Online-only retailer Ocado has posted a 13.1% increase in retail sales for the first quarter of the year, to £352.4 million, according to a trading statement recently issued.
The UK-based group said that average orders per week grew 16.7% to 252,000 in the first quarter, which was driven by both new and existing customers. However, it added that the average order size fell by 1.6% in the period, adding that this was a slower rate of decline than in previous quarters.
"In this quarter, the fall was driven primarily by a reduction in multibuy promotions and further take-up of the Ocado Smart Pass, which drives customers to shop more frequently and increases customer retention," it said.
Steady Progress
Commenting on the group's performance, Tim Steiner, Ocado's CEO, said, "We are pleased with the steady progress and growth achieved in the period, as shoppers continue to embrace our proposition for online shopping.
"We believe our commitment to further improving the customer experience and service through constant innovation, supported by proprietary technology developments, will enable us to continue to grow ahead of the online grocery market, and substantially ahead of the market overall."
Steiner added that there are signs of a change in market-price dynamics emerging as a result of the decline of sterling. "However, it remains too early to predict how this will unfold throughout the year, and, in particular, is dependent on any future currency movements," he said.
Analyst Comment
Commenting on its performance, Bruno Monteyne of Bernstein Research said, "These trading results are in line with Bernstein estimates and in line with company consensus guidance of approximately 13% for gross retail sales [consensus collected from a small number of companies].
"Growth in gross retail sales is on a downwards trajectory: from 14.0% in Q2 2016, to 13.7% in Q3, 13.2% in Q4, and now 13.1% in Q1 2017."
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
