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If you’ve ever visited the Netherlands, you’ll know that the supermarkets are some of the world’s best. Wide variety, locally grown produce, and quantities of candy that would make Willy Wonka blush. But the fact remains, busy supermarkets, no matter how well designed, can be stressful, a chore, and an inconvenience, especially during socially distanced times.
Enter Picnic: a Dutch, online app-based supermarket that delivers exclusively to your door.
Picnic’s ethos is that while shopping can be an acceptable way to spend your time, there are nicer things to do, like walk your dog, or watch the latest Korean TV series.
The Picnic team noticed that in recent years, supermarket shopping has become less convenient. Shoppers have to do more and more: They fill their cart, pick out the most beautiful vegetables with the longest expiry date. They wait in snaking queues, self-scan their goods, weigh their fruit, they even make sure there isn’t an incorrect item in the bagging area. First-world problems, sure, but when life gives you lemons, why not get them delivered?
In this article, we’ll fill our basket with questions for Picnic’s CEO, Michiel Müller, and Product Owner for Payments, Jelmer Borst, to tell their growth story and share how we’ve helped them with payments.
Michiel: When we started Picnic back in 2015, online grocery delivery was virtually non-existent and only accounted for 1% of the market. At the time, it was a premium model with high costs. We drew a blank canvas and quickly concluded that more people would buy groceries online if they were cheaper and delivery was free.
We had just four delivery cars. There are now more than 1000 cars driving around in about 120 Dutch towns, with hundreds of thousands of customers and a monthly expansion to new cities.
Michiel: I would have to say the series of firsts we experienced in the early days of the business. Our first customer, the first iteration of our app, the first software implemented for the app, through to our first vehicle.
Michiel: Tech is ingrained in everything we do. We have over 150 developers in Amsterdam and build everything ourselves. From the app, our robotized fulfillment center, to our payment flow. This is why when it came to the payments side, we wanted to work with a partner, not just a supplier. Adyen has become that partner.
I think what’s important in a technology partner is that they really understand the business side of things and that their technology is there to serve the customer. Remember, it’s customer convenience that counts, and not the technology itself.
"Adyen, is of course, at the forefront of technology, like we are at Picnic. We build our own software, Adyen does the same, and the granular level that they have really enables us to bring the best convenience and payment experience to our customers."
Jelmer: We can talk specifically to one in payments. Credit cards aren’t really common in the Netherlands, and Dutch debit cards don’t have visible 16-digit PANs to use online. This brings a few problems: shoppers have to pay in some ‘less-than-seamless’ ways. One such example is with online banking. Shoppers are redirected away from the Picnic environment, they’re prompted for login details, then brought back to our website. The tech comes from a time when online payments were new, and people were accustomed to wire transfers. If you designed a new payment method from the ground up today, it would work differently.
Jelmer: We’ve already been active for 5 years, but in that time, we never processed cards, which for many companies is pretty odd. Then suddenly, you’re expanding into a new country with new payment methods, and everything needs to work from day 1. You start to question everything: How does PCI work? How does the storage of these card details work? Because you’re so used to tweaking iDEAL or direct debit, which is much simpler to deal with. Cards have many different routes: You can do merchant-initiated transactions (MITs), 3DS may or may not pop up - there are many aspects. So we’re constantly bombarding your team with questions and always getting an answer. This helps us a lot.
Accepting Dutch debit cards online without PAN was also a big reason we started working with Adyen. As we process more volume, we see differences in uptime, new retry strategies, as well as the scope Adyen works with, and the extra mile you go. All-in-all, I think the key for us was that with Adyen, we can think about innovation together.
Picnic employee delivering groceries.
Jelmer: On one aspect, we didn’t see too much, which is a very good sign because that means we are not degrading any experience. Instead, we see very high uptime and improved experience for our customers and our team.
We see uptime combined with success rates as the most important thing for us as a supermarket.
Michiel: Of course, our favorite feature in the Adyen platform is the payment method we created to help our customers use their Maestro debit cards online.
From the Picnic app, shoppers can configure their payment cards. After this enrollment step, the card can be used as a card-on-file with the same functionalities as a credit card (e.g., increase/decrease authorizations, refund). This lets customers follow the transaction in detail, and in turn, they only get one line on their bank statement, summing up all the transaction details.
Michiel: We’re a young company, and today, any new company has to have sustainability at its heart. At Picnic, we’re no different; the environment is extremely important to us. We deliver groceries in environmentally-friendly electric cars; they’re quiet and keep CO2 emissions to a minimum. We drive through the streets based on smart routes, meaning we can take groceries for an entire neighborhood on one trip, saving extra journeys. Having groceries delivered also cuts out our customers’ need to drive to the supermarket.
Since day one, we’ve worked hard to cut out food waste. We don’t have to store things like bread, fruit, and vegetables in the supermarket. Instead, we order from our suppliers what our customers have ordered from the app. Take fresh bread as an example; when the Picnic checkout closes at 10 p.m. the night before, our baker Klaas Fuite bakes the loaves of bread our customers have ordered for the following day. That way, we never have to throw anything away.
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