Retail media, healthcare, financial services and food service all represent interesting new sources of revenue for supermarket chains. Ahold Delhaize sees both opportunities and challenges.
Loyalty card data
Following the publication of its quarterly results, Ahold Delhaize’s top management made time for an informal discussion with the Benelux trade press. RetailDetail’s Jorg Snoeck also took part, and he heard that one of the topics was new possible sources of revenue. For retail media, the retailer has set a revenue target of one billion euros.
“We are well on our way to achieving that”, CEO Frans Muller says . “We have taken a stake in a Belgian company called Adhese, to strengthen our competences. 70 % of our data comes through our loyalty cards. These data are used anonymously and aggregated, in compliance with all laws and regulations, but we can analyse it together with manufacturers, to come to better conclusions, to better propositions for customers.”
The media landscape is changing
In the Netherlands, Albert Heijn is already quite advanced in this respect, the chain’s CEO Marit van Egmond adds: “We have had our Albert Heijn Media Services for some time. That is taking off, but you also need to have the technology. This is why I am really happy with the minority stake we have taken in Adhese. I am looking forward to seeing what this will yield as we make this even more professional. Not only with Albert Heijn, but also with Etos and bol.com.”
“You see that the media landscape is changing, advertisers are looking for other channels”, CEO Europe Wouter Kolk adds. “They look at the ROI very critically. With us, you have a large reach and you can also see immediately what the click behaviour is in general and the buying behaviour. That is why that proposition is useful. Customers get much more relevant offers, instead of the same ads for everyone. There is interest from advertisers we do not have ourselves, but who show interest in our reach – things like car brands or banks… There are opportunities there.”
Nutrition and prevention
Healthcare is another focus for retail. “Walmart has already built twenty Health Centres in the United States, where you can have minor procedures done. That is quite impressive. We already do vaccinations, they really go a step further. But health itself, of course, is very close to us – if you can talk to people about nutrition, about fighting obesity and diabetes and better nutrition, we are doing that every day. It is the cheapest preventive way to get people to live healthier lives”, Muller said.
Van Egmond concurs: “I do think it is important if Albert Heijn can help customers in a healthy lifestyle. We do that with our offer of healthy and fresh products. Look how many freshness packs we sell: we now have more than seventy, and they help everyone to cook healthy. At the other end of the spectrum, we have our lifestyle platform, the My Lifestyle Coach app, which helps customers eat healthy but also exercise and sleep and relax. On average, we already have 200,000 people a week participating in the challenges.”
Roast chicken and sushi
What about food service in the supermarket? “We see that growing too”, van Egmond says. She refers to a recently renovated Albert Heijn supermarket in Amsterdam: “I think we put a nice new range there. Of course, we already had sushi, our Bakery Café and our own kitchen, but there are still lots of opportunities to add new ranges. Sometimes it is half-made in the shop, sometimes finished in the shop, there are many different ways to do this. It’s all day-fresh products though.”
“Our brands have food service in the US”, Muller adds. “That has boomed in the last three years, from roast chicken to whole meals, salad bars, etc. But it is not so easy to operate. You have high margins, but also high labour costs, because it is specialised labour – not comparable as filling a shelf. It is not so easy to make money with that, but customers respond very positively to this, it is a nice addition to the existing range. Sometimes we do it ourselves, sometimes we work with concessionaires, for example for sushi.”
With financial services, finally, Ahold Delhaize has not yet done much. “But we are always looking at opportunities. There are a number of European retailers doing it: Tesco, Sainsbury’s… There is potential over time.”