Ocado, an online UK based supermarket, saw a rapid increase in the number of orders when Boris Johnson implemented a lockdown in the entire country.
According to the company’s chief executive and founder, hackers were trying to dismantle the website and Ocado had 800,000 authentications.
Because of the rapid increase in the coronavirus cases, employees are taking leaves because they are either sick or maintaining social distance. The company hired more staff quickly to deal with the huge number of orders they were receiving.
Many customers were increasingly trying to gain access to the website by waiting in virtual lines for more than 7 hours. The company was forced to shut down the website for 2 days and for several customers the app was taken down for 5 months as well.
The CEO of Ocado explains that people who rarely bought anything on the internet besides a book or printer ink are now rapidly ordering everyday necessities online.
She added that it normally takes at least 5 days for their Christmas slots to be occupied, however this time around they filled up in almost 5 hours.
Ocado reports that their shopper base consists mainly of wealthy shoppers who bought $105-$180 worth of items during the lockdown. The average sales of online supermarkets amount to only $87.
Ocado was previously mocked for only catering to the middle-class of London who purchased rarer items, however now they are worth $18bn, which is almost the same as Tesco. In 2010, when the company entered the stock market, it had never been profitable before.
Ocado’s share price also increased when it paid $287m to two US robotics companies to upgrade its automation. However, it decreased again when Pfizer announced its vaccine.
The CEO of Ocado believes that after COVID-19, customers will be less likely to return to in-person shopping and online shopping will continue to boom.
However, critics believe that Ocado had the chance to compete with Tesco during the lockdown and prove that their robotic technology gives them a competitive advantage but it was unable to do so, because it could not deal with the rapid increase in the number of customers and orders.
The company is trying to increase the capacity of its warehouses from 450,000 orders to 655,000 orders, however, it will be a challenge competing with Tesco who only needs to hire more workers to deal with surges in orders.