Amazon has significantly increased its influence over the UK’s grocery market as Co-op becomes the third major supermarket to sell its goods via its website.
Co-op, now the UK’s 6th largest grocer, follows Booths and Morrisons in listing its entire range of goods on Amazon as it aims to dramatically boost its online operations.
The grocer said that it plans to more than double its online sales from £70 million to £200 million, driven by Amazon’s “reach and leading technology and innovative approach”.
Amazon customers in Glasgow and surrounding areas will have access to Co-op’s goods initially, but the partnership will rollout across the UK by the end of the year.
Prime subscribers will have access to same-day or two-hour delivery slots for free on all orders over £40, with a £3.99 charge for any orders below that value.
Co-op also said it plans to more than double the number of autonomous delivery robots operating in the in the UK by the end of the year, expanding out of Milton Keynes and Northampton for the first time since it launched a partnership with Starship Technologies in 2018.
It comes as Amazon continues to ramp up its influence on the UK’s grocery sector, following a rapid rollout of five physical Fresh stores across London this year.
This week Amazon also launched its first partnership with Deliveroo since it made a major investment in the company in 2019, offering Prime subscribers a year’s subscription to Deliveroo Plus.
Shore Capital’s retail analyst Clive Black said: “We don’t think Amazon is engaging in all this guff because it wants to be a marginal player in UK grocery.
“We expect Amazon to be the key cog in the industry’s organisational change in the next five to 10 years. And we would be very surprised if it didn’t acquire a major British supermarket chain.”
Andy Brian, partner at retail specialist law firm Gordons, added: “There has been a fair amount of attention recently on frictionless stores being the next big thing for retail, but this is really where the future lies. Who can successfully – and profitably – get products ordered on mobile devices to customers in the shortest possible time, so they don’t even have to bother with shops at all.
“Demand for this type of fast, no hassle service will only increase in line with the ability for consumers to order products easily, with one-click, directly from social media or through QR codes.
“Established delivery partners such as Amazon, Deliveroo and Uber will facilitate this to some extent (Co-op already partners with Deliveroo for example), and alongside these partnerships some of the grocers have already started to develop in-house, on-demand delivery devices. But we will also see the rise of other third party partners such as Weezy, Dija and Getir.”