Back in 1950 and up until now, we’ve counted four different trends of retail grocery. Started with focus on ‘brand’ in the 1950s, then on ‘category’ in the 1970s, and on customers around late 1990s, and lastly (or latest), the ‘customer control’ that started in 2010 introducing “click and bricks”- something everyone calls the “Amazon factor”.
The newest shift positively fueled the strengths of brands and retailers as they strive to compete with the newest standard in technology and economic volatility. With the new era, only brands that are strong and can easily blend with changes will survive.
To survive, grocery brands must master and control the newest emerging trends that will reshape the industry for the next decade(s).
Online Grocery Is Here To Stay
There’s a global war going on between the online and offline retailers in the $5 trillion grocery market. “Online grocery market is expected to double up from 2017’s $150 billion to $334 billion by 2022”, as reported by a Forester Research.
For example, at the moment, only about 28% of consumers in South Korea purchase their grocery online unlike 25% in metro China. As for the UK, only about 16% purchases lobsters online.
In the United States, integration of online grocery shopping has been discouraging. Although the general statistics of online shopping in the country has lagged, with only 4% of the total population purchasing online, food marketing institute foresees the U.S online grocery market dominating up to 20% of grocery purchases in the U.S and over $100 billion in sales by 2025.
The study further highlighted the online purchasing power of grocery among age groups in the U.S with Millenials taking over 61%, Generation X taking over 55%, while boomers took 39%. The statistics imply that customers are willing to purchase their grocery online but are retailers ready?
Making it big as an online grocery retailer requires a foundational change to mode of service, from simply creating and distributing groceries, to delivering the best user experience. This foundational change also ranges from positively utilizing customer’s data to keeping their interest at bay.
Consumers Love For Convenience Shopping Keeps Increasing
Today, customers want a swift service experience: Amazon knows this fact and uses it to its advantage. And that’s the secret of its continued success in the sales space.
CEO Amazon, Jeff Bezos says,” convenience is the biggest Competitive distinction. Customers are loyal to service until someone else gives them a better service. And that’s our motivation”
Most brick and mortar grocery retailers maintain customer’s insistence on convenience by creating an excellent in-store experience. Now, retailers use customer’s data to team up with brands and logically proffer a seamless shopping experience for customers.
Grocery retailers team up with CPG brands to create a compatible grouping that allows similar products to be merged together in one single group.
For example, in mercato.com, “what’s for lunch” will feature products from drinks to spices to protein merged together in a single group.
This style of merging products will not only quicken the customer’s product search but also improve their buying decision.
Furthermore, an efficient marketing strategy will attract customers to visit an online shop and have them come back again.
Size Of Grocery Stores Are Shrinking
According to the last year statistics, “Physical stores are decreasing in size. There has been a 15% reduction in average sales area since 2010. Confusedly, future prediction argues that we should expect only one third or half of the present size.
Also, the e-commerce grocery store and physical in-store will become a different multichannel experience.
Going numbers, a future model accounted for an average store having only 5,000 items( as opposed to the present stores averaging over 45,000 items) where basic products will be picked and ready for delivery. It’s impressive for retailers who plan to outshine its competitors to watch out for this trend and work on having larger footprints stores.
Conclusively, the fact is, the change is around the corner, perhaps stricter than ever. A grocery retailer who knows this new trend, adapt to it and creates an updated solution to customer’s needs will emerge successful. And they’ll be better positioned and highly placed when it comes to serving customers and providing values.