Significant changes in the business environment and markets
Some major trends are impacting ICA Gruppen’s operations. Among the main ones are extensive and fast digitalisation, changed consumption patterns and an increasing focus on health and responsible behaviour.
Competition in grocery retail is tough and has ramped up in recent years. The main reasons include the growth of discount chains, e-commerce, continued blurring of industry lines and tougher competition from other channels – not least, restaurants and cafés. In cities the big shop is on the decline; instead people are doing a growing percentage of their shopping when on their way to and from work. There is a simultaneous increase in demand for high-quality ready meal solutions.
ICA Gruppen’s response to changes in the market
- Better availability through digital channels
- Complete meal solutions
- Menu baskets
- Ensuring the right price perception among consumers
Environmental, social and financial sustainability have become “hygiene factors” and are also driving growth. Responsibility, environmental impact, business ethics and control of both a company’s own organisation and its external supply chain are increasingly important factors. Consumers are demanding more sustainable products and services, and suppliers want to work with innovative, long-term and stable customers. Being a responsible employer is and will continue to be an increasingly valuable asset among employees of today and tomorrow.
ICA Gruppen’s response to changes in the market
- Expanded organic and locally produced offering and climate-smart services
- Communication in stores and pharmacies to guide customers to sustainable choices
- Initiatives to reduce food waste in stores, warehouses and at home
- Environmentally and quality-certified stores, sourcing and logistics processes
- Ambitious work to reduce climate impact
Among the most obvious trends in society is an increased focus on physical and mental health. The health aspects span a broad spectrum of areas where diet, exercise and finding a balance in life are increasingly important lifestyle issues. Interest in food ingredients and production methods has grown significantly in recent years. But the experience with food should not be complicated. Today’s consumers demand food that is both healthy and delicious. What we eat and consume – both products and services – must reinforce a desired image, lifestyle and identity.
ICA Gruppen’s response to changes in the market
- Increased range of healthy products
- Environmental and health labelling of products
- Advice on health and medicines in pharmacies
- Minutkliniken (minute clinics) adjacent to stores and pharmacies
Fast digitalisation and technical development are greatly impacting both consumers and companies. In retail, every part of the value chain is affected – from product development, sourcing, logistics and product supply to product offerings, marketing and interactions with customers. Mobile devices, constant connection and faster processes are completely changing the prerequisites, and presenting opportunities as well as challenges. Digitalisation is also driving changes in purchasing behaviour and allowing new players with new business models to emerge.
ICA Gruppen’s response to changes in the market
- Major focus on e-commerce
- Using data for customised marketing
- Sweden’s biggest food website – ica.se
- Joint loyalty programmes
- Digital banking services
- Same-day home delivery of medicines
From a demographic perspective, ICA Gruppen’s markets are affected by ongoing urbanisation, immigration and changes in age demographics. Meanwhile, the percentage of single-person households continues to grow. These trends are having a significant effect on what people consume, as well as when and how.
ICA Gruppen’s response to changes in the market
- New stores in metropolitan areas
- Development and adaptation of assortment and offerings to match changes in demand
Rapid technical development and major changes in consumption patterns are reducing predictability, making long-term planning more difficult. Agility is therefore increasingly important, especially for large companies. The changes taking place require significant leadership adjustments, an emphasis on learning and always being able to secure the right talent.
ICA Gruppen’s response to changes in the market
- Increased focus on innovation and agility
- Leadership adjustments
- Securing the right talent – short term and long term
- Increased competitiveness through diversity
