PASADENA, Calif. -- The development of online grocery shopping will invariably be linked with the traditional in-store experience, according to panelists last week at a workshop here at the SN/Executive Technology Summit on e-commerce.
"Online shopping complements and enhances the store experience, but it will never replace it completely," Lisa Kent, president of Netgrocer.com, North Brunswick, N.J., said.
"A significant percentage of Netgrocer shoppers say they like the convenience of shopping online, but they also say they want to go to the store to purchase perishables and to have the opportunity to share the community experience."
Netgrocer offers primarily non-perishables online, although Kent said the Internet company also sells some temperature-controlled non-perishable merchandise.
Jill Frankle, director of e-commerce, retail, for Gomez Advisors, Waltham, Mass., said most consumers are buying online the products they regularly purchase in a store environment, "so basically, they're transferring their offline behavior to the online world, which is good news for offline grocers."
She also said research suggests the online experience "must be seamlessly tied to the offline experience in terms of promotions and marketing."
Dean Brown, director of business development for Tesco.com, the e-commerce division of U.K.-based Tesco, offered a similar opinion. "People are interested in shopping both online and offline, depending on what suits them," he told the workshop audience.
As a result, Brown said, retailers should be giving online customers exactly what the customers want, "rather than finding more cunning ways to sell them what they don't want. The focus should be on the largest possible market, with an offer that completely replaces the need to go shopping," he explained.
For Tesco.com, that means offering a full range of 25,000 to 30,000 stockkeeping units and a full range of coupons, loyalty-card specials and other offerings that are available to in-store shoppers, Brown said.
Marc van Gelder, president and chief executive officer of Peapod, the Skokie, Ill.-based home delivery arm of Ahold USA, Chantilly, Va., said his company offers 10,000 selected SKUs, "which allows us to cater to our customers' needs, although we find they still go to the store at least once a month instead of once a week.
"And by integrating Peapod's efforts with those of Ahold's food service companies, the parent company is able to regain part of the share-of-stomach the conventional grocery stores have been losing," van Gelder said.
Richard A. Brindle, vice president, e-sales, for Nabisco, Parsippany, N.J., said his company works with all retailers, "regardless of their marketing proposition. A lot of manufacturers tend to evaluate a model, but our point of view is, we want everyone to succeed, so we sell product to all retailers.
"If we avoided companies just because we didn't believe in their business model, that would create a self-fulfilling prophecy for those companies to fail.
"But Nabisco, like other manufacturers, is struggling to find out what the best practices for these companies are, and we believe the approach that succeeds is active collaboration -- understanding the unique needs of retailers of all sorts and then figuring out how we can combine our strengths with theirs so everyone wins."
Kent said working with companies that take an active collaboration approach has enabled Netgrocer "to double, triple or quadruple its sales with those manufacturers, because it helps us build each other's business."