Ocado sales rise as website goes dark

Ocado Retail has announced that revenue grew by 10.3% to £441.2m in the first quarter of the year.

Average orders per week rose by 10.2% in the 13 weeks ended 1 March 2020, while average order size rose by 0.3%.

The supermarket group attributed the increased demand for orders and higher basket value to customer’s concerns over the ongoing Covid-19 pandemic. 

Ocado ensured it is “taking all measures” to have service remain “as close to normal as possible” and to meet as much of the demand as it can. 

The group’s latest update comes only one day after the Ocado website was temporarily shut down in order to make “operational changes”, so it can “deliver the most groceries at this time of need and to provide the best possible service for customers despite the disruptions”. 

In a statement, the group said: “Having sold all of our delivery capacity for the coming days, we took the decision to temporarily close our webshop to enable us to make changes to ensure the distribution of products and delivery slots is as fair as possible for our customers.” 

The closure will not affect existing orders as the group is still delivering to any customer that has already placed an order. 

It has, however, halted registration for new customers “for the time being”, and installed a new queuing system on its site to reduce the impact of a “several hundred percentage” increase in web traffic. 

It has also closed its app temporarily, while it scales the ability to serve the “unprecedented use” of its customer interfaces.

Melanie Smith, Ocado Retail’s chief executive officer, said: “The impact of higher basket values and order demand, amid growing public concern over the Coronavirus, was limited in the quarter.

“This has since picked up significantly and growth in the second quarter is so far double that of the first quarter. We expect the impact of forward buying, however, to unwind at some point.” 

She added: “However coronavirus unfolds, what is clear is that the fundamentals at Ocado Retail are strong, illustrated by double digit increases in customer orders, driven by consistent execution, which deliver a best-in-market customer experience.

“I am tremendously proud of my colleagues and the outcomes we have achieved in the first quarter. I am confident that our resilience, teamwork and commitment will stand us in good stead to continue to deliver for our customers even with the current uncertainties.”