{"id":3715,"date":"2018-05-15T15:02:49","date_gmt":"2018-05-15T23:02:49","guid":{"rendered":"https:\/\/www.rangeme.com\/blog\/?p=3715"},"modified":"2021-10-07T15:13:43","modified_gmt":"2021-10-07T23:13:43","slug":"e-grocery-convenience","status":"publish","type":"post","link":"https:\/\/www.rangeme.com\/blog\/e-grocery-convenience\/","title":{"rendered":"E-Grocery Delivers the Convenience Consumers Crave"},"content":{"rendered":"<p><span class=\"dropcap\">K<\/span>aboom!<\/p>\n<p>When Amazon announced its stunning acquisition of Whole Foods Market last year, the news jolted grocery retailers. It forced them to prioritize their own e-grocery strategies to stay competitive in an industry already undergoing tremendous change. Amazon\u2019s acquisition enmeshed e-commerce and grocery as the future of food retail, impacting retailers, consumer packaged goods (CPG) suppliers and how consumers shop.<\/p>\n<p style=\"text-align: center;\"><strong>U.S. e-grocery sales could reach $100 billion by 2022<\/strong><\/p>\n<p>Online grocery shopping is set to soar over the next decade. According to Food Marketing Institute and Nielsen, \u201comnichannel shopping has passed the tipping point\u201d and they predict U.S. online grocery sales will reach $100 billion as early as 2022, three years earlier than previous estimates.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_1');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_1');\" ><sup id=\"footnote_plugin_tooltip_3715_1_1\" class=\"footnote_plugin_tooltip_text\">1<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_1\" class=\"footnote_tooltip\">Anderson, George. FMI says switch to online grocery sales going faster than expected. RetailWire. January 30, 2018.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_1').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_1', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script> Currently, 25% of U.S. households shop for groceries online (vs. 19% in 2014); within a decade, that figure will shoot up to more than 70%.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_2');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_2');\" ><sup id=\"footnote_plugin_tooltip_3715_1_2\" class=\"footnote_plugin_tooltip_text\">2<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_2\" class=\"footnote_tooltip\">Daniels, Jeff. Online grocery sales set to surge, grabbing 20 percent of market by 2025. CNBC. January 30, 2017.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_2').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_2', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script><\/p>\n<p>This means e-grocery will only grow in strategic significance, so it\u2019s time for retail companies to prepare for inevitable change to the grocery sector.<\/p>\n<p><strong>E-grocery saves consumers time and effort in stores<\/strong><br \/>\nAlready consumers are relinquishing the need to travel to a brick and mortar grocery store, find a parking spot, wait patiently in a checkout line and carry heavy grocery bags. Instead, their products arrive in their refrigerator, on their doorstep, or are waiting for them at a store.<\/p>\n<p>The appeal of skipping the store is powerful, especially among younger consumers. A recent study found 66% of Millennials now shop online weekly for groceries. At least once a month, 69% of <a href=\"https:\/\/www.rangeme.com\/blog\/what-millennials-want-from-consumer-goods\/\">Millennials<\/a> purchase health and wellness products, and 25% purchase pet food online weekly.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_3');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_3');\" ><sup id=\"footnote_plugin_tooltip_3715_1_3\" class=\"footnote_plugin_tooltip_text\">3<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_3\" class=\"footnote_tooltip\">Loria, Keith. Most millennials grocery shop online. Here\u2019s how to get them into stores. Food Dive. February 24, 2017.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_3').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_3', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script><\/p>\n<p>Admittedly, brick and mortar stores currently dominate grocery sales. Shoppers often savor the sumptuous, multisensory experience of physical stores and they may relish having control and making careful food selections. However, online grocery still matters right now \u2014 76% of all shopping trips begin online, and 50% of CPG category growth will be online in 2018.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_4');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_4');\" ><sup id=\"footnote_plugin_tooltip_3715_1_4\" class=\"footnote_plugin_tooltip_text\">4<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_4\" class=\"footnote_tooltip\">Online Grocery on the Rise as Consumers Seek Value: IRI Study. Winsight Grocery Business. January 17, 2018.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_4').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_4', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script><\/p>\n<p><strong>Retailers deliver the goods as e-grocery grows<\/strong><br \/>\nIn response, retailers are making their e-grocery strategy more robust to give consumers more omnichannel \u2013 or <a href=\"https:\/\/www.rangeme.com\/blog\/retail-gets-phygital-part-1\/\">phygital<\/a> \u2013 options. Their click-and-collect programs allow consumers to buy online and pick up in store (BOPIS) and their physical stores make returns easier.<\/p>\n<p>Yet omnichannel excellence is challenging and expensive. It\u2019s complex for retailers to establish fast, reliable logistics networks to promptly deliver products to consumers\u2019 doorsteps. Retailers also struggle with changing consumer behavior to encourage them to keep coming back to their e-commerce sites to frequently buy an entire basket of groceries rather than a few items at random intervals.<\/p>\n<p style=\"text-align: center;\"><strong>E-grocery success entails changing consumers\u2019 entrenched habits to entice them to shop online (and often)<\/strong><\/p>\n<p>As e-grocery matures and consumer habits change, experts say center store CPG categories, like cereal, granola bars and soda, will move online faster than perimeter categories, like fresh produce, dairy and meats, which require refrigeration and special handling along the <a href=\"https:\/\/www.rangeme.com\/blog\/infographic-supply-chain-reinvention-2007-vs-2017\/\">supply chain<\/a>.<\/p>\n<p>To win (or at least survive) in e-grocery, here\u2019s how leading retailers are adapting to the online grocery shopping trend:<\/p>\n<ul>\n<li>Amazon is making grocery loyalty more lucrative. To incentivize shoppers to add grocery items to their online shopping carts, Amazon will give Prime members 10% off already discounted products. In addition, Prime members will receive free delivery of Whole Foods products in certain locations and 5% cash back when they use Amazon\u2019s Visa at Whole Foods stores, plus exclusive member deals.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_5');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_5');\" ><sup id=\"footnote_plugin_tooltip_3715_1_5\" class=\"footnote_plugin_tooltip_text\">5<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_5\" class=\"footnote_tooltip\">Hirsch, Lauren. Amazon plans more Prime perks at Whole Foods, and it will change the industry. CNBC. May 1, 2018.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_5').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_5', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script><\/li>\n<li>Walmart is using its physical presence of more than 4,700 stores as an e-grocery differentiator that allows easy in-store pickups.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_6');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_6');\" ><sup id=\"footnote_plugin_tooltip_3715_1_6\" class=\"footnote_plugin_tooltip_text\">6<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_6\" class=\"footnote_tooltip\"> Walmart Gives Itself A Website Makeover As Amazon Battle Steps Up. Investors Business Daily. April 17, 2018.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_6').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_6', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script>The company\u2019s recently refreshed website emphasizes the free grocery pickup service and Easy Reorder option to streamline the grocery shopping experience. Walmart also plans to expand its grocery delivery business to 800 stores by the end of the year.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_7');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_7');\" ><sup id=\"footnote_plugin_tooltip_3715_1_7\" class=\"footnote_plugin_tooltip_text\">7<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_7\" class=\"footnote_tooltip\"> Hirsch, Lauren. Amazon plans more Prime perks at Whole Foods, and it will change the industry. CNBC. May 1, 2018<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_7').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_7', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script> Walmart also acquired same-day delivery service Parcel.<\/li>\n<li>Target dropped the prices of its grocery products in time for Thanksgiving last year and invested in delivery company Shipt to give consumers the benefit of same-day delivery.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_8');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_8');\" ><sup id=\"footnote_plugin_tooltip_3715_1_8\" class=\"footnote_plugin_tooltip_text\">8<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_8\" class=\"footnote_tooltip\"> Naidu, Richa, Gayathree Ganesan. Target slashes prices on thousands of items, shares falter. Reuters. September 8, 2017.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_8').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_8', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script><\/li>\n<li>Kroger has expanded its click-and-collect program. For the added convenience of home delivery, Kroger partners with delivery experts like Uber, Shipt and Instacart.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_9');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_9');\" ><sup id=\"footnote_plugin_tooltip_3715_1_9\" class=\"footnote_plugin_tooltip_text\">9<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_9\" class=\"footnote_tooltip\"> Chen, Cathaleen. Take That, Amazon and Walmart! Kroger Has Been Honing Online Grocery All Along. The Street. November 30, 2017.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_9').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_9', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script><\/li>\n<li>Albertsons, Safeway and Costco also recently partnered with Instacart to provide home delivery grocery services.<span class=\"footnote_referrer\"><a role=\"button\" tabindex=\"0\" onclick=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_10');\" onkeypress=\"footnote_moveToReference_3715_1('footnote_plugin_reference_3715_1_10');\" ><sup id=\"footnote_plugin_tooltip_3715_1_10\" class=\"footnote_plugin_tooltip_text\">10<\/sup><\/a><span id=\"footnote_plugin_tooltip_text_3715_1_10\" class=\"footnote_tooltip\">Amazon\u2019s Acquisition of Whole Foods and What It Means for the Grocery Industry. Lexology. April 24, 2018.<\/span><\/span><script type=\"text\/javascript\"> jQuery('#footnote_plugin_tooltip_3715_1_10').tooltip({ tip: '#footnote_plugin_tooltip_text_3715_1_10', tipClass: 'footnote_tooltip', effect: 'fade', predelay: 0, fadeInSpeed: 200, delay: 400, fadeOutSpeed: 200, position: 'top right', relative: true, offset: [10, 10], });<\/script><\/li>\n<\/ul>\n<p><strong>Suppliers can give retailers an e-grocery advantage<\/strong><br \/>\nFor a grocery assortment that stands out online, retailers need to consider how their retail partners, including CPG suppliers, can give them an edge.<\/p>\n<p>Suppliers with the greatest opportunity for success in the short term are CPG companies selling products in center store categories, as their shelf stable products avoid the need for refrigeration. In addition, in-demand suppliers are those whose products align with the hottest trends in grocery retail, including: <a href=\"https:\/\/www.rangeme.com\/blog\/infographic-the-explosive-growth-of-natural-and-organic-timeline\/\">natural and organic<\/a>, <a href=\"https:\/\/www.rangeme.com\/blog\/local-foods-growth-in-retail\/\">local<\/a>, <a href=\"https:\/\/www.rangeme.com\/blog\/artisan-sales-soar-as-consumers-invest-in-quality\/\">artisan<\/a>, <a href=\"https:\/\/www.rangeme.com\/blog\/6-culinary-trends-spicing-up-grocery\/\">culinary<\/a> and <a href=\"https:\/\/www.rangeme.com\/blog\/hungry-for-health-wellness-5-major-food-trends\/\">health and wellness<\/a>.<\/p>\n<p>To keep up with consumers\u2019 appetite for ease and convenience, retailers\u2019 e-grocery strategies will give consumers a greater variety of service options, including the freedom to order groceries from wherever they are. Retailers that effectively deliver what online grocery shoppers want can gain a competitive advantage, and boost sales and loyalty in the exciting e-grocery arena.<\/p>\n<div class=\"speaker-mute footnotes_reference_container\"> <div class=\"footnote_container_prepare\"><p><span role=\"button\" tabindex=\"0\" class=\"footnote_reference_container_label pointer\" onclick=\"footnote_expand_collapse_reference_container_3715_1();\">&#x202F;<\/span><span role=\"button\" tabindex=\"0\" class=\"footnote_reference_container_collapse_button\" style=\"\" onclick=\"footnote_expand_collapse_reference_container_3715_1();\">[<a id=\"footnote_reference_container_collapse_button_3715_1\">+<\/a>]<\/span><\/p><\/div> <div id=\"footnote_references_container_3715_1\" style=\"display: none;\"><table class=\"footnotes_table footnote-reference-container\"><caption class=\"accessibility\">References<\/caption> <tbody> \r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_1');\"><a id=\"footnote_plugin_reference_3715_1_1\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>1<\/a><\/th> <td class=\"footnote_plugin_text\">Anderson, George. FMI says switch to online grocery sales going faster than expected. RetailWire. January 30, 2018.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_2');\"><a id=\"footnote_plugin_reference_3715_1_2\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>2<\/a><\/th> <td class=\"footnote_plugin_text\">Daniels, Jeff. Online grocery sales set to surge, grabbing 20 percent of market by 2025. CNBC. January 30, 2017.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_3');\"><a id=\"footnote_plugin_reference_3715_1_3\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>3<\/a><\/th> <td class=\"footnote_plugin_text\">Loria, Keith. Most millennials grocery shop online. Here\u2019s how to get them into stores. Food Dive. February 24, 2017.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_4');\"><a id=\"footnote_plugin_reference_3715_1_4\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>4<\/a><\/th> <td class=\"footnote_plugin_text\">Online Grocery on the Rise as Consumers Seek Value: IRI Study. Winsight Grocery Business. January 17, 2018.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_5');\"><a id=\"footnote_plugin_reference_3715_1_5\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>5<\/a><\/th> <td class=\"footnote_plugin_text\">Hirsch, Lauren. Amazon plans more Prime perks at Whole Foods, and it will change the industry. CNBC. May 1, 2018.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_6');\"><a id=\"footnote_plugin_reference_3715_1_6\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>6<\/a><\/th> <td class=\"footnote_plugin_text\"> Walmart Gives Itself A Website Makeover As Amazon Battle Steps Up. Investors Business Daily. April 17, 2018.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_7');\"><a id=\"footnote_plugin_reference_3715_1_7\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>7<\/a><\/th> <td class=\"footnote_plugin_text\"> Hirsch, Lauren. Amazon plans more Prime perks at Whole Foods, and it will change the industry. CNBC. May 1, 2018<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_8');\"><a id=\"footnote_plugin_reference_3715_1_8\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>8<\/a><\/th> <td class=\"footnote_plugin_text\"> Naidu, Richa, Gayathree Ganesan. Target slashes prices on thousands of items, shares falter. Reuters. September 8, 2017.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_9');\"><a id=\"footnote_plugin_reference_3715_1_9\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>9<\/a><\/th> <td class=\"footnote_plugin_text\"> Chen, Cathaleen. Take That, Amazon and Walmart! Kroger Has Been Honing Online Grocery All Along. The Street. November 30, 2017.<\/td><\/tr>\r\n\r\n<tr class=\"footnotes_plugin_reference_row\"> <th scope=\"row\" class=\"footnote_plugin_index_combi pointer\"  onclick=\"footnote_moveToAnchor_3715_1('footnote_plugin_tooltip_3715_1_10');\"><a id=\"footnote_plugin_reference_3715_1_10\" class=\"footnote_backlink\"><span class=\"footnote_index_arrow\">&#8593;<\/span>10<\/a><\/th> <td class=\"footnote_plugin_text\">Amazon\u2019s Acquisition of Whole Foods and What It Means for the Grocery Industry. Lexology. 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