Browsing by Subject "Kesko"

During the past few decades, online shopping has grown steadily and increased its share of all retail sales. As internet connections have become more common and the selection of available online services has diversified, an increasing number of consumers have started to purchase different products online. Buying online has many time-related benefits compared to traditional retail as it enables the consumer to make purchases whenever and wherever. Yet, online grocery retailing has been relatively small-scale in both Finland and abroad compared with other product categories. In the past few years, however, the competition has become more intense as the few dominant Finnish grocery retailers and several smaller businesses have developed their online business models. In this study, I focused on one of Finland's leading grocery retailers, Kesko, and the customers and spatial characteristics of its online grocery services. The aim of this study was to find out 1) whether the accessibility of services affects the choice between an online store and a physical retail outlet in the case of grocery retail, 2) whether the widely accepted socio-economic characteristics of typical online shoppers find evidence in the case of choosing online grocery retail over a physical store or the frequency of online purchases and 3) how Kesko's online grocery retail has spread in the Helsinki region during the couple of years it has been in operation and where its potential new market areas in the region are. The MetropAccess time-cost-matrix for the Helsinki Region was used for the accessibility calculations. Travel times were calculated from all inhabited cells in the area and only from Kesko's online store's customer cells to the closest Kesko grocery store and separately to the closest store when all grocery stores were taken into account in the Helsinki Region. In some previous studies, urban living environment and dense service network have been observed to increase the probability of being an online shopper whereas poor accessibility to services increases the intensity of online shopping. In other studies and national statistics data, a variety of socio-economic attributes have stood out as prominent characteristics of e-shoppers. These include: young age (age groups 25-34 and 35-39), higher education, student status and high income. In addition, I have included the percentage of underage children of a cell's inhabitants in the analyses as Kesko's own data points very clearly in the direction that families with children are an important customer group to online groceries. The socio-economic variables of the region's inhabitants were mostly drawn from HSY's SeutuCD 2015 and Tilastokeskus' Paavo zip code data. I made correlation analyses on the YKR-grid level where the other variables were 1) the percentage of online customer households proportioned to cell's population in the whole region and 2) the intensity of online shopping in customer cells proportioned to population, and the other variables were the socio-economic variables of the population and the travel-time accessibility of grocery stores. The statistically significant Spearman's correlation coefficients were not very high, but weak connections between variables could be found. Customership of the online grocery store correlates negatively with travel time accessibility and the intensity of online shopping correlates positively with accessibility, which is in line with previous findings in the literature. Of the socio-economic variables chosen for this study, the ones that correlate the most with online shopping are income (with shopping intensity) and the percentage of 25-34- year olds (with customership). Finally, I analysed some potential future areas for growth for Kesko's online grocery business in the Helsinki Region based on the previously mentioned socioeconomic variables and accessibility of grocery stores in the study area. One weakness of the study was the availability of detailed enough socio-economic data when compared to Kesko's own YKR grid-level customer data. Some of the socioeconomic variables where derived from larger spatial units such as zip codes, which weakens the reliability of the correlation analyses. However, the grid-level examination is quite coarse for the capital region as well, and especially in this case, when the customer dataset itself was quite small. The accessibility of grocery stores is relatively good in the whole study area, so the study might not bring out the impacts of accessibility of physical services to online shopping as explicitly as might really be the case if the study was carried out in an area or with product categories where physical accessibility varies more. Moreover, the study may not have sufficiently considered the special characteristics of online grocery retailing when compared with other product types. Due to the marginal status of online grocery retailing, it has not yet been studied extensively in research literature. The results, however, do partly support previous findings of the connections between specific socioeconomic variables and the accessibility of services, and the customership of online stores and the intensity of online shopping activities.