by Rick Rusch/Special to The Shelby Report
Technology is impacting consumers’ behavior in virtually every aspect of life. Including grocery shopping. Grocers who address consumers’ taste for technology in shopping will win easily over competitors who chose to ignore the trend.
Smartphones and technology
Driven in large part by the smartphone, consumers today are armed with powerful computing tools in their pockets or purses. Smartphone ownership grew by 19 percent in 2012, according to comScore, a provider of digital analytics. Total smartphone ownership in the U.S., as of December 2012, is 54 percent.
It’s possible that well over half of all consumers entering a grocery store are carrying a smartphone. Smartphone-toting consumers are savvy shoppers. And they have high expectations for the retailers they transact with when it comes to the technology available to assist them in shopping.
Today, 52 percent of consumers use technology in their grocery shopping. Nearly a third (32 percent) are using online coupons, while almost the same number (31 percent) are using mobile technology for tasks such as making shopping lists, finding recipes or researching products when grocery shopping. Nearly one in four shoppers (23 percent) are checking prices at multiple stores online before they go grocery shopping.
As you might expect, your consumers are multi-tasking. When grocery shopping, one-quarter of shoppers use technology in at least two ways, and one out of 10 shoppers use it in three ways.
The technology most widely used by consumers is getting online coupons pre-trip. And other than tracking their shopping list while in-store, most activities occur prior to entering your store.
This places just as much significance on a grocer’s digital store as the physical store. And that’s where many grocers fall short.
Is technology important to your business?
In order to appreciate the importance of mobile technology and your business, consider these facts:
- Two-thirds of smartphone users say a mobile-friendly site makes them more likely to buy a company’s product or service, and 74 percent say they’re more likely to return to the site later.
- 61 percent say that if they don’t find what they’re looking for (probably within about five seconds), they’ll click away to another site. Half say that even if they like a business, they’ll use its site less often if it doesn’t work well on their smartphone.
- 72 percent of users say a mobile-friendly site is important to them, but a nearly unanimous 96 percent have visited sites that aren’t.
These data points were revealed in a survey of about 1,100 U.S. adult smartphone users (not tablets, in this study) conducted by market research firms Sterling Research and SmithGeiger in September 2012.
Consumers expect technology from grocers
Consumers are embracing e-commerce like never before. And online purchases are not only limited to electronics, entertainment and apparel.
According to Nielsen, online consumer packaged goods (CPG) sales more than doubled between 2006 ($5 billion) and 2010 when they reached $12 billion or about 2 percent of CPG sales. As the tech-savvy generation comes of age and forms households, online sales of CPGs are projected to reach $25 billion, a 500 percent increase from 2006.
Today, a relatively small percentage of consumers purchase core grocery products online regularly. While buying groceries online is a small number today—it is probable it will increase…and rapidly.
Consumers buy groceries online for a number of reasons, and most of them are reasons traditional grocery stores should be able to address.
Topping the list of why consumers prefer to buy groceries online are: convenience of home shopping, convenience of delivery, wider selection and ability to read reviews as well as ease of comparing prices and research products.
Technology mega-trends impacting grocers
According to Phil Lempert, editor of Facts, Figures and the Future, grocers must be aware of four mega-trends in 2013, one of which is technology. Technology is changing the way the consumer shops, and retailers should respond accordingly.
Lempert points out that “shoppers adopted new value-seeking habits during the recession, many of which they plan to maintain permanently.”
As in other sectors, technology makes value seeking in grocery easier, so value-seeking behavior is likely to increase. Just as consumers can efficiently compare availability and price for hotels, airlines and car rentals, they can do so with groceries as well.
Ignoring what the consumer wants, how they get it and why they want it is perilous. If the thought of embracing technology is intimidating or viewed as cost-prohibitive, think otherwise. It is neither. Most importantly, embracing technology is essential. Don’t let technology be the reason your competition steals customers away from your grocery business.
Rusch is managing partner of Thought-Tech LLC, a brand communications firm. Thought- Tech guides clients in branding, marketing and selling. Thought-Tech has launched MobileBrandLinx a custom Quick Response (QR) code product and service to extend branding and packaging for retailers. Rusch can be reached at [email protected].