Ocado Innovation

"We develop and utilise proprietary processes, systems and software throughout our business."

Technology is at the core of our business. We develop and utilise proprietary processes, systems and software throughout our business to improve efficiency and operations, and to provide market leading user interfaces and applications for our customers.

We did not set out to make supermarket shopping a little bit better. Our aim was to build a unique online shopping and fulfilment solution that would revolutionise the way people buy their groceries.

There was no blueprint to follow or off the shelf solution we could buy. We have built it ourselves and almost all of the software that powers Ocado is developed in-house, from the optimisation algorithms that fine-tune our daily delivery routes in the 500 milliseconds of a mouse click, to the machine learning techniques that drive our consumer demand forecasting and the real time control systems that operate our vast fulfilment centres.

To our customers we are an online retail business, albeit one that offers a level of choice, quality and service that is market leading. Our business is all about providing a customer experience that is compelling in terms of its convenience and simplicity, with our award winning websites and mobile apps.

We continue to invest in the skilled people that enable this capability, and during the year opened a software office in Krakow, Poland, to complement our UK based developers.

Having developed this technology expertise, we have built a platform of valuable intellectual property and operating knowledge over the last 13 years. It was developed for the purposes of powering a best-in-class online grocery operation. As with any valuable platform, there exists the opportunity to utilise the intellectual property in other situations and markets. The commercialisation of our technology and operating knowledge is a key strategic objective which we believe has the potential to be a significant source of value in the future. In May 2013, we announced the first commercialisation of our intellectual property with the signing of a 25 year agreement with Morrisons.

In order to retain our market leading customer experience and operating performance we will continue investing in our technology platform, adding significantly to our technology team which numbered almost 400 people by the end of the period. This investment will facilitate developing new technologies, user enhancements and improved operational processes.

Krakow, location of our new software office