Waitrose goes head to head with Ocado

The news that Waitrose is rebranding its home delivery service to Waitrose.com as part of a £10m investment to accelerate the growth of its online operations, raises some questions surrounding its relationship with Ocado.

Waitrose is making the site easier to use, boosting its functionality and services such as click-and-collect. Customers can make special requests for their shopping and the number of delivery slots in high demand times is being extended.

When it launches in March, Waitrose.com will also offer Waitrose Entertaining, which allows customers to buy everything they need for a dinner party, or special occasion.

Mark Price, Waitrose CEO says that the relaunched Waitrose.com will mean the grocer can provide the “unrivalled standards of service and the personal touch [shoppers] associate with our branches” via its online business.

Surely a little dig at Ocado, which despite mainly selling Waitrose products and being used by Waitrose customers, at the end of the day isn’t Waitrose.

When Ocado launched, Waitrose didn’t have its own online grocery business, and so the partnership with the start-up offered a way into the market.

As part of that initial supply deal, Waitrose could not deliver shopping to any homes within the M25 giving Ocado the monopoly around London. Under a new 10-year deal agreed last May Waitrose can roll out its own delivery service to London this Summer, eroding Ocado’s stronghold in the south.

The fact that Waitrose has nothing to stop it delivering nationwide, paired with the £10m invested in revamping its online operations, changes the relationship between the two grocery brands and increases the need for each to differentiate themselves better.

It’s worth pointing out that while industry observers are well versed in the knowledge that Ocado is a separate business to Waitrose, a whole host of people on the street believe that they are one and the same. The confusion surrounding the two co-existing is something both Waitrose and Ocado need to address.

Ocado shares suffered a hefty fall on the news that Waitrose was bolstering its online division, and now that Waitrose has proved it can go it alone online, is there a need for Ocado at all?