If you believe in the “There’s an app for that” dictum and have used your phone to order a carton of orange juice or a dozen eggs at least once in the last year, then you contributed to the $21 billion that online grocery sales netted in 2016. And, if you intend to replace supermarket aisles for swipes and clicks, you’d contribute to the market that’s set to touch $100 billion by 2025.
The internet today performs many roles — ranging from serving as a librarian, teacher, banker and even a grocer. A Nielsen report released earlier this year pointed out that roughly 3 in 5 grocery shoppers have used couponing on their phones before entering stores. Others are avoiding stores altogether.
Cheap AND convenient? Just take my money!
Shopping at the grocery store can be tedious, and those who want to shop for healthy foods often experience sticker shock. So how do consumers prioritize shopping online? On the basis of three factors: Convenience, cost and customer service.
Does online shopping help consumers score better deals for the food they buy? The answer appears to be ‘yes’ given the litany of new online grocery shopping sites like Peapod, Netgrocer, and Alice. However, more the biggest online grocery retailers like Amazon and Walmart still dominate the online conversation.
— NZ Muse (@eemusings) July 10, 2017
Walmart is about to kill the game AGAIN! 'Walmart to GO' delivering groceries you buy online (cheaper than everybody else's) to your door.
— NiNi (@MrsVal_2) April 25, 2011
You can buy cereal online from amazon for cheaper than the grocery store? My life has changed.
— Ted Fu (@tedfu) February 6, 2013
Who’s leading the brand race?
Online shopping is winning the battle against grocery stores on most counts thanks to better prices, convenience, and customer service. But who is bringing the best of all three to the user?
Three brands emerged on top in the online grocery conversation: Amazon, Walmart and Peapod. While Peapod is discussed most when it comes to convenience, larger retailers like Amazon and Walmart are associated with better prices.
We can see how different services are preferred by consumers for different purposes — While Amazon wins over the consumer with competitive prices and convenience, its customer service is not on par with services like Peapod and Walmart. But for bargain-hunters, it’s all about scoring the best deals and shopping online can oftentimes yield better prices than shopping in-store.
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Who is The Online Grocery Shopper?
We have identified the brands winning and losing the online shopping race, and established that an online shopper looks for value, convenience and care. But what more can we learn about shoppers themselves?
A demographic analysis showed that the user profile varies by brand, but consumers over 35 seem to prefer Peapod and Amazon whereas Walmart is popular among consumers between 25 and 34 and its following skews male. Amazon is more evenly split between men and women.
Social media traction on the topic indicates that there is no better time to be in the online grocery business, and we don’t need further proof than Amazon-Whole Foods Deal. But once again, the devil lies in the details — do consumers value price more than convenience? Will that trend change? What compromises will they be willing to make? Thankfully, we can readily find answers to these questions in social media conversations.
For more grocery store specific insights, download our CPG food trends report today.