Covid-19 is an accelerator, not a gamechanger

The bad guy becomes the good guy

What kind of action plan did you have to make happen to react to the situation as fast as possible?

Covid-19 offered companies the opportunity to reshape their image and their reputation. Big supermarkets like Delhaize can receive a lot of criticism: “they put the small neighborhood stores under pressure, they put the farmers under pressure, they put the environment under pressure”. The lockdown changed everything, Roel explains:

‘Amidst huge stress and anxiety, we had to take up a crucial role. Our mission was very clear: we had to guarantee a safe place to shop for our customers and a safe place to work for our employees. We were no longer the bad guys, society relied on us. We are really proud that we managed to live up to that huge responsibility.’

From months to days, from weeks to hours

What kind of action plan did you have to make happen to react to the situation as fast as possible?

Delhaize is one the oldest and biggest companies in Belgium. It exists over 150 years, it has 32,000 employees, it has an annual turnover of more than 5 billion euros. ‘Our history and our size influence our governance structure. It takes quite some time to make decisions’, Roel admits. Covid-19 radically changed the governance model.

‘A small group received a mandate from the executive committee to take all the necessary decisions. We took decisions within hours and even minutes, instead of months or weeks. Some rituals and traditions have already returned, but we are confident we will take a part of that agility with us into the new normal.’

The 100% e-commerce customer does not exist (yet?)

How did you experience e-commerce during the last months?

’Obviously, e-commerce has boomed during the lockdown. The first few weeks retailers could not keep up with the exploding demand. ‘We can’t just double or triple our capacity, so both new and existing customers were sometimes frustrated.’ Before corona, e-commerce represented just 1% of Delhaize’s revenue of 5 billion euros. ‘Will that share rise to 5% or 10%? I don’t know. E-commerce has become an important part of our proposition, but we strongly believe in the combination of online and offline shopping. The 100% e-commerce customer doesn’t exist. Physical stores won’t disappear any time soon.’

London calling

How do you see the future of e-commerce within food retail?

Delivery will be the biggest challenge when e-commerce will keep on conquering market share. Roel is convinced that the way e-commerce is being organized today is not meant to last. He looks at London for inspiration. ‘Big companies deliver their products at hubs outside of the city center. Then small companies bring them into London, using different kinds of sustainable ways of transportation. I really can’t imagine cities will still allow big trucks in our residential areas in the future. There are more sustainable ways to organize that.

Corona is an accelerator, not a gamechanger

What changes in behaviour could you see within your customers?

Covid-19 has a huge impact on customer behavior. But the changes in consumer habits are not new, Roel says they have just accelerated dramatically. ‘A lot of our customers were already adapting a healthier lifestyle. When they read that obesity or diabetes are big risk factors for Covid-19 they accelerated that shift. We saw the same thing happening with e-commerce, with proximity stores around the corner, with locally sourced products,… : the evolution has already been initiated before corona hit us. The crisis puts pressure on existing systems and models. It creates a sense of urgency. Covid-19 was not the main gamechanger, but it sure was an accelerator.’

New, huge competitors with deep pockets

Did you experience more intense competition?

Delhaize operates in an extremely competitive environment. Food retail is known for its small margins. The last few years, new competitors have popped up. ‘In the future our competitors will not just be Carrefour or Colruyt, but also tech giants like Amazon and Google. Huge companies with deep pockets who want to disrupt our industry. In that brand-new retail landscape, we must continue to evolve and innovate.’

Supermarkets as laboratories

Did you use any new technologies to handle the new demands of customers?

The first crisis response of Delhaize and other food retailers was a human touch: security guards to manage crowds, staff disinfecting shopping carts, the in-store audio system asking customers to keep their social distance. Technology is essential to make food retail futureproof, but Roel sets high standards. ‘We need to fall in love with the problem, not the solution. Customers want to buy products, check out and go home again. That experience needs to be absolutely frictionless. For our customers, every technological solution needs to be dead easy and ready to use.’

The impossible becomes possible

Were there any additional challenges or opportunities you saw or took?

During the lockdown, Delhaize sold some products from Decathlon, that was forced to close its doors for several weeks. ‘Healthy food is important for us, selling product that help customers sport and work out was a logical step for us.’ The food retailer even partnered up with main competitor Colruyt to organize deliveries for hospital staff. ‘One year ago, that would have been totally unimaginable. But I’ve also noticed an incredible amount of creativity in other industries. The impossible became possible. A crisis gives you a new perspective. It makes you see new opportunities and it makes you do the unthinkable.’

Could you take Delhaize's approach as an inspiration to fuel your innovation?

1. Could you build the perfect customer experience by building complementary physical and digital touchpoints?
2. Could you use your network of outlets as a lab for innovation?
3. Could you make a healthy lifestyle more attractive?

Check out more ideation starters and areas of opportunities.