If someone told me that online grocery shopping will become absolutely normal five years ago, I would have struggled not to laugh. But the Covid-19 pandemic with its social distancing, restricted movement in public and even lockdowns has reconfigured the parameters. Online grocery shopping is it here to stay, and has potential for growth.
E-food currently has a market share of one percent in Germany. Experts state that “we will not reach a ten percent share within a year, as in the UK, where online grocery shopping has been trusted for some time. But a doubling of the share to two percent within the next twelve months seems possible. In three or four years, it could be around five percent.”
As in other industry segments, e-commerce has become the best alternative to continue with business and enables establishing value-added services to all those people who, right now, prefer or have been forced to make their purchases online.
In the last months, many people who had never done their supermarket shopping online before, have discovered its great efficiency and comfort. Some will return or tell others and maybe continue with this comfortable practice.
The benefits of digitizing commerce
If you're in the food business but still hesitant to tackle e-commerce, take a look at these facts. Why is it time for your organization to invest in the digital experience?
- E-commerce transactions are expected to exceed $951 billion by 2023 (that is, they will almost double in 5 years, if we look at 2018 data with $550 billion spent). Purchases made in the physical store will stagnate or decline. (Source: Forrester Research)
- According to different studies, we have 8 seconds or less for a customer to find what he or she wants on our website. 80% of buyers will abandon a site if they have had a bad search experience. (Source: Kissmetrics)
- 86% of buyers are willing to pay more for an excellent customer experience. It is believed that this 2020, the main key differentiator of a brand, will be the customer experience, which will exceed the price and the product. (Source: Walker Customers 2020 Report)
What are the benefits of online grocery shopping?
- You can offer your services 24 hours a day and process a high number of orders.
- Increased orders and average spend per cart: If customers don't have to carry it, they buy more products and in a higher quantity.
- Expansion. Your customers can be anywhere in the country, not just in your neighborhood.
- Omni-channel shoppers spend more: 10% more spending in the online channel than in the physical store.
- Possibility of up- and cross selling: Offer a better product than the one the buyer was going to buy, as well as offering products related to the one he or she has bought (e.g.: Buyer was going to select a pork fillet. The online shop offers you the beef tenderloin on offer - more expensive than the pork tenderloin; and it also recommends a wine and sauce to accompany it).
- According to Forrester Research (an independent market research company), by 2021, online channels will affect 50-55% of all European sales in some way. Whether it's online transactions directly or influencing in-store sales from the digital channel (for example, when a user searches for product information on the internet or receives a newsletter about the product).
- Improvement of the brand image.
- Increase customer loyalty - for example with a dedicated app.
Coop: Artificial Intelligence for an online grocery shopping app
Coop Netherlands had a successful chain of supermarkets as well as an online store, but they wanted to be able to offer more for their customers. They contacted Incentro with the idea of creating an app to be able to buy via mobile.
An idea evolved: “How about an app that helps you keep the fridge full at any time?” What started out modestly developed into an app with incredible functionalities. Together with Intershop, Incentro Spain created a sales app with artificial intelligence that learns from customers’ preferences and has a product scanner to optimize the search time.
First came the image scanner. Javier Sainz-Maza, consultant for Incentro Spain, says: “Based on Google Cloud image recognition software, we built an intelligent product scanner. Not the typical barcode reader, but a tool capable of recognizing vegetables, fruits, product packaging and even items from other supermarkets. So, just before you beat the last egg, you take a picture and a new package is added to your shopping list. It allows you to basically cook and buy at the same time!”
On top of that, they created automatic shopping lists, thanks to which you don't need to navigate the app “up and down”. A machine learning solution was also implemented: The more you use the app, the more efficient it becomes, as it learns from your preferences.
Once this app was launched, Coop online sales grew more than 25%. Today, 30% of sales are made via app.
Intershop partners Incentro Spain are experts in E-commerce, User Experience and Digital Transformation, which allows them to have a global vision of their clients' needs. They have been helping companies to reach their maximum potential since 1996 and have more than 350 specialists to do so.
Do you want to know more about the potential of online grocery shopping?