Success Story: Grocery Startup Picnic Wins Big on Customer Obsession
By Anna Noakes Schulze
If you want to know what the future will bring just keep an eye on the startup scene. That’s where you’ll find the products and services of the future being born. Sure, many startups will fail along the way, or keep on failing until they finally pivot to the right idea, the right market, or the right business model. Their fortunes may be shaky, but they still enjoy tremendous advantages over established businesses.
Startups are agile by nature. They aren’t bound by convention or legacy systems so they can be much more creative in the solutions they design. By radically innovating and capturing the Zeitgeist, successful startups can scale up rapidly and influence our lives in exciting and inspiring ways.
Startups have tremendous freedom to design their customer experiences from the ground up. This is a far simpler task than driving cultural transformation in a company unaccustomed to being customer-centric. Startups can plan the entire customer journey around delivering on their brand promise. And it shows.
The COVID-19 crisis is an existential threat to the global economy that will drive many businesses to extinction. Any business that is unloved, unnecessary, or unprepared to face the future is at risk of going under. How can you make sure that doesn’t happen to you? The answer is to cultivate your company’s customer obsession:
Know your customers inside and out
Understand what they value and will pay for
Involve customers and show that you care
Close the customer feedback loop
Constantly innovate to serve them better
A great example of a startup winning with customer obsession is the Dutch online grocery startup Picnic. Starting in 2015, Picnic debuted their “Milkman 2.0” concept to make online grocery orders and delivery as simple and convenient as milk delivery used to be. Picnic offers a clever, eco-friendly service that sources and buys food locally, and then uses a fleet of compact electric vehicles to deliver the orders to customers free of charge.
“The idea is simple. We do the shopping for you and you have more time for beautiful things.” — Picnic
Picnic’s USP is simple but brilliant. They aim to make grocery shopping faster, easier, and cheaper. In addition, they make it easy for customers to choose a delivery window, track the delivery vehicle’s location from the app, and know very accurately when the delivery will arrive. Their small delivery vehicles can get in and out of narrow streets without blocking traffic. Groceries are delivered with a smile. 😊
After three years of explosive growth in the Netherlands, Picnic expanded into a neighbouring part of Germany and started shaking things up. People living in countries with extensive online shopping options may not appreciate how exciting it is to have groceries delivered. Here in Germany, our options are very thin on the ground.
There are at least half a dozen supermarkets in my area, not including speciality shops. Each store carries different inventory, even between branches of the same store. Stocking is a tad unreliable and time-limited specials arrive up to three times a week. Even before the Coronavirus lockdown — and subsequent toilet paper shortages — I was stuck in endless rounds of cruising all of my local supermarkets. And if you’ve ever been to three stores just trying to find a lemon (any kind of lemon), you’ll understand my craving for simple and convenient shopping.
Of all my local supermarkets, only Rewe offers online ordering and delivery of fresh foods, either via website or app. Once the lockdown was underway, they were understandably overwhelmed with demand. The app would crash and lose my order after failing to find a delivery slot. Disappointing, of course, but Rewe showed their class and sent me an email to apologize for the system failure.
And here’s something that’s important for all businesses to know about customers: they don’t need you to be perfect. You can recover from problems and deliver good (or great) customer experiences even when things don’t go as well as they should. What matters most of all is showing that you care, just like Rewe did. Customers can be very forgiving if they know you are trying your best to put them first.
Meanwhile, COVID-19 is raging on months later and I’m still dreaming of fast, convenient, reliable online grocery shopping in Germany. Does it have to stay a dream?
This is where Picnic enters the frame. After a few years of success in the Netherlands, they’ve established a beachhead in the cities of Neuss and Düsseldorf with planned service rollouts for the surrounding areas.
And this is when I realized that Picnic has a particular brilliance for customer experience. Picnic’s website allows you to enter your postal code to see if your area is already being served. If not, you can enter your email address to sign up for the waitlist. I can now look forward to being notified as soon as Picnic is available in my town. As of May 2020, they are operating in a town so close I could get there by bike.
Picnic’s waitlist is a great example of letting prospective customers show you where market demand exists. It’s also a way to start building a customer relationship with people even before they become customers. I am thoroughly enjoying the sweet anticipation of Picnic’s arrival. I am rooting for them to succeed. I am already a customer and a fan of a service I have never used. Not even once!
That’s the power of a strong brand promise aligned with great customer experience. And that same kind of power is available to any business willing to commit to customer centricity and building their USP around it.
The COVID-19 crisis has suddenly changed online shopping from the “nice-to-have” category to an absolute must. We don’t know yet how long this pandemic will last but we already know that something similar could happen again. The changes in consumer behaviour resulting from lockdown and the massive shift to online will almost certainly become the new normal.
Picnic’s arrival in Germany puts an end to complacency for our supermarkets. They might not appreciate having a new, disruptive competitor on the scene when their margins are already thin. But digitalization has been a key theme in business for many years. The only real question was when and how to proceed with digital transformation.
This might sound like it’s all gloom and doom for German supermarkets, but I promise that this is a positive COVID-19 story. Sometimes it takes a crisis to jolt us out of old familiar habits. New competition can do the same for businesses. It sharpens creativity and leads to new innovations, higher standards, and ultimately better products and services for customers. It is a force for good in the world.
Picnic is doing very well by doing good. They are finding creative solutions for delivering value and better serving customers in an evolving marketplace. They were ready for the challenges of COVID-19 even before it became a crisis. Let’s review some of the key parts of Picnic’s success formula:
A brand built on strong values
A commitment to customer-centricity
A thorough understanding of customer problems
An innovative, feasible and sustainable solution
A clear and compelling value proposition
A plan for delivering great customer experiences
A way to create powerful emotional connections
Startups like Picnic are showing us the future, but you don’t have to be a startup to be agile and innovative. You don’t have to wait for the right technology to come along to start serving customers better. Digital transformation starts with people. It’s a cultural shift that allows us to create more value and better customer experiences in a highly connected world. It starts with a decision to put the customer first.