What You Need to Know About Grocery E-commerce for 2018

April 09, 2018

Why should you be concerned about online grocery shopping?

Currently, grocery ecommerce commands about 2% to 4.3% share of the $641 Billion U.S. grocery market. In 7 years, grocery ecommerce is projected to be a $100 Billion industry that takes up 20% of the overall grocery market.

Grocers who don’t get onboard with online grocery shopping are going to get left behind. We will examine who is buying groceries online, examine ecommerce frequency, what’s holding shoppers back from online shopping and look at what customers are actually buying online.

Who’s Shopping Online?

Consumers like shopping online because it saves time and money. Convenience is the #1 reason shoppers like to buy groceries online. Consumers also say online shopping makes it easier to find lower-price products.

46% of households report shopping for groceries online. In as few as 5 years, 7 in 10 consumers will buy food and beverages online. According to Nielsen’s The Digitally Engaged Food Shopper, released in January of 2018, here’s how prolific grocery ecommerce has been for the past 3 months per generation:

39% Greatest Gen

44% Boomers

55% Gen X

61% Millennials

1 in 3 Millennials say they shop for groceries online more than they were at this time last year and 57% say they will shop online more in the next year.

And online grocery shopping isn’t a one-time experience for most consumers. 85% of those who shopped for groceries online did so more than once, with 64% ordering online at least once a month.

62% of shoppers say that they want alternatives to traditional, in-store grocery shopping. 36% plan to order groceries online in 2018, which is up from the 22% who shopped online for groceries in 2017.

Where Customers Shop Online

If you don’t offer ecommerce, your customers will have to look elsewhere. 51% of those who didn’t shop with their local grocer said it was because their local grocer didn’t offer it.

The top places shoppers go to buy groceries online are:

42% local grocer

34% Amazon

32% Walmart

12% Instacart

8% Peapod

6% FreshDirect

Products Purchased

The average customer spends $148 per online grocery transaction. Most of those transactions included produce, meat/seafood and deli. Almost 50% of those transactions also included bakery items.

Shoppers aren’t buying only fresh items. Packaged foods like beverages and snacks constitute most of Amazon’s U.S. online grocery sales

A study released during last year detailed which products customers are likely to buy online:

74% toothpaste

72% feminine hygiene

70% OTC medication

50% chocolate

48% alcohol

35% bread

25% milk

24% ice cream

23% tomatoes

22% chicken breasts

Barriers to Online Shopping

Not everyone is on board with buying groceries online. The #1 barrier to online grocery shopping is the desire to see the food in person.

78% of consumers didn’t shop for online groceries in 2017 because:

41% enjoy weekly trip to the store

36% didn’t want to pay extra

33% don’t trust someone else picking up their food

25% local grocer didn’t offer it

11% didn’t find the time to do it

Customers’ primary concerns for shopping online include:

69% quality concerns

61% not seeing/touching before buying

58% not taking advantage of sales/promotions

51% minimum purchase requirements

50% need groceries immediately

40% ordering unavailable items

39% accuracy of orders

19% how long it takes to shop for groceries

13% lack of human assistance

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