's something Tango has hugely profited from.
Reasons why they might make it
Picnic thinks they have the answer. The retailer believes online grocery shopping hasn't caught on in the Netherlands is because consumers have to pay high delivery costs. This is why Picnic has free delivery and offers a lowest price guarantee. This will convince a number of budget conscious Dutchmen. How does Picnic calculate its earning model? Retailwatching gives three reasons why this newcomer might make it and could tickle giants like Ahold and Jumbo. Click here for the reasons
Supermarket expert Gerard Ruttte: no delivery costs is suicidal
Websuper Picnic won't get away with not charging delivery costs. "Without compensation for the delivery costs this model isn't possible, it may even be suicidal," says supermarket expert Gerard Rutte to Marketing Online.
The concept viewed from a logistics stance
At LogistiekProfs logistics professional Marcel te Lindert speaks. This week Marcel, journalist for the logistics and supply chain, discusses the launch of Picnic: an online supermarket that wants to keep the delivery costs low by working with set delivery routes. Does this concept have a chance of success? Picnic is the next in a line of initiatives that, so far, have run aground on high delivery costs. Are set delivery routes the golden egg? Picnic is choosing set routes, in which a delivery van is on the streets every other day. Consumers can sign up to a route and will receive a notification on the day regarding the delivery time, accurate within half an hour.
Consumers positive
The Dutch approach the new comer Picnic positively online. This shows from an analysis from social media by Coosto. Coosto has a livetool on their site that measures how Picnic is scoring on social media and in online reports.
Racism?
The Afrikanen in Diaspora Netwerk Nederland (Africans in Diaspora Network the Netherlands) isn't happy. Why? The name Picnic supposedly has a racist background. This is according to Iwan Leeuwin, formerly GroenLinks fraction president South East and coordinator of the network. TPO reports that Leeuwin wrote on his Facebook page that Picnic means "pick a nigger". This would mean that Picnic refers to the "organised torture and murder" of African Americans. Leeuwin therefore regards the word as having a racists background.