How Retailers Can Play Up Strengths, Improve Weaknesses in E-Comm Battle

About half of online shoppers plan to start purchasing more groceries via e-commerce in the coming year, according to the Retail Feedback Group's 2018 U.S. Online Grocer Shopper Study, and retailers are being pushed to improve their grocery delivery services as well as play up strengths that can be found only in-store.

In the study, which asked respondents to rate their satisfaction with 12 different "touchpoints" of grocery delivery, including factors such as online shopping experience and fulfillment, Amazon rated highest almost across the board, followed by Walmart, with supermarkets receiving the lowest scores in general. 

Respondents indicated that online grocery shopping was more time-efficient than shopping in-store and was also more enjoyable, but they also said shopping in-store tended to yield higher quality and fresher products with a better selection to choose from. Additionally, study participants said shopping brick-and-mortar made them feel more valued as a customer  and provided better customer service.

“It’s no surprise that online grocery shoppers find their experience more efficient and convenient," said Doug Madenberg, RFG principal. "But the fact that online shoppers find the experience both more enjoyable and more pleasantly surprising than an in-store visit should be a wakeup call for all brick-and-mortar retailers.”

Additionally, many consumers are still wary of purchasing meat online, and some have had bad experiences in doing so. 

Of the online shoppers who indicated they had received products below their quality standards, 26% said the items in question included meat. As such, 8 in 10 online shoppers (81%) expressed that quality was the top factor that they consider very important when purchasing meat, followed by price (65%) and proper handling and refrigeration (63%).

Those who did not purchase meat online cited reasons such as wanting to choose the meat themselves or worrying that meat would not be refrigerated properly during transport.

Amazon snagged a 4.70 on a 5-point scale, with Walmart at 4.54 and supermarkets and food stores at 4.36. The research also found that baby boomers tended to be the most satisfied with grocery delivery services, giving it a rating of 4.65, followed by Gen X at 4.51 and millennials at 4.43. 

Brian Numainville, RFG principal, said that as online grocery shopping options become more plentiful, consumers are "clearly responding and purchasing a wide range of items" and are more willing to buy fresh items online in higher frequencies than last year. 

This, he said, "illustrates that providers are improving in their ability to overcome objections that historically have been limiters in these areas."

"While there is still room for growth, this finding provides encouraging news for retailers and others offering online food shopping services," he said.

Out of the 57% of shoppers whose order was fulfilled by delivery, about one-third received them through Instacart, which was rated higher than supermarkets on almost all elements across the board except for people factors, which was rated similarly. 

“Clearly Amazon, Walmart, and Instacart are taking advantage of both their experience in the space, and the capital they continually invest, in improving the online grocery ordering and fulfillment experience," Madenberg said. "Supermarkets and food stores operating e-commerce on their own, or through a third-party platform, should take note of Instacart’s scores and ensure their service provides an experience at the same or higher level.”