Combined food and general merchandise offer planned for late October, challenging Tesco’s strength

Asda will unveil its Asda Direct multichannel offer in late October, in time to reap a share of growing online Christmas spend.

The retailer has ploughed a “substantial” sum into the venture as it squares up to take on the might of rival Tesco Direct.

Asda chief executive Andy Bond told Retail Week that the service will combine food and general merchandise ranges. It will debut with an initial 750,000 non-food products and the aim is to take that figure to more than 1 million next year.

Bond described Asda’s existing online general merchandise offer as a “patchwork quilt of micro sites”, such as music and video or electricals. The web relaunch will enable the grocer to offer a “significantly expanded portfolio of products that all seems seamless to the customer”.

Offering shoppers value was a prerequisite for the online service, said Bond, but there would be no corner-cutting on technical requirements.

He said: “It will of course be low-priced, but things like service, easy navigation and information are also important because you’re not touching and feeling the product.

“Those things are important because customers won’t have a colleague there to ask whether an item is right for them.”

Direct will also include a catalogue and in-store kiosks. The trial catalogue, similar to Argos’s and Tesco’s, will carry about 10,000 products.

Initially, Asda Direct’s non-food products will be delivered to customers via a third party. From next year, the in-store kiosks will open, giving customers the option to have products delivered to their nearest shop.

Bond said: “Everything I’ve read and experienced says that the winning strategy is to connect your online with your bricks and mortar.

“It gives customers yet another reason to visit the supermarket. If I’m going to pick up my guitar that I’ve bought online, then I’m likely to do my food shopping while I’m there.” He added: “We’re not trailblazers in this – we are a very good competitor.”

Verdict Research senior retail analyst Malcolm Pinkerton said: “Asda will have a fair way to go to catch up with Tesco, but its launch will increase price competition and choice and its value model should give it a different angle.”

Verdict expects e-tail sales to reach£44.9 billion by 2012, accounting for almost 14 per cent of total online spending.

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