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Data for today’s episode is provided by Mercator Advisory Group’s Report: Online Grocery: Grocers Meet the Challenge of Digital Demand, but Can They Do It at a Reasonable Cost?
Online Grocery Satisfies Consumers’ Need for Efficiency:
- Many consumers initially shifted their grocery shopping online as a safety measure during COVID.
- By mid-2020, the top reasons consumers named for online grocery shopping were efficiency-based.
- According to a Power Reviews survey, 59% of consumers named saving time as their primary reason for shopping online.
- 49% of consumers named personal safety as their primary reason for shopping online.
- The top deterrent for online grocery purchasing is the cost.
- Many merchants cannot afford to compromise on the last mile, and consumers may soon sacrifice cost for convenience.
Although online grocery struggled against other online verticals prior to 2020, recent growth shows the online grocery vertical is here to stay. As consumers shopped online due to COVID-19, online grocery growth outpaced the rest of the e-commerce segment. Given recent consumer sentiment, Mercator predicts growth will remain strong in the coming years. Grocers were able to match consumer demand by utilizing cost-saving investments and implementing innovative technology to facilitate fulfillment. While consumers expressed the desire to continue shopping online, they also noted pain points with online grocery shopping. Given the new growth in this budding industry, Mercator believes that merchants and payment processors have the ability to gain market share by implementing cost effective fulfillment strategies and facilitating technology-driven payment methods. A new research report from Mercator Advisory Group, Online Grocery: Grocers Meet the Challenge of Digital Demand, but Can They Do It at a Reasonable Cost? explores the trajectory of the online grocery market and the ways in which merchants and payment processors can take advantage of consumer sentiment to cut costs and drive sales.
”The pandemic-driven, stay-at-home lifestyle in 2020 propelled U.S. online grocery sales to record volume as consumers sought ease of ordering, seamless payment, and convenient delivery. As the Great Reopening occurs in 2021, online grocery shopping will remain popular among consumers. Grocery merchants and their payments vendors can benefit from this digital channel opportunity, but must meet the challenges of online order fulfillment,” commented Raymond Pucci, Director, Merchant Services at Mercator Advisory Group, and author of this report.