Omnichannel in Grocery: from Evolution to Revolution

Omnichannel in Grocery: from Evolution to Revolution

Naomi Sleeper
Vice President Continuous Improvement and Strategic Initiatives
Imperial Distributors

 

The COVID-19 pandemic has heavily affected consumers’ grocery shopping behavior. In addition to the sweeps in product demand discussed last month, shopping methods and channels have also changed dramatically.  With online grocery sales growing exponentially over the last few months, the shift toward omnichannel for grocery has accelerated.

During the pandemic, we have seen an increase in fluidity of consumers’ grocery shopping. Some consumers who had been shopping online habitually prior to the pandemic turned to brick-and-mortar stores to meet immediate grocery needs during the pandemic, according to Kearny. However, as consumers became more concerned about crowds in stores and e-tailers, more people began shopping online. According to FMI U.S. Grocery Shopper Trends 2020 (April 2020), online grocery shopping as a percent of total grocery spend doubled between February (14.5%) and March/April (27.9%) of this year; and 20% of online grocery shoppers were new to this method of grocery shopping.

With improvements to operational hurdles that challenged grocery delivery/pickup providers, limiting grocery e-tail capacity earlier in the spring, growth in grocery e-commerce has continued through May and is projected to sustain. The Shelby Report reported a 24% increase in online grocery deliver & pickup dollar sales and 18% increase in online grocery orders between April and May. Average spend per order, number of customers and purchase frequency also all increased between 5.9 and 7.5%. As pandemic-related health concern persist through the summer and shoppers grow more accustomed to regular online grocery shopping, demand for omnichannel is expected to remain high.

The accelerated need for omnichannel in grocery points to a critical opportunity for supermarket non-foods, as well. Unsurprisingly, online sales of non-food products, including a variety of health, beauty wellness and general merchandise categories, already well positioned for e-commerce prior to the pandemic, has also experienced tremendous growth this season (many with triple-digit year-over-year percent increases, according to Stackline). The opportunity for shoppers to buy non-foods products in the same online transaction as their grocery purchase appeals to consumer priorities of convenience and efficiency. The potential for an expanded online offering in these categories also means supermarkets can further capitalize on increased online traffic with an “endless aisle” of product.

Imperial has developed direct-to-consumer order processing and shipping capabilities to help supermarkets meet these rapidly growing omnichannel needs. With broader assortments, streamlined ordering and direct home delivery, these services will support supermarkets’ growth in the context of new consumer demand and buying habits.