Asda shoppers are set to see major changes to the supermarket's online service as the retailer pushes ahead with plans to turn around its performance.
The supermarket giant is investing in new technology designed to improve everything from ordering groceries online to home deliveries.
Asda has struck a deal with Ocado to overhaul its online grocery operations, with the UK's third-largest supermarket set to introduce Ocado's Smart Platform technology across its website, app and delivery network.
The rollout will begin in 2027 and will cover online shopping, in-store order picking and home delivery services.
The move forms part of executive chairman Allan Leighton's wider efforts to revive the business.
Mr Leighton, who returned to Asda in late 2024 after previously leading the supermarket more than 20 years ago, said earlier this year that there was still "plenty to do" to complete the retailer's recovery.
Asda said Ocado's technology should help increase the number of delivery slots available to customers while allowing stores to process orders more efficiently.
The supermarket currently handles more than 700,000 customer orders every week.
Russ Mould, investment director at AJ Bell, said the agreement was a significant boost for both companies.
He described the deal as "some much-needed good news" for Ocado after a challenging period, while adding that it could help Asda strengthen its position against rivals Tesco and Sainsbury's.
The move forms part of executive chairman Allan Leighton's wider efforts to revive the business
| ASDA"For Asda, this deal may give it some heft to take on Tesco and Sainsbury's at a time when its position in the UK groceries market is looking fragile, while for Ocado it is a ray of light after a difficult period for the business," he said.
Mr Mould noted that the partnership falls well short of the ambitious vision that once surrounded Ocado, when investors believed it could become a global leader by licensing its technology to supermarkets worldwide.
Despite a rise in Ocado's share price following the announcement, he pointed out that the stock remains more than 90 per cent below the record highs reached in 2020.
Mr Mould said shareholders would be hoping the Asda agreement marks "the first step in a less grandiose but still meaningful growth story" after years in which the company faced operational challenges, rising costs and setbacks with key partners.
Despite the partnership, Asda will retain full control over its pricing, product range and online operations
| PAAsda will still retain full control over its pricing, product range and online operations, regardless of the partnership.
Home delivery and click-and-collect orders will continue to be fulfilled through the supermarket's existing stores and distribution centres.
Customers using rapid delivery services such as Deliveroo, Just Eat and Uber Eats will also see no changes, with Asda staff continuing to pick orders before they are collected by third-party couriers.
Mr Leighton said: "Partnering with Ocado will strengthen our online offer and provide a consistent and high-quality experience for millions of shoppers, from order through to delivery."
Ocado Group chief executive Tim Steiner welcomed the agreement, saying: "We're delighted that Asda has chosen Ocado to support the next phase of their online growth."
Partnering with Ocado will strengthen Asda's online offer
| GETTYHe highlighted the intense competition facing British grocers, noting: "The UK remains one of the world's most competitive and fast-evolving online grocery markets, where technology, scale and continuous innovation are increasingly important for retailers looking to maintain leadership positions."
The Smart Platform already handles in excess of 70 million orders per year globally, supporting grocery retailers across 11 countries.
Ocado's fulfilment technology is currently deployed in more than 1,000 supermarket stores worldwide.
Asda products will not appear on the Ocado website under the arrangement.