This week, IdeaXchange Xpert Neil Stern offered his take on a very hot topic in the grocery space in a post titled “Online shopping barriers slowly dissolve.” Neil pointed to Waitrose's home barcode scanner, Instacart's aggressive growth, Walmart's pick-up service and the East Coast expansion of AmazonFresh as examples of how e-grocery is moving into the mainstream.
Several of our readers responded with some ideas of their own. Let’s look at a couple of those ideas in more depth.
Commenter PJ Stafford of the Honest Green Division of UNFI pointed out that Instacart marks up the prices on groceries, so the retailer actually charges more than $3.99 for a delivery.
While that may be the case, a recent report from BI Intelligence shows that may not matter much to consumers. The E-Commerce Grocery Report found that 25% of Millennials would be willing to pay a premium for same-day delivery. One fifth of urban consumers said the same.
In another comment to Neil’s post, Brian Numainville of Retail Feedback Group suggested that there are other competitors that retailers need to watch out for:
Finally, other models like NatureBox.com and Plated or Blue Apron are also akin to "category killers" and are filtering off sales that formerly came from others.
Similarly, Search Engine Journal recently delved into a few examples of online grocery and related ventures in Europe. Though the author’s analysis is a bit technical, the basic premise is that based on how consumers search for food delivery, e-grocery retailers are likely competing with many types of online businesses, from those that provide meal preparation kits to aggregators of restaurant delivery services.
Brick-and-mortar supermarkets have dealt with their fair share of non-traditional competitors in recent years so it’s no surprise that online grocers face similar challenges.
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