- Consumers have not established loyalty to an online grocery store. A new survey from RichRelevance found 36% of consumers now shop at multiple online food retailers. In addition, more than 60% of consumers who don’t shop for food online are willing to look at new grocery companies when they do.
- Among online grocery destinations, Amazon attracts twice as many shoppers (60%) as traditional supermarkets (27%) and big box retailers (27%). Amazon attracts four times as many shoppers as wholesale clubs such as Costco, with 15%.
- Opportunities still exist in the segment because 56% of Americans have yet to shop online for groceries. And 60% of those who said they have shopped for food online said they do so rarely.
Loyalty is fleeting in retail and food brands. Add in consumer unfamiliarity with online grocery ordering and a multiplicity of offerings — they can choose from national retailers such as Amazon and Walmart, in addition to local supermarkets — and shoppers have a lot of options to chose from.
The keys to attracting customers in the online environment include price, selection, ease of use, pickup and delivery. These are all part of the equation. But a big name such as Amazon has an advantage in that it already draws significant online traffic, and its Prime loyalty program and Whole Foods Market ownership help boost its basket sizes and sales. Walmart also has a big name and many convenient locations for its expanding curbside pickup and grocery delivery programs.
For other chains or independents, they need to educate themselves in online commerce, such as by using attractive and simple interfaces. They can improve their logistics and efficiencies on the last mile by taking advantage of Instacart and Shipt to get orders to consumers. Retailers also must determine whether they need to target specific consumer segments such as millennials, and if they prefer computers or mobile. Additionally, they must get vendors in the loop for their products, promotions and expertise, while ensuring the quality of fresh foods.
Getting shoppers used to loading digital coupons onto their loyalty cards also can keep customers coming back to the store or the online site, as these purchase incentives can be used both places. Coupons also have the advantage in helping to increase basket sizes, an obstacle in online grocery shopping.
The RichRelevance survey reported that 62% of consumers said they spend less when they shop online, while 39% cited fewer impulse purchases as a benefit of e-commerce. It’s notable that the survey reported percentages of shoppers at the various online grocery retailers and not how much they bought from them.
Digital shopping is a huge opportunity for grocers to deliver personalized experiences. Retailers can study consumer behavior thanks to data from online clicks, shopper loyalty programs and engagement with mobile apps to better tailor their offerings — and how they present them — to their customer base. In the increasingly competitive grocery world, savvy data usage could help secure loyalty in the digital frontier.