What is Online Grocery? Online grocery can be either a brick-and-mortar store or an e-commerce service. Typically, the service charges a delivery fee for its services. However, there are some advantages and disadvantages to online grocery ordering. Let’s take a closer look. This article will discuss the growing trend and what it means for the industry. It will also examine how the pandemic will affect the industry.
Growing trend
The growing trend of online grocery shopping is a trend that has several advantages. Purchasing food online is convenient and it also saves on time. It can save on transportation costs as non-perishable items can be stored outside of the city. However, the delivery cost for groceries is higher than other online products, so an internet grocer must invest in a reliable supply chain system and specialized delivery vehicles. Several advantages of online grocery shopping are listed below.
Almost one third of internet users have bought grocery items online in the past month, a number that is expected to continue to grow. The rate of growth varies according to region and primary household shopper. The United States and North America are among the countries where online grocery shopping is on the rise. Among the top online grocery destinations, Walmart, Amazon, and Costco have the highest growth rates. Online grocery shopping is becoming the norm, transforming grocery platforms.
Challenges
The biggest challenge for online grocery stores is generating customer loyalty. Lack of customer loyalty can be disastrous for your business. Most people shop at places they have an emotional attachment to. Customers may not choose to shop at an online grocery store if they do not feel emotionally connected to the store. Hence, generating customer loyalty requires a dedicated marketing campaign. To make your customers stay loyal to your store, use creative marketing methods. To keep your customers engaged and interested, offer great discounts and offers.
While there are numerous benefits of online shopping, it is also important to keep in mind the challenges that you may face. A common obstacle is time required to fill a grocery basket. A first-time shopper spends an average of one minute on choosing and researching every single product. So if you buy 50 items, it can take you half an hour to complete your shopping. Fortunately, a company like Coles has embraced this challenge by integrating its customers’ online profile with their in-store purchasing habits. Customers can import their recent purchases to their online profile, reducing the process to 20 minutes.
Business model
An online grocery store can be simple and easy to use if it is developed on a subscription model. Customers simply need to add items to their shopping carts and receive them automatically every month. This will create a recurring revenue stream for the business. A subscription model can also increase customer loyalty and generate word-of-mouth marketing. Regardless of how your online grocery store is structured, these steps will help you get started and grow your business.
One successful business model involves tying up with multiple sellers to make the most money. This is also known as a zero-inventory model. With this business model, the seller manages the delivery process using third-party providers. They do not need to worry about stocking and maintenance of inventory. This model allows you to focus on the quality of goods and the consistency of the services. Another advantage of a multi-vendor business model is that you don’t have to invest a lot of money compared to a single vendor.
Impact of pandemic on industry
The COVID-19 coronavirus that swept across the globe in 2020 caused a shift in consumer behaviour, changing societies and reducing sales for brick-and-mortar stores. Governments reacted by imposing social distancing and lockdown measures in order to limit the spread of the virus. These measures resulted in drastic shifts in shopper behaviour, with panic buying driving growth in the online grocery industry. In a recent Adobe Digital Economy Index report, researchers examined the pandemic’s effects, including the shifts that have occurred since the lockdowns began in March 2020.
The rapid growth of e-commerce is having profound effects on the online grocery industry. Several players, including Uber-owned Cornershop and DoorDash, are building marketplaces that bring shoppers and merchants together. Further, investments are flowing into next-day and instant delivery, with multiple players testing the concept. Gopuff, DoorDash, and JOKR are among the companies testing this new mode of delivery. Meanwhile, warehouse-based grocery delivery is also gaining popularity.
