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“I’ve always described food as the last great frontier in e-commerce. There’s no other $800-billion-dollar industry that e-commerce hasn’t touched yet.”
— Chad Arnold, president and CEO, Door to Door Organics
Out of the Box
Online retailers admit they also have work to do. For all the convenience and value to be found in web-based stores, humans remain tactile creatures that like to touch, see and smell. It’s an advantage that gives supermarkets the edge as the top shopping destination.
“In many respects consumers want certain things from a store. They have the face-to-face interaction,” said Zucker of Vitacost. “The other thing you get is immediacy. You get it now.”
“No one is going to go cold turkey and quit grocery shopping altogether,” agreed Mulpuru of Forrester. “I think that traditional grocery is still convenient and is hard to beat.”
While the “gotta-have-it-now” mentality entirely benefits brick-and-mortar operators, it hasn’t stopped online purveyors from attempting to find ways around that hurdle, or at least to neutralize its power.
Instead of developing gargantuan plans for same-day delivery, Vitacost is seeking to redefine the problem itself. Its own research reveals a new way to approach consumers.
“The barrier to shopping more for nonperishable items on the web is around people’s ability to plan,” said Zucker. “Not everyone either knows how to do that, or is consistent about it.”
For a site like Vitacost, offering an array of shelf-stable foods, dietary supplements and HBC items, someone who has a better handle on what they need in their pantry on a consistent basis — soups, pasta, rice or cereal, for instance — is a customer that could benefit greatly from ordering online and getting home delivery.
“On a value perspective, if you need oats or beans every week, you don’t need to pay supermarket prices,” noted Zucker.
The concept of free shipping is a double-edged sword for online customers. While they like the idea, they can balk at the spending minimums set by the retailer in order to qualify.
“Here’s the conundrum. Everybody thinks the consumer wants fast, same-day delivery. And they do want that, but they don’t want to pay for it,” said Mulpuru.
Vitacost can typically deliver within four to seven days, and offers free shipping on orders over $49; the deal is the same at Abe’s Market. At Door to Door Organics, shipping is free for the weekly boxes of produce and any additional items ordered from the other categories available on the website.
“The world is moving towards a place where everybody expects free delivery,” said Arnold, Door to Door’s CEO, adding that building “smart density” and operational efficiencies allow it to take shipping costs out of the equation. Some of the $2 million recently invested will go toward strengthening the supply chain.
“Delivery charges are not something people want to pay for,” he said. Door to Door uses waxed boxes to ship its mostly perishable foods. Box size depends on the amount ordered, and the order can be shipped anywhere the shopper chooses.
If customers do have to fork over money for shipping, online retailers want to make sure they get what they pay for. Companies are embellishing the experience of receiving the shipment, literally trying to re-create the feelings of anticipation shoppers get when they walk through the doors of a supermarket.
“We’ve got a very special box. We see it as another customer touchpoint and a way to build a relationship,” said Demb of the boxes that come from Abe’s. “It’s not just a logo, it’s an activity that includes the whole family. The idea is, how can you reuse this box?”
Vitacost recently upgraded the shipping containers to better protect the products that are shipped. Boxes are now packed with wine dividers that isolate fragile items and reinforce the structural integrity of the outer carton.
“The dividers improve the out-of-box experience,” said Zucker. “So now when you open it up, it’s a lot more presentable. The flour isn’t on top of the potato chips, and that can of tuna you ordered hasn’t been rattling around inside.”
Abe’s has extended the box experience to a new sampling program called Discover Natural. For $5 (with an identical credit for a subsequent purchase), Abe’s will ship three sample-size products chosen by the customer from a list.
“It’s one way we try to help you not just touch a product, but sample it and give you chance to see if it’s something you want to buy,” said Demb.
The items are nestled in crinkle-cut recycled paper shred and come with a card reminding the recipient, “It’s all about the little choices that make you feel good.” It goes on to list a few: “Quitting your first job. Asking out your crush. Supporting the underdog.”
Fans of online food shopping who read between the lines will certainly understand that last one.