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Coop Danmark Introduces Crowdfunding

Coop Danmark has started offering its shoppers the opportunity to fund new product developments for its suppliers. In this way, the Danish grocery leader wants to act as mediator between its around 1.7mn members and its primarily small Danish producers. There are two ways for Coop members to help suppliers fulfil their dream projects. They can lend them DKK1,000 (EUR134) or more in exchange for interest or support small producers with DKK100 (EUR13.4) or more, granting them access to early samples and visits to the production facilities.

Coop has tasked Denmark’s largest crowdfunding platform Lendino with delivering the IT solution for the project.


Opinion

Low Risk – Possibly High Reward

An initiative like this fits perfectly with Coop’s agenda to make 50% of its total assortment across all chains exclusive by 2018. Regardless of how many of its members choose to invest, it’s a clever PR move which is bound to boost its image as the champion of Danish quality food, among shoppers and producers alike. It will also give the retailer an idea of how far shoppers are willing to go to innovate the Danish grocery industry.

In other words it’s a small investment project for Coop and if successful it could give it some major benefits. The access to new unique products and stronger ties to its inventors is the most obvious one, but increased loyalty among the investing shoppers would be of equal value. It is also a way for Coop to outsource the assortment selection process and adjust its products to shopper demands almost without lifting a finger.

So how likely is it that shoppers would invest their money in projects like these? After all, we’ve seen crowdfunding as a model surging in recent years through platforms like Kickstarter. The only question is whether food products can create the same commitment and excitement as typical investment genres such as media, culture and technology. I find this unlikely. However, the ability of Coop members to close the ranks should never be underestimated. During two weeks in 2015, as part of a campaign, they managed to buy 15% more organic groceries at Coop stores to enable the organisation to contribute DKK1mn towards the further development of organic agriculture.

Topics: Coop Danmark (DK)