Is Ocado's robotic warehouse the grocery of the future?

Dive Brief:

  • U.K.-based Ocado has no physical presence in the retail sector, yet in a few short years, according to an article in MIT Technology Review and the company's own web site, its delivery business has zoomed to 67,000 deliveries in a single day.
  • The grocer's warehouse is heavily automated, with robots that shelve and move products to human pickers and packers. Separate computers optimize delivery routes.
  • A second warehouse, which will double the company's capacity and use even more swarms of robots to prepare orders, is under construction. A third is in the pipeline.

Dive Insight:

In 1984, coincidentally the title of a George Orwell novel, the A&P supermarket launched what it thought was a forward-looking supermarket concept called the Future Store. It centered on having all décor elements black and white – so nothing would take attention away from the food offerings. During the next few years, a number of them opened across the country. By the late '80's, all Future Stores were either closed or remodeled.

Fast forward to today and our current concept of "future stores." Amazon, once “just” a book-seller, now not only sells nearly everything. It's expanded into delivery services and brick and mortar stores, including the first supermarket with no checkouts.

Meanwhile in the U.K, Ocado is demonstrating how orders placed via smartphone into an almost-fully-automated warehouse can really shorten the “last mile.” It delivers to 70% of that relatively small nation in a mere couple hours – from order to doorstep – from a 40,000-item catalog. And the retailer is expanding its offerings, as well as shortening delivery times.

In 1984, the world was still a few years short of seeing the future through the eyes of the internet as we know it. Where will food retailing go in the next 33 years? Which option truly represents the future? Ocado's solution will appeal to – and be affordable by – some, but there are a lot of bucks between a dream and a football field-sized warehouse with thousands of computers and robots shifting merchandise.

Filed Under: Grocery Marketing
Top image credit: Ocado