Jeans, televisions, diapers, vacuum cleaners, even cars are simply a few items people are delighted to purchase via mobile apps or the browser on their laptop. And a fast number of consumers are adding food to this same shopping experience.
In the past year — almost mirroring the time of Amazon’s purchase price of Whole Foods — with desire for the variety of U.S. consumers need for shopping online has jumped from 6 percent to 16 percent, according to NPD Group, a worldwide consumer-information company.
The sharp rise in online grocery shopping was not so much Amazon’s doing because it had been the answer to Amazon’s invasion of the supermarket industry. The Seattle-based e-commerce giant’s buyout of a beloved, if embattled, grocery chain was a signal to the rest of those in the industry to place their foot on the accelerator.
“We’re at a tipping point,” said Darren Seifer, NPD’s food and beverage industry analyst. “Amazon really spurred other players to their game up. It had a massive effect in the grocery industry to make e-commerce easier to use and more broadly available.”
All of a sudden, grocers are diving headfirst into technology that other kinds of merchants have long embraced: online ordering, at-store pickup, free shipping, and much more.
Market leader Kroger reported this past week that its electronic sales increased 66 percent in the past quarter compared with one year ago. Giant Eagle, central Ohio’s second-largest grocer, is privately held and does not report earnings, but the Pittsburgh-based merchant said its Curbside Express service, established in 2015, has witnessed continuous double-digit growth.
The e-commerce efforts are exactly what customers want.
Another key to this e-commerce growth for grocers is shipping. Just about everybody is running to provide this service to their customers. Costco, Meijer, Walmart and many others have begun delivery partnerships.
Delivery provides a great solution for consumers, because people want to spend more time with their food preparing it, cooking it, enjoying it – however they don’t really want to devote the necessary time in stores shopping for it.
Shoppers want groceries made easy: this is what you are having for supper, for lunch, and here is the breakfast we have for you. That is where consumers are going.
E-commerce has provided some surprises for retailers. The normal online order is a lot bigger than a typical in-store purchase and includes a greater proportion of fresh food — produce, meat and dairy.
Grocers will continue the rapid rate of technology adoption, especially in markets where customers have over a dozen choices to shop for groceries. Grocers have catching up to do when it comes to meeting customers where they want to shop.
Grocery stores, generally speaking, have been the final frontier to accommodate to e-commerce, and there’s just a ton of rivalry forcing them to maintain. Grocers have a good deal of space to grow e-commerce also.
Over 90 percent of individuals still end up in grocery stores weekly. But rising generations — millennials and Generation Z — will expect more convenience and more technological interaction with their preferred stores.
Tech is inherent in millennial and Gen Z, because for them, technology can answer the question: What’s for dinner?