The e-grocery industry is rapidly becoming one of the leading e-commerce markets internationally. As an accessible and affordable system that allows consumers to order and deliver groceries right to their door, users in the age of convenience are increasingly turning to e-grocery. While traditional physical stores still reign supreme, the balance is certainly starting to turn.
Revenue from e-retail pursuits has grown every year over the past decade, now accounting for over $100 billion in the U.S. alone. E-grocery represents a rapidly expanding segment of these total sales, accounting for 11.67% of this figure in 2021. By 2027, Statista predicts this figure will rise to over 21% of total revenues.
As a complex and evolving ecosystem, e-grocery brands have learned to minimize overhead expenditure while using tech and management tools to maximize revenue and customer satisfaction. In this article, we’ll dive into everything you need to know about online food shopping, touching upon what it is, its history, its benefits, and current trends in this space.
Introduction to E-Grocery
Online grocery shopping is a service offered by grocery stores that provides greater convenience for their consumers. Customers who don’t have time to or simply don’t want to go to a physical brick-and-mortar store can use an e-grocery service to get their groceries delivered to their door.
The digital grocery system saves customers time while also offering them a great deal of flexibility in how they approach grocery shopping. Studies by DriveResearch reveal that the average shopper goes to a grocery store eight times per month. When adding all of the time it takes to go to the store, pick out groceries, check out, and return home, these eight times can represent a considerable time commitment.
For grocery stores, digital buying and delivery provides a method of securing new customers, increasing customer satisfaction, and providing a premier service to current clients.
How Does E-Grocery Work?
The ingenuity of e-grocery systems is that it directly recreates the experience that a customer can expect in-store but on a mobile or web device. Instead of having to pursue through the aisles, customers can simply select the items they want, add them to the cart, and wait for a delivery driver to arrive.
Customers are also able to select a specific date and time that they want their groceries delivered, with additional flexibility for curb-side pickup allowing shoppers to have complete control over the process of buying groceries.
From the customers’ perspective, there are four steps to online grocery shopping platforms:
- Create an account on the e-grocery platform of your choice, shop as a guest, or use your Apple, Google, or other supported accounts.
- Select products from the store to add to your digital cart.
- Checkout by adding a payment option.
- Choose your delivery address, select a specific delivery time window, wait for the supermarket delivery to arrive at your door or for curb-side pickup.
One area of e-grocery systems that is commonly overlooked but also bears mentioning is the fact that it provides a useful alternative for the elderly and those with physical or visual disabilities. For those that cannot easily maneuver in a grocery store or find this challenging, shopping online can be a fantastic and accessible alternative.
As a core part of web and app development concerns, especially thanks to the Web Content Accessibility Guidelines, online food applications are a vital tool for differently-abled people. The access that voice-search systems add ensure that browsing through grocery items is always as easy as possible for the user.
E-grocery platforms are accessible to absolutely anyone that needs them, whether that be for time, disability, preference, or another tertiary motive.
What Are the Benefits of E-Grocery?
Online grocery platforms have seen such remarkable traction due to the expansive range of benefits that they offer to customers. Especially during the 2020 pandemic, where many people had restricted movement, the ability to order groceries online was a fantastic opportunity.
Data published by Forbes demonstrated that in 2019, 81% of U.S consumers had never purchased groceries through an online platform. Yet, by the end of 2020, this figure had almost completely reversed, with 79% of U.S. consumers ordering their groceries online at least once a month.
The pandemic was a testing period for many consumers, allowing them to dabble in online delivery even if they were not interested in previous years. Once they attempted web grocery shopping, they quickly encountered its many benefits:
- Saving Time - As previously mentioned, digital grocery shopping saves time as users don’t have to travel to the supermarket or queue. Shoppers can also save preferred items and baskets to save even more time during future purchases.
- Effective Financial Savings - Coupon savings in stores can often be difficult to understand or fairly hidden within supermarkets. On an online platform, all available savings opportunities are more clearly laid out, allowing customers to find deals that they wouldn’t have otherwise noticed. Over time, small supermarket savings can make a considerable difference to customers while also reducing transportation costs without the need to travel to the supermarket.
- Contactless Shopping - This benefit was most extremely demonstrated in the COVID-19 pandemic, where e-grocery delivery allowed customers to shop without fear of contamination. However, even in periods of relative normality, some shoppers may prefer the experience of not having to be around others.
- Increased Flexibility - Many grocery delivery applications allow customers to choose when their delivery arrives. For those that don’t work from home, this can allow consumers to time their deliveries with the exact hours that they’ll be at home. Alternatively, customers can choose curb-side pickup from their preferred store if they’d still like to go to the supermarket.
Although these are not an exhaustive list, they represent a few of the fundamental benefits that e-grocery consumers can expect to obtain. Many of these benefits lead to a more refined customer experience which can help to boost customer lifetime value and loyalty for supermarket brands.
What Are the Challenges of E-Grocery
Although there are a number of benefits of e-grocery, the industry also suffers from a range of challenges for both brands and customers. However, despite the prevalence of these issues, many modern grocery brands are encountering creative solutions.
Here are the most pressing challenges — and their solutions — in the e-grocery industry:
- Competition for Customer Loyalty: As more e-grocery brands launch into this digital space, there is more competition for customer loyalty. Brands are countering this issue by turning to effective loyalty modules, discounts, and schemes that ensure customers continue to choose their supermarket services every time they shop.
- Comprehensive Technological Access: While all supermarket stores will have an internal stock management system, they may not have the capabilities to add even more factors to this technological structure. However, grocery brands are able to make use to third-party integrations, AI-forward services, and other bridging technologies to take their current systems and allow them to support live interaction from online customers.
- Achieving Effective Delivery: Many grocery brands suffer when expanding into the digital market because they are unable to find an effective delivery solution for their business. Even if they can convert their shoppers to online customers, they still need to find a delivery system that distributes the products rapidly and efficiently. However, e-grocery brands can partner with platforms like Wave Grocery that help them to create streamlined and comprehensive delivery systems to keep business running smoothly.
While only scratching the surface of the potential challenges of e-grocery, these examples demonstrate the extent to which the sector has encountered effective solutions to each problem that has arisen.
How Has the E-Grocery Industry Helped Brick-and-Mortar Stores Thrive?
Across the pandemic, supermarkets’ ability to adapt and rise to meet the changing needs of their customers was a determining factor of success. Those that couldn’t adapt were unable to sever their customer base, leading to reduced hold within their local market.
Alternatively, brands like KRITIKOS Supermarket managed to quickly scale to serve 17 prefectures and 50+ cities by moving into the online market. Working alongside Wave Grocery, they established an online grocery presence, increasingly e-grocery fulfillment by 7x, and maintained a 4.7-star rating on app stores.
The above example demonstrates the power of opportunity, with the e-grocery world providing a perfect springboard for success – when done correctly. For both consumers and supermarket companies, the availability of virtual grocery shopping platforms is a major advantage.
Emerging E-Grocery Trends
The most consistent e-grocery trend that the market is experiencing is its continual growth. According to U.S Census Bureau data, the Department of Commerce has signaled that e-retail sales are only going to continue to rise over the coming years. Since the pandemic, there has been a sharp increase in the use and availability of online food delivery services.
Beyond this expansion, another main trend that the industry is experiencing is the widespread incorporation of artificial intelligence (AI) technologies. AI can integrate into almost every area of the supermarket structure, helping with everything from shelving management to stock ordering and trend prediction.
More specifically to e-grocery, AI represents a powerful suite of data analytics tools. By using AI to chart, predict, and accommodate changes in consumer habits, brands are able to continually stay ahead of trends and offer the right products to the right customers. For the customer, the level of personalization that AI offers will improve the shopping experience and help boost satisfaction.
Located in a digital landscape, AI and personalization tools are perfectly positioned to help with the complicated network of recommendations and product suggestions needed in a supermarket platform. By incorporating these technologies into e-grocery mobile apps and platforms, businesses can directly accommodate customers, helping them to find products they love.
In other fields, personalization has shown incredible potential to boost sales and drive engagement. As online grocery platforms continue to focus on personalization, with the help of AI, they will access these benefits and further begin to increase revenue across the board.
The e-grocery industry is a bustling hub of instant commerce, time-saving efficiency, and data-driven product recommendations. As an expanding field, the world of online food shopping is quickly gaining both media and customer attention. Considering the vast array of customer benefits that web grocery apps offer, this is hardly a surprising trend.
For supermarket businesses that are looking to expand into the digital landscape of e-groceries, Wave Grocery offers a bespoke method of turning a physical storefront into a digital business in less than 30 days. Businesses will be able to use the advanced product recommendation, machine learning, and multi-platform development features that Wave Grocery offers to make a platform that their customers love.
The world of online groceries is experiencing incredible growth. By partnering with Wave Grocery, your business can seize its segment of the market and expand into this bustling digital landscape. Reach out to our team today to hear more.