At Coles’ half year results announcements last week, Hassing said its e-commerce strategy is built on the brand’s three pillars of inspiring customers, smarter selling and winning together.
“We pride ourselves on being customer-obsessed, and doing so in a way that also adds value to the Coles Group,” Hassing said. “We seek to inspire our customers to shop anytime, anywhere, anyhow.”
The first stage in Coles’ online transformation centres on creating a seamless and unified customer experience.
“To activate this, we are connecting e-commerce and content. And then we’ll begin merging online and offline into a unified experience,” he said.
The retailer will also focus on providing customers with an offer that is “uniquely Coles” by launching new services that will continue to evolve over time.
“All of this is enabled by delivering through speed – speed in design, speed in development and speed in delivery. We do this as one Coles team, and not a separate silo within Coles.”
With Covid-19 accelerating the importance of digital and e-commerce as part of the grocery shopping experience, Coles is seeing more and more customers engaging digitally, whether to explore products and content or to use online services such as click-and-collect or home delivery.
“These digitally-engaged customers are very, very important to Coles. We find them more loyal, they shop with Coles more frequently and they have a higher participation rate in Flybuys,” Hassing said.
The rise of the omnichannel shopper is heavily influencing the renewed strategy at Coles, and the vast majority of the supermarket’s online shoppers also shop in-store.
“Omnichannel customers spend much more in total with Coles. In our most recent quarter, our omnichannel customer spent 2.1 times more in total with Coles than the customers that only shop online, or those that only shop in Coles stores. This is a fast growing customer segment for us. The year-over-year growth in total spend with Coles is much higher, as well.”
As part of Coles’ initiatives to be more integrated and customer-focused, Coles will merge its content website, Coles&co, with its e-commerce site in the second half of 2021. Currently, the Coles app allows customers to make shopping lists and explore the digital catalogue but users can’t make orders from there.
“That’s going to provide a seamless experience for the customer. We’re also delivering omnichannel enterprise capabilities that give us a 360-degree-view of customer, of product, of order, and more,” he said.
Speed of delivery
Earlier this month, Coles became the first major Australian retailer to launch 90-minute click-and-collect, overtaking rival Woolworths’ fastest delivery option, Delivery Now, by 30 minutes.
Coles’ Click&Collect Rapid has been rolled out at over 400 locations around the country at a flat fee of $5 for up to 40 items.
“We tested the proposition in late November, and we were very pleased with the results and the feedback that we got from customers. We quickly scaled up our store operations team, adapted very quickly and executed flawlessly,” Hassing said.
“We recognise that immediacy and online grocery is occasionally desired by our customers … We learned in Q1 that we can add flexible, low-cost capacity as well as delivery, and we will be building this into the future.”
Rewards for choosing online
Coles also announced the introduction of Coles Plus, a subscription-based digital rewards program designed to drive online shopping.
For a $19 monthly fee, members can earn double Flybuys points on eligible Coles Online, have unlimited access to Coles’ new Click&Collect Rapid, access to a priority Customer Care line, free delivery for all Coles Online orders over $100, and one free delivery per month for Liquorland online orders over $50.
Hassing said in a statement at the time that it’s about giving customers more.
“Coles Plus is the latest way we are rewarding the loyalty of our digitally-engaged customers, ensuring Coles leads anytime, anywhere, anyhow shopping,” he said.
“We continue to see significant growth in demand for online grocery shopping and we are investing in customer experience and capacity, which is having a positive impact on customer satisfaction.
Coles’ data and loyalty program Flybuys, now a standalone business, remains under split ownership, with Coles owning 50 per cent and former parent company Wesfarmers retaining the other half since the demerger in 2018.
At June 30, 2020, there were 6.8 million active households in the Flybuys loyalty scheme.
Ocado on the way
Hassing also highlighted a number of benefits of its partnership with leading online grocery service Ocado which will hit Australia in FY23, CEO Steven Cain confirmed.
“Firstly, the customer will have access to more selections as we carry more range in a central location. Second, the customer service is significantly enhanced. Lastly, the CFCs [customer fulfilment centres] allow us to optimise assets, such as inventory, both the breadth and the depth, as well as our overall network assets.”
“We’re also learning a lot from Ocado retail partners across Europe, North America and Asia, and we look forward to bringing differentiated capabilities to the Australian market together.”
Construction of the Melbourne CFC is continuing and now construction at the Sydney site is also underway.