by Mary Margaret Stewart / staff writer
Online grocery shopping has doubled its share of food retail spending during the COVID-19 pandemic, according to findings from FMI – the Food Industry Association and The Hartman Group. On June 24, the association held a follow-up webinar about its recent report, 2020 U.S. Grocery Shopper Trends.
Titled, “How COVID-19 is Reshaping Online Grocery Shopping,” the webinar provided deeper analysis of online grocery shopping amid the pandemic, with input from Doug Baker, VP of industry relations for FMI, and Laurie Demeritt, CEO of Hartman.
The session kicked off with this statistic: During the first two months of the pandemic, about 20 percent of all Americans tried online grocery shopping for the first time.
“From an experiential standpoint, there’s been some mixed emotions about it. But clearly, the motivations for shopping online are really important here,” Demeritt said. “In the past, pre-pandemic, people would typically go online because they thought it would help save time or save money. And that’s still important. But clearly, the issue and the motivating factor right now is safety.”
Demeritt went on to say that online grocery shopping options have “truly delivered” for consumers, giving them access to fresh food without the risk of exposure for themselves or their family members.
“A lot of the things that have been sort of Achilles heels in the past for online – maybe fresh items, produce, dairy, meat – are all things that people have been buying during this time,” she said. “And so, if that experience has been a good one, I think that really widens opportunity for online.”
And while consumers are experiencing some trial and error, so are retailers, with Baker offering their perspective.
“I think that if you were going to have a conversation with retailers about it, they would probably tell you that it was a challenge,” Baker said.
“But if you think about the fact that some retailers were experiencing 300 percent increases in volume of online shopping – and some of them we heard were even receiving as many orders in one hour than what they would receive in a typical week to 10 days. So, at that pace – I believe in that unprecedented demand – the platform delivered.”
Despite some challenges, Demeritt and Baker both said consumers have and will continue to see the positive possibilities for online shopping.
“As long as they were somewhat patient, the retailers were testing and learning, and they were opening up more windows,” Baker said. “And there’s continued work, and now that there’s an opportunity for retailers to take a breath, that work is undergoing, and they’ll continue to improve that experience.”
And as Baker pointed out, following consumer demands leads retailers to investing in online shopping as one of their channels.
“The one thing that I think is really unique about our industry is that retailers continue to look at the consumer,” he said. “Whether it’s pre-COVID or during the pandemic or even once we get past this, the consumer is always at the center of their decision.”
Building off of what’s working and what’s trending, Baker and Demeritt spoke to improving the online grocery shopping experience.
Demeritt posed improvements from two angles – the functional and the emotional – some of which can be controlled by the retailers, she said.
“One of the aspects of culture that’s changed around food is our lack of planning when it comes to meals these days,” she said.
“The idea of waiting until the last minute to decide what to have and knowing that you can get it – in the past, anywhere and anytime – has really changed the role of planning in our lives.”
And it’s this “last-minuteness” that Demeritt deemed hard for retailers to address. Although online shopping and delivery are getting faster, it can be hard to stay ahead of the curve. Almost half of all dinners are decided on within an hour of consumption, she said.
As for the emotional aspect, Demeritt said replicating the “discovery” of shopping or the human connection found in grocery stores is difficult online.
Baker went behind the scenes for retailers, adjusting to changing trends for pandemic and post-pandemic life.
“You also got to look at the execution of online shopping, and if we are going to see the increase continue…it’s really about reducing friction.”
To do so, Baker said stores may need to offer online services with more efficiency, whether that’s by hiring more employees or investing in automation.
Retailers are looking to refine their e-commerce in different ways, whether that be in-store, dark store, micro-fulfillment centers or customer fulfillment centers.
Paired with consumer perception, Baker pointed to the price of automated systems for retailers, which require a large amount of investment on the front end. And the capacity and ability to pay for these systems differs for each retailer.
To Demeritt, perception is key.
“Whether true or not, there is a belief that if someone is picking groceries for you, that you would like that person to be a store employee,” she said.
Added Baker, “When you talk about fresh – and that’s sort of the big question mark…is a robot going to be able to handle my bananas, and they actually get to me and they’re not black and blue?”
In sum, consumers want someone who “really knows and appreciates food” – that can pick out nice produce and meat – doing their shopping, Demeritt said. This perception can stir hesitation on the part of consumers when envisioning automated systems – that maybe some advances won’t result in the highest quality selection of goods.
“So, in many instances today, even with micro-fulfillment, there’s still this activity that’s called topping off,” Baker said. “That’s when it leaves that automated area and it goes into where there’s a human actually pulling the product off of the shelf.”