Moscow, 18 May 2020 – X5 Retail Group N.V. (“X5” or the “Company”), a leading Russian food retailer that operates the Pyaterochka, Perekrestok and Karusel chains (LSE and MOEX ticker: “FIVE”), announces the further development of its online sales channels and the expansion of the pilot express delivery zone from Perekrestok supermarkets. After less than a month of operation, the service now covers the entire territory of Moscow within the Moscow Ring Road, and has extended its order assembly base from nine stores when it was launched to 46 supermarkets today.
In the context of safety measures related to COVID-19, this service enables shoppers to replace their daily trips to the store with online orders that offer the assortment from the nearest Perekrestok supermarket, where orders are assembled in-store. The average delivery time is less than 60 minutes, and around 400 orders are completed per day. Shoppers’ most frequent purchases include fresh fruits and vegetables, as well as dairy, with the typical check consisting of 14 items. The average weight of one order is 9.5 kg, and the average check is RUB 2,100. The service covers households near each participating supermarket; a courier usually needs to travel around 1.6 km to reach the customer. The level of orders with no substitutions is currently 97%.
While the pilot project has only been running for less than a month, the service has achieved a fairly high level of customer satisfaction: repeat orders in May reached 60% and the average rating in the app is 4 out of 5. Perekrestok loyalty cards were used for 80% of purchases. Groceries are ordered most frequently by Moscow residents in Yasenevo, Izmailovo and Yuzhnoye Medvedkovo districts.
It takes one day to get a supermarket connected to the express delivery service. Stores are selected based on the number of households in the surrounding area and the assortment that the supermarkets offer.
“Express delivery or groceries is currently a socially meaningful project that helps our consumers to ensure their personal safety. X5 offers its customers different ways to achieve this: they can stock up using perekrestok.ru, use the express delivery from Pyaterochka proximity stores, and, since the end of April, try out 1-hour deliveries from Perekrestok supermarkets. X5 has become a leader in the online grocery segment thanks to the efficient operating models of its online platforms, the Company’s digital transformation and an effective strategy for the development of online services.
“The pilot project for the express deliveries from Perekrestok supermarkets was launched within a short time and with heightened attention to service quality. In less than a month of operation, the service achieved good business results and enjoyed significant interest from customers. This was supported by a new approach to refining the pilot project: we used an open testing approach, which enabled our customers to participate in fixing errors and implementing improvements in real time. In just a few days we received dozens of constructive reviews, which is helping us improve the quality and convenience of the service, even with the rapid growth we are now witnessing,” said X5 Retail Group CEO Igor Shekhterman.
Supermarket employees assemble Perekrestok orders, while deliveries are handles by specialised grocery delivery services. There is no minimum order. Depending on the store, an assortment of anywhere from 9,000 to 14,000 SKUs is available.
X5 previously reported that online sales from the Perekrestok.ru and Delivery.Pyaterochka platforms increased by 4.7 times year-on-year to RUB 1.7 billion (including VAT) in April, which, according to Infoline, makes X5 Retail Group the #1 player in online grocery delivery in Russia in April. April 2020 online sales accounted for 2% of X5’s turnover in Moscow, the Moscow region and St Petersburg, where online services are available. At the end of the month, X5 was delivering more than 23,000 orders per day, and that number continues to grow. In April, the total number of orders delivered through its two online platforms was more than 520,000, with 262,000 orders delivered through Perekrestok.ru and 259,000 through Delivery.Pyaterochka.
X5 achieved its leading position in Russia’s online grocery delivery segment in April thanks to the efficient operating models of both online platforms, the Company’s ongoing investments into digital transformation, its effective strategy to develop digital services, a strong team and the impressive procurement capability of X5 as the country’s leading food retailer.
X5 expects the online grocery market in Russia to continue to grow, and for the Company’s market share in the grocery delivery segment to rise in 2020 and beyond.