Morrisons needs to get with the programme online - but it can from rivals' mistakes, says Liz Hamson
It’s rarely the front-runner that wins the race – as Marc Bolland, who we reveal this week is finally plotting a move into online deliveries, knows only too well – but boy, has Morrisons got some ground to make up.
To say it has given its rivals a head start is an understatement. Tesco et al are already halfway down the track, while the Bradford-based retailer hasn’t even crossed the start line yet. (Indeed, it hasn’t officially entered the race). But there’s plenty of time to sneak up on the rails, especially over a course this long and tough.
In fact, it might not be such a bad time for Morrisons to make its move. For a start, it will have learned from everyone else’s mistakes (and there have been many – Sainsbury's website going down for two full days last June to name just one). It is also only part way through a major upgrade of its IT systems, which means it can build the infrastructure of a new online delivery service on solid, brand spanking new foundations and avoid the logistical nightmares and expense of having to clumsily bolt on or integrate it with a store-focused supply chain.
Most importantly of all, it might just be able to make online stack up financially. It is easy to be seduced by the sales figures. The latest TNS data shows online grocery sales shot up 20.3% to £795m in the 12 weeks to 17 May. Profit is another kettle of fish, as Ocado itself has found having only recently started to turn one, albeit at EBITDA level.
Bolland is still being cagey, maintaining at the agm this week that Morrisons won’t go online unless it can make money doing so. But after a succession of flat denials, that sounds awfully like a confirmation to me and judging by his rather more frank comments at a recent staff conference it is now a matter of when rather than if.
A good thing too. At the moment, Morrisons’ website is as a Spectrum to its rivals’ PS3s, XBox 360s and Wiis. It’s high time it got with the programme.
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