Michiel Muller, Co-Founder of Picnic – NOAH17 London

Michiel Muller, Co-Founder of Picnic – NOAH17 London


Oh Good afternoon yeah, let’s talk about something that we do Every week namely going to the supermarket and buy groceries Although we’ve started an online supermarket and that will be something from the past because we bring all your groceries for the lowest price free to your door very simple So you don’t have to go to the supermarket a couple of years time now. There are two reasons Why we started this first of all? Because the food system is rather broken There’s a lot of food waste. It’s a very inefficient model a lot of food waste We drive with our cars to the supermarket every time so there’s a lot of small particle emissions in our neighborhoods And there’s also a lot of time waste going to the supermarket back and forth to the cars a couple of times a week lastly if You look at smaller brands that are a couple of year round smaller vendor tried to get into this big supermarket business very difficult So there are a couple of huge problems that we have to cope with in the future to avoid all of this That’s the first reason second reason is of course the business opportunity let me take you to this slide on the left hand side you see all the markets like fashion and electronics and books and travel etc Everything is now 30 40 50 percent online Except groceries used to be one percent growing to eight percent so it’s going times eight But still very very small in the middle section you see that the store leader so the market leader in the offline world is Seldomly the market leader in the online world. That’s not only true in Holland That’s the same across Europe or across the world so it’s not very logical because you would expect That somebody who has a market share that’s really dominant in the offline world could transfer that easily to the or not well It’s not the case and the last column. That’s of course the most important in terms of business proposition Is that the market for food for groceries is as big as all the marks together? so if you add fashion and Travel and books and electronics together Then you get groceries So in by far the biggest market the penetration of online is by far the smallest and the Internet is Coming, that’s what they say at least So that’s a huge business opportunity. Now you say of course that’s logical. Why would you go buy your groceries online? It’s not logical because groceries 80 times 80 percent of the time is always the same It’s heavy you have to carry it you have to bring your milk and your coke and your stuff to your to your fridge yourself Whereas fashion is more fun to do, but it’s already 30 percent online So it’s not logical now was it always like that not really because of course we had the supermarket It’s a really efficient model to bring very Small price items to your fridge because we as customer do all the order picking all the distribution But we used to have these guys the milkman Nice guys. They came to your door It was free delivery their assortment was maybe too big and they were a bit expensive But the idea itself was great before the supermarkets came now This is exactly the mobile that we have chosen what you see here Is that we still have a course on the left hand side our suppliers they bring it to our fulfillment center? We do the order picking and then we bring them to your doors with these small electrical vans 100 percent electrical everything Managed by your own smartphone. We only have an app and we bring it to your door for free Now I will explain you a bit how that works first of all we only have an app with free delivery Meaning we take away one of the most important elements. Why people do not do groceries online That’s because they want don’t want to pay for delivery the second element that I’d like is waiting for hours on their groceries We have a 20 minute time frame So it’s a really small time window and on your app you can see over like where the little van is You can also see who the delivery guy is you can see that’s Marco if you press on the picture of Marco you see his favorite quote of the day Completely useful useless, but people like it and they really get a sort of a notion of who’s coming to their doors That’s an important part now if you look at the the way it works It’s inter to explain it a bit you see of course people Ordering via our app at home They have to finish their order by 10 o’clock at night pay online And then we start only then ordering at our supplies meaning that if we need 100 steaks the next day we only order hundred steaks at the butcher, so we don’t have any food waste The guys delivered to our warehouse in the morning We do all the order picking we put them in totes of course also ambient frozen killed everything together Then we bring them to a local hub and from that local hub as you can see? Here we bring them with small electrical vents to the people’s homes Meaning you have eliminated two very important things It’s just a very small time frames only 20 minutes and it’s to the minute precise if you follow the grocery radar and Secondly you have avoided delivery costs so that means that you really created the mass market the vehicle that you see is something that we have Generated ourselves we completely engineered ourselves It’s really made only for online grocery delivery limiting stop times and making it more efficient So people are happy and of course can do other things with the time Now when we started this we said to the Dutch consumers. We’re going to launch this next week We were all over the pages all in the press at night. We were in the National TV show and there were only three brands left by that time We didn’t had a bananas sold yet, so it was really funny But what happened next day this interesting to sell because we said we’re going to launch an armored store Which is sort of a middle sized city in the middle of Holland? We said we aren’t going to launch an answer and this happened next day These were all the people in Holland that downloaded the app just by hearing There’s a new company is called picnic they bring all your groceries at the lowest price free to your door, so Apparently, this is something that people really like Then this happened we have these runners as we call them our delivery guys. This is sort the the perfect sons-in-laws and Daughter-in-laws because the 30% these girls with us, they started making pictures together with their runners and put them on Facebook Why? Because if somebody brings your groceries to your door your fresh cucumbers and your fresh vegetables etc You would like to have somebody at your door who is really nice who looks nice. Who’s friendly who takes time etc so that’s a very important part of the delivery and Having these runners with us. It’s very important of course kids like it. They follow the grocery radar. They see what’s happening they come and help and We do all sorts of thing. This is our app very simple very graphical only mobile net promoter score 85 it’s not a typo and This is the story basically in one slide what happens if you have a very high price Premium product market namely groceries fulfillment costs everything if you replace it by a mass-market approach so in one year’s time we had the mark at times five and This is an example where we did five on the deliveries in that market that day today a year later. We do a thousand deliveries So really this has grown because you now have a product that everyone can buy and not only the rich and famous Now this led to a financing round now in March we we did a financing around 100 million euros and Also, of course we have to build the whole infrastructure our own cars our own fulfillment center We have to grow the business very rapidly what’s going quite rapidly because we now do sort of 5% week on regrowth meaning that we double every two months takes a bit of Gray hair to do it, but this is a Sort of the way, it works. We started in amis for this This is the small country in the middle of Holland, and we said well, let’s just test a few neighborhoods Worth quite well, so we expanded a bit, and we said let’s do the neighbors of ours for just two small Cities next to it it also works And we said let’s go to a bigger city Utrecht you takes quite a big city work as well Let’s try see there’s more sort of a new built area on Mira Also worked and then we said well We have to do this because this is something that people really like this is apparently something that people like doing and if we can make that happen and if we can have all the Efficiencies in the system we will have the same bottom line as a normal supermarket business. Thank you very much You

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