Ahold Delhaize Well-Positioned To Capture Worldwide Return To Food-At-Home

In the second quarter of 2021, Ahold Delhaize proved resilient against fluctuations in consumer mobility. The multinational grocery giant’s sales held relatively flat, even as consumers returned to restaurants. Comparable sales were down 1.5 percent in the United States, up 2.4 percent in Europe.

“While communities across our markets reopened during Q2, food-at-home demand remained very resilient,” Frans Muller, president and CEO of Ahold Delhaize, said in a statement. “Many of the habits formed by consumers during the COVID-19 pandemic in 2020 are proving sticky, aided by our initiatives to improve our omnichannel offerings for consumers.”

Notably, even as newly vaccinated consumers were emboldened to spend more time in public, indoor spaces, the company’s eCommerce mix continued to grow in the quarter, with net consumer online sales rising 36 percent overall and 61 percent in the United States. Muller noted the addition of click-and-collect capabilities to 86 of the company’s U.S. stores, with 175 more on their way in the next two quarters.

With the help of these additions, the company expects its online sales in the U.S. to grow 70 percent over the full year, meeting the increased demand. PYMNTS data finds that 57 percent of U.S. shoppers now order groceries online, including more than two-thirds of Gen Z shoppers and bridge millennials and 63 percent of millennials. Plus, 46 percent of consumers across age groups are buying more groceries online than they were before the pandemic.

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Additionally, the chain is taking control of its entire U.S. supply chain. Ahold Delhaize’s group of U.S. supply chain companies, ADUSA Supply Chain, announced in June that 85 percent of the chain will be self-distributed by the end of 2022.

See also: Grocery Roundup: Ahold Delhaize Takes Over US Supply Chain As Industry-Wide Sales Dip

In Europe, meanwhile, online sales grew 27 percent year over year. The company brought its fee-free Netherlands grocery delivery service AH Compact to more parts of the country and grew Albert Heijn’s grocery delivery program in the Flemish Region of Belgium twofold. Plus, Albert Hejin also remodeled 18 stores to a “technology-focused format” that is better able to support this growth, per a presentation shared with analysts. Additionally, the company’s Delhaize SuperPlus health and sustainability loyalty rewards program grew 12 percent to almost two million members.

With its overall sales stickiness and continued investment in eCommerce growth, the company is well-positioned for possible increases in COVID-19 safety measures and is able to meet the growing need for food-at-home from a position of strength, rather than scrambling to play catch-up. Continued office closures are hampering returns to restaurants that offer workday lunch, and ongoing cancellations of in-person events do not bode well for indoor dining, suggesting that the bulk of many consumers’ food spending could shift back to grocery in the near future.

In addition to growing its sales, Ahold Delhaize has been remodeling stores all over the world and opening and acquiring new stores, bolstering the company’s capacity to meet any increased demand that may come in the months ahead. As Muller reflected, “We continue to be in a strategically stronger position in 2021 relative to the time before the COVID-19 pandemic began. Our investments in our online proposition continue to serve us well.”