Source | Retail Vision As the global retail market continues to evolve, the entry of new players often injects fresh vitality and thought into the industry. Examples include Three Squirrels, which crossed over from a snack giant to a 'lifestyle supermarket', and Iceland Lab, a frozen food supermarket from the UK. At the end of April this year, Iceland Lab's first store landed in Beijing, attracting widespread industry attention, and it recently announced a grand trial operation on June 28. Founded in 1972 and headquartered in Wales, UK, the company now holds a 17% market share in the UK and is hailed as 'the largest frozen food supermarket in the UK'. To date, the company has opened stores in around 10 countries, including the UK, with approximately 1,000 stores. The core features and strategic layout of the retail 'new species' Iceland Lab have sparked heated discussions on Xiaohongshu, where a Chinese student studying in the UK, 'Mercury Potato', shared insights. In a post titled '🇬🇧 Lazy Person's Paradise: What's Worth Buying at Iceland?', items like juicy mini sausages for £1, golden crispy potato cakes, bouncy and plump meatballs, and savory vegetarian spring rolls, all frozen foods, successfully captured the attention of countless consumers with their high cost-effectiveness (relative to local prices). As the UK's largest national frozen food supermarket, Iceland has become the go-to for many families and international students to stock up, thanks to its rich variety, affordable prices, and excellent quality, even being jokingly called a 'poor person's paradise'. Screenshot from Xiaohongshu Iceland Lab's first store in China landed at the end of April this year in the Jingxi Zhigu Park, Mentougou District, Beijing. This 6,800-square-meter commercial space is not a traditional supermarket but an innovative platform—featuring the country's first 'supply chain + MCN + AI' triple-driven industrial integration. Iceland Lab's positioning is not as a supermarket but as a 'laboratory'. In terms of operational model, Iceland Lab focuses on interest-based e-commerce, setting up various specialized live-streaming scenarios such as an import supermarket, a live kitchen, origin tracing, and foreign street scenes. It has also established a leading MCN talent service system and digital support system, aiming to achieve a scaled content matrix and a full-domain sales matrix, promoting the spread of imported foods, time-honored brands, and food culture. Image source: Xiaohongshu ID ii-gogo In terms of product composition, Iceland Lab is highly distinctive. Unlike traditional supermarkets' pursuit of a 'comprehensive and all-encompassing' product system, it focuses on a hit-product strategy, adhering to the principle of 'fewer but better' in product selection. Currently, the store's SKU (stock keeping units) is controlled within 1,000, with each category undergoing strict screening to achieve careful selection and high-quality optimization. For example, its specialty ice cream imported from countries like the UK is of superior quality and unique flavor. At the same time, the base also brings together many domestic good products, introducing well-known time-honored brands such as Donglaishun and Shunxin, achieving a clever fusion of imported ingredients and local time-honored brands, and building a 'buy globally, sell globally' dual-circulation network. Image source: see watermark Additionally, Iceland Lab stores offer consumers a unique interactive experience. Consumers can participate in live-streaming interactions while shopping in the store, and even have the opportunity to become hosts in influencer live rooms, experiencing the entire live-streaming process and deeply feeling the new trends in e-commerce. This combination of online live-streaming and offline experience brings new shopping fun to consumers and further strengthens its positioning as an innovative consumption platform. Amid the 'complex' retail market, Iceland's exploration in China still needs deepening Currently, the domestic retail supermarket market is undergoing profound changes, showing a diversified and complex situation. On one hand, the traditional supermarket format continues to shrink, with brands like Yonghui Superstores and RT-Mart experiencing varying degrees of decline in sales and store numbers, entering 'adjustment and reform' modes. On the other hand, new retail models are emerging and developing rapidly. Sam's Club, with its unique membership model and rich, high-quality products, has become the core engine of Walmart's performance growth, with store numbers continuously increasing and membership approaching 9 million. Bulk snack brands such as Mingming Henmang and Haoxianglai, with their business characteristics of 'low cost, high turnover, strong repurchase', rely on the vast lower-tier market to achieve rapid growth in sales and store numbers. Furthermore, the development of online e-commerce platforms is also profoundly affecting the retail landscape, with the convenience of online shopping attracting a large number of consumers and changing people's shopping habits. In this context, Iceland Lab's entry into the Chinese market, despite its unique advantages, still faces some challenges in its exploration path. First, in terms of product structure and taste adaptation, Western market consumers prefer items like French fries, pizza, and fried chicken, but for Chinese consumers, Western imported products may not fully satisfy their tastes. Therefore, how to adjust the product structure and develop products that suit Chinese consumer tastes is a major challenge. Second, some Chinese consumers hold certain biases against frozen foods, with social media promoting ideas like 'frozen means inferior' and 'pre-made dishes are technology and tricks'. Even in first- and second-tier cities, busy consumers have a deeper understanding and acceptance of pre-made dishes and frozen foods. While Iceland Lab emphasizes the health concept of 'zero added preservatives', on one hand, changing consumers' inherent perceptions to accept frozen foods and pre-made dishes requires significant time and effort in consumer education, gradually shifting views through activities like science popularization and tastings. On the other hand, the domestic market has many fresh food supermarkets offering ultra-low prices and ready-to-eat delicacies, giving consumers more choices. Therefore, to win consumer purchases, it is necessary to adjust strategies to better align with their consumption preferences, such as integrating local fresh supply chains and providing a combination of online + offline fresh + frozen + ready-to-eat products and services. Third, supply chain optimization is also a key challenge. Iceland Lab is called a 'poor person's supermarket' by many consumers in the UK due to its 'high cost-performance' prices. However, introducing the same products to China requires considering tariffs and logistics costs; excessively high pricing deters domestic consumers, but too low pricing means the company faces losses. Although Iceland Lab plans to reduce costs through localized supply chains, introducing local suppliers, and cooperating with origin places like Chifeng in Inner Mongolia and Ningbo in Zhejiang for meat and seafood supply chains, maintaining the quality image of imported goods while competing with local brands on price places extremely high demands on its supply chain management and cost control capabilities. Finally, intense market competition also puts immense pressure on Iceland Lab. The domestic retail market is full of giants like Sam's Club and Hema, which have deep advantages in supply chains, brand influence, and consumer bases. Iceland Lab needs precise positioning and differentiation to carve out a share of the market. In Conclusion The future of retail belongs to those who dare to redefine boundaries. While foreign supermarkets like Sam's Club and Costco are accelerating expansion in China, Iceland Lab has chosen a different path—using live-streaming e-commerce to reconstruct the relationship between people, goods, and scenes, and breaking through the limits of sales per square meter with time-sharing operations. The collision of the global frozen supply chain with local time-honored brands, and the adjustment of Western fast food to Chinese tastes, will ultimately become nutrients for retail innovation. What is displayed on supermarket shelves is not just frozen pizza and Donglaishun lamb, but a new market that is thawing. High Energy Ahead August 19-21 · Shanghai 2025 7th China FMCG Conference 🔺