PRJ-AUEB-M.Sc-LeShop-15Jul2015

M.Sc in Marketing and Communication

Case StudyLeShop

July 15, 2015

Contents

LeShop OverviewA

KPIs EvolutionB

Success FactorsC

Upcoming Marketing ObjectivesD

Contents

LeShop OverviewA

KPIs EvolutionB

Success FactorsC


Zoe Zygogianni • Andreas Marinis • Zoi Sfyri • Dimitris Tzanos

M.Sc in Marketing and Communication • AUEB • LeShop Case Study • July 2015

4

LeShopThe company in brief

LeShop OverviewA

LeShop.ch is the leading Swiss online supermarket. The company counts 50’000 regular customers and achieved a turnover of 165

million CHF in 2014.

The supermarket offers a unique assortment containing Migros products as well as branded goods. Groceries including frozen foods

and other essentials, articles for home and hobby are delivered directly to the customers’ door. Deliveries cover almost all Swiss

regions (95% of all households).

The great majority of customers are young families and professionally active people. Above all, they appreciate the time

saving service and convenient online shopping experience because it makes their everyday life much easier.

LeShop.ch is the leading Swiss online supermarket. The company counts 50’000 regular customers and achieved a turnover of 165

million CHF in 2014.

The supermarket offers a unique assortment containing Migros products as well as branded goods. Groceries including frozen foods

and other essentials, articles for home and hobby are delivered directly to the customers’ door. Deliveries cover almost all Swiss

regions (95% of all households).

The great majority of customers are young families and professionally active people. Above all, they appreciate the time

saving service and convenient online shopping experience because it makes their everyday life much easier.

Source: Official LeShop Website



5

LeShopMission

LeShop OverviewA

Our mission is to offer you a simple and user-friendly shopping experience, a unique assortment in Switzerland, a flexible delivery

and pick-up service and an excellent customer care.

Our mission is to offer you a simple and user-friendly shopping experience, a unique assortment in Switzerland, a flexible delivery

and pick-up service and an excellent customer care.




6

LeShopVision

LeShop OverviewA

LeShop.ch strives to be Switzerland’s favourite supermarket.

LeShop.ch strives to be Switzerland’s favourite supermarket.


Contents

LeShop OverviewA

KPIs EvolutionB

Success FactorsC




8

LeShop Turnover EvolutionFinancial Year 2014 closed at a turnover of CHF165M;LeShop turnover is increasing FY over FY with a 15-year CAGR of ~28%

KPIs EvolutionB

165158

150150151

132

112

92

65

47

33

15131264

90

0

30

60

90

120

150

180

Turnover (in million francs)

20001999

90

20142013201220112010200920082007200620052004200320022001

1795%

92%

28%

44%

43%

2015

CAGR

Note: CAGR stands for Compound Annual Growth Rate

Half 1 - 2015

Projection for Half 2 - 2015



9

Product LifeCycleCurrently LeShop seems to be in the boundaries of Growth and Maturity phase

KPIs EvolutionB

Exponential

Logarithmic

Linear



10

LeShop Turnover ProjectionApplying crisis CAGR (~5%) for the next 5 years, we conclude that in 2020, LeShop turnover will equal >CHF210M

KPIs EvolutionB

214205

198192

185

90

165158

150

0

30

60

90

120

150

180

210

240


2020

5%

201920182015

180

201420132012 2016 2017

90

CAGR


Actual Projection



11

Average shopping basket/year EvolutionContinuous increase in the cost of average shopping basket per year now standing at ~CHF250

KPIs EvolutionB

250

225

200

175

150

0

2013

244248

Average shopping basket/year (in francs)

20122011

235

2010

235

2009

228

2008

224

2007

213

2006

213

2005

214

2004

204

2003

193

2002

165

2001

158

2000

142

2%



12

Average shopping basket per year vs. total turnoverAverage shopping basket per year and turnover are correlated

KPIs EvolutionB

100

120

140

160

180

200

220

240

260

280

300

0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160

Average shopping basket/year (in francs)


2013

2012

2011 2010

20092008

2007200620052004

2003

20022001

2000

R^2= 80,7%

Number of baskets per year



13

Unique orders per yearHighest number of unique orders was achieved at 2010; Consistently >610K orders since then

KPIs EvolutionB

600

550

500

450

300

250

200

150

100

50

0

650 638615

2011

638

2010

643

2009

579

2008

500

2007

433

2006

303

2005

220

2004

160

2003

79

2002

78

2001

73

2000

42

Unique Orders (10^3)

20132012

4%



14

LeShop Team EvolutionAll time high with ~300 collaborators at the beginning of 2015;~25% annual growth rate since foundation

KPIs EvolutionB

292

257243

200

220207

167

134

746960

4025

7

July 2011

December 2011

April 2013

January 2014

January 2015

October 2007

December 2002

February 2005

October 2006

April 2002

April 1998

April 2000

April 2001

14%

24%

22%

81%

50%

25%

December 2009

CAGR




15

Turnover vs. number of collaboratorsThese two metrics are highly correlated, as Rsquared is nearly ~1

KPIs EvolutionB

0

50

100

150

200

250

300

0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160

Collaborators


2013

20112009

2007

2006

20052002

20012000

R^2= 96,0%



16

Contribution per collaborator evolutionCHF0,75M the highest contribution per collaborator achieved in 2011

KPIs EvolutionB

300

400

600

800

500

700

0

2009

638

2007

553

2006

481

636

2002

213

2001

288

2000

240

2005

Contribution per collaborator (in 10^3 francs)

2013

651

2011

750

-13%

Resource Optimisation



17

Marketing Details of 2014LeShop being the market leader with 61% share; Driven at some extent of the extensive usage of digital devices

KPIs EvolutionB

Part of turnover achieved via …

Estimated market share

39%

iPhone/iPad & Android smartphones

61%

Other

61%

LeShop

39%

Other e-shops



18

Mobile Orders Evolution

KPIs EvolutionB




19

LeShop PositioningLeShop with clear focus on repeat customers and those preferring ordering fresh products

KPIs EvolutionB

Customer RetentionPercentage of customers ordering fresh products

91%

Repeat Customers

9%

Other

92%

customers ordering fresh products

8%

Not ordering fresh products



20

Customer ExperienceFully satisfied LeShop’s customer with a 100% coverage within Swiss households

KPIs EvolutionB

Complaint Resolution Delivery Area - Coverage

Customer Satisfaction Guarantee

100% 100%

Swiss householdsdue to

partnership with

PostLogistics



21

LeShop Delivery Service

KPIs EvolutionB




22

Awards

KPIs EvolutionB

Best e-commerce website, European Biarritz Festival1998

Best e-commerce website, Swiss Multimedia Award1999

Best e-supermarket website in Switzerland, test made by Sonntagszeitung.ch2001

Strategis Strategy Award, Bilan/HEC Lausanne1999

Best grocery shopping website in Switzerland according to “anthrazit2005

Best e-supermarket website in Switzerland, test made by Beobachter.ch2001

“Best sustainable development partnership” award2007

Most convenient grocery shopping website in Sw/nd according to “anthrazit”2005

One of the 10 best e-shops of the eating/drinking category2008

Best of Swiss Web prize2009

“App Store BEST OF 2012” category in Switzerland2012

Bronze at „Best of Swiss Web Award“2013

Bronze medal for iPad app at “Best of Swiss Apps 2013”2013

2nd place at the “Swiss E-Commerce Award 2014” in the category Mobile2014

Contents

LeShop OverviewA

KPIs EvolutionB

Success FactorsC




24

Success FactorsC

External Success Factors

• Limited opening hours in grocery stores

• Parking problems

• Small stores, narrow aisles, limited assortment

• Family spend 150-200 hours a year doing grocery

• Targeted working women with young children (free themselves from stressful and tedious household replenishment duties)

• Limited opening hours in grocery stores

• Parking problems

• Small stores, narrow aisles, limited assortment

• Family spend 150-200 hours a year doing grocery

• Targeted working women with young children (free themselves from stressful and tedious household replenishment duties)



25

Success FactorsC

• Big amount of product offered (5,500 food and non-food products)

• Focus on fresh products (meat, fruits, vegetables etc)

• Premium items (700 products)

• Cooperation with leading manufacturers (P&G, Nestle, BestFoods)

• Easy & secure online transaction, satisfying needs assortments, customer care

• Big amount of product offered (5,500 food and non-food products)

• Focus on fresh products (meat, fruits, vegetables etc)

• Premium items (700 products)

• Cooperation with leading manufacturers (P&G, Nestle, BestFoods)

• Easy & secure online transaction, satisfying needs assortments, customer care

Internal Success FactorsProducts



26

Success FactorsC

• Family Line (bigger size packs)

• Value Line (20% to 30% below)

• Family Line (bigger size packs)

• Value Line (20% to 30% below)

Internal Success FactorsPrice



27

Success FactorsC

• Credits to a customer who invited a new one

• Telemarketing, direct mainly, print ads and partnerships with women’s magazines

• Emails (inform about new products or services and promotion)

• Price promotion campaigns

• Free product samples

• Moneyback 100% guarantee

• Prompt handling and communication of quality issues

• Credits to a customer who invited a new one

• Telemarketing, direct mainly, print ads and partnerships with women’s magazines

• Emails (inform about new products or services and promotion)

• Price promotion campaigns

• Free product samples

• Moneyback 100% guarantee

• Prompt handling and communication of quality issues

Internal Success FactorsPromotion



28

Success FactorsC

• Simple (make shopping grocery fast & easy)

• 3 Languages

• User friendly online catalogue

• Product categorization

• Simple (make shopping grocery fast & easy)

• 3 Languages

• User friendly online catalogue

• Product categorization

Internal Success FactorsWebsite



29

Success FactorsC

• Use of scanner system

• Own logistic center (1st e-commerce fulfillment center in Switzerland)

• Fulfill orders fast

• Use of scanner system

• Own logistic center (1st e-commerce fulfillment center in Switzerland)

• Fulfill orders fast

Internal Success FactorsLogistics



30

Success FactorsC

• Fast delivery (order before midnight delivered next day)

• Fast delivery (order before midnight delivered next day)

Internal Success FactorsDelivery

Contents

LeShop OverviewA

KPIs EvolutionB

Success FactorsC




32

Upcoming Marketing Objectives

D

Marketing ObjectivesPart I

• Evolution of internal processes in order to improve eliminate the delivery time.

• Spread to new target group such as hard workers and university students.

• Increase repeat customers by 6% per quarter.

• Partnership with more local services.

• Decrease promotion costs by site ads of new products.

• Decrease customer acquisition costs by 10% for the next year.

• Actions such as point system to ensure the customer loyalty.

• Evolution of internal processes in order to improve eliminate the delivery time.

• Spread to new target group such as hard workers and university students.

• Increase repeat customers by 6% per quarter.

• Partnership with more local services.

• Decrease promotion costs by site ads of new products.

• Decrease customer acquisition costs by 10% for the next year.

• Actions such as point system to ensure the customer loyalty.



33


D

Marketing ObjectivesPart II

• Online campaigns in social media so as to give emphasis to ‘word of mouth’.

• Investments in new technologies in order to solve technological problems which affect commercial processes.

• Increase the average shopping basket

• Increase the frequency of online grocery shopping

• Educate Swiss market on online grocery shopping through presentation on public places

• Optimize every possible procedure to reduce the cost per order

• Invest further to quality and customer relationship

• Online campaigns in social media so as to give emphasis to ‘word of mouth’.

• Investments in new technologies in order to solve technological problems which affect commercial processes.

• Increase the average shopping basket

• Increase the frequency of online grocery shopping

• Educate Swiss market on online grocery shopping through presentation on public places

• Optimize every possible procedure to reduce the cost per order

• Invest further to quality and customer relationship



34


D

Priority Activities to meet Marketing ObjectivesMarketing Mix

1) PRODUCT• 3 kinds of customerso by necessityo by comforto Testers

2) PRICE• 3 price levels based on 3 baskets with a potential purchase of a

subscription which increases the frequency of customers.3) PROMOTION• brand awareness activities• customer acquisition activities• customer retention4)PLACE• Interfaces: PC, smartphone, tablet

1) PRODUCT• 3 kinds of customerso by necessityo by comforto Testers

2) PRICE• 3 price levels based on 3 baskets with a potential purchase of a

subscription which increases the frequency of customers.3) PROMOTION• brand awareness activities• customer acquisition activities• customer retention4)PLACE• Interfaces: PC, smartphone, tablet



35


D

SWOT AnalysisStrengths

• Large landscape of proposed products.

• Well established MIGROS.

• 3 kind of proposed services.

• Smartphone app.

• Le shop has the highest market share.

• Quick delivery time.

• Large landscape of proposed products.

• Well established MIGROS.

• 3 kind of proposed services.

• Smartphone app.

• Le shop has the highest market share.

• Quick delivery time.



36


D

SWOT AnalysisWeaknesses

• Needs to manage 2 stocks (conventional and leshop stock)

• Depends a lot of the technology.

• Needs to manage 2 stocks (conventional and leshop stock)

• Depends a lot of the technology.



37


D

SWOT AnalysisOpportunities

• Word of mouth process.

• Important landscape of possible customers.

• Development of partnership with local services such as La poste.

• Word of mouth process.

• Important landscape of possible customers.

• Development of partnership with local services such as La poste.



38


D

SWOT AnalysisThreats

• Energy price evolution. (Higher costs)

• Concurrent.

• Web payment.

• Administration frame evolution.

• Threat of new entries

• The competitor(Migros) has the highest national awareness

• The quality of service is very difficult to maintain

• Energy price evolution. (Higher costs)

• Concurrent.

• Web payment.

• Administration frame evolution.

• Threat of new entries

• The competitor(Migros) has the highest national awareness

• The quality of service is very difficult to maintain



39

For further information please contact

Zoe Zygogianni E-Mail: [email protected]

Andreas MarinisE-Mail: [email protected]

Dimitris Tzanos E-Mail: [email protected]

Zoi SfyriE-Mail: [email protected]



40

Thank you!

PRJ-AUEB-M.Sc-LeShop-15Jul2015

Documents

leshop vision leshop

leshop turnover projection

brief leshop overviewa

official leshop website

cagr note

year cagr

equal chf210m kpis evolutionb

crisis cagr