The Nordic online grocery market landscape

And just like that, the grocery market is hot once more. Despite it being one of the first industries to be disrupted by digital, Amazon’s acquisition of Whole Foods has sparked a revived interest in the space, as people begin to consider the state of the landscape and what the further consequences of Amazon entering this space could be. The Nordics already has a fairly competitive online grocery market, in this post we take a deeper look at the current leading players.

But first, some context. Dealroom has 667 online grocery companies in their database, with 307 of these European. According to Dealroom, just 22 of these are Nordic. This demonstrates that the Nordics is a relatively small player in this market, with just 3.3% of the global players and 7.17% of the European market.

This is also reflected by the fact that online groceries is only the 6th most invested in sub-sector of food and drink in the region, representing just 9.46% of the investments into this vertical in the Nordics.

Even still, there is some action worth noting, not least that just a couple of days before the Whole Foods announcement, Norwegian Kolonial raised a further 150MNOK in addition to the 150MNOK they raised towards the end of last year, meaning that they’ve already raised over $35 million in total, demonstrating the capital intensity of this sub-sector. Kolonial are now the second most well-funded Nordic company in this space, just behind Swedish Mathem and ahead of Matsmart.

These two are certainly worthy of their own individual mentions too. Mathem is Sweden’s largest online grocery store with above SEK 1 billion in sales in 2016, whereas Matsmart is also sitting at the crosshairs of the waste reduction space as well, as the company buys up large quantities of products that are soon-to-expire or that would be discarded for cosmetic reasons, and sells the products online well below normal retail prices.

Another worth mentioning is Linas Matkasse, Sweden’s largest meal kit delivery company, according to Crunchbase they have a total turnover of over $100 million, delivering a total of 55,000 bags of groceries every week in Sweden alone. Another company worth watching in this space is Axfood. Axfood is a publicly trading company that is a traditional offline retail grocery store, but one that has recently ventured into the online ordering arena, not least through their acquisition of Mat.se.

Update and Edit: It was remiss of me not to mention the biggest player in the Danish market, Nemlig.com. Founded in 2010, Nemlig.com is Denmark’s largest and most successful online supermarket. Despite their absence on most tech databases, they’ve also raised between $35-38 million in total (depending on exchange rates), placing them at Kolonial levels. (Thanks to Jacob Simonsen for nudging me on this)

Due to the nationalised nature of competition, market consolidation through acquisitions is also fairly common. In recent years we’ve seen Matvaren.se, RetNemt and Mat.se all snapped up by ‘competitors’ (MatHem, Linas Matkasse and Axfood respectively). An active exit market is always welcomed, however, as the market continues to mature it will be harder and harder for new entrants to get a meaningful slice of the pie that could set them up as a likely future acquisition target, meaning the action may have calmed for now.

So far, we’ve only witnessed companies rising to the top on a country level, with none of those mentioned in this analysis having anywhere near any sort of Nordic dominance. If one can transition to this level, then who knows, they might one day end up being Amazon’s first Nordic acquisition, joining the rest of tech’s big five in Nordic shopping, quite literally.

 

Neil S W Murray founded The Nordic Web in 2014 in order to provide the Nordics with the quality coverage it deserves. As well as being Founding Editor of The Nordic Web, Neil is also an active community builder in the region, participating in a number of initiatives, and has previously worked for Tech.eu.