It seems like there’s a new player in the online grocery space every time you turn around these days. Fairway Market and Gelson’s Markets announced that they’ve signed on with StorePower.com, a new division of Abe’s Markets, the online natural and organic food retailer. We’ve been exchanging information with a new mobile app called Grability. Platforms like GrocerKey and Foodie are attracting more shopper attention, and online marketplace Artizone has started to offer “delivery in 60 minutes.”
Add to this the growing energy around online meal subscription programs like HelloFresh, Blue Apron and Plated — and the overwhelming response Shipt experienced when it launched in Tampa, Fla. earlier this month — and it becomes obvious that shoppers have an almost overwhelming choice of ways to buy food and groceries online.
It’s been clear for a while that a wide range of shoppers would like to do at least some of their grocery shopping online — not just folks who physically can’t get to the store, but this group includes Millennials, busy moms, young professionals, Baby Boomers and the list goes on. It's safe to say demand for online grocery shopping is strong and growing.
So why are we still debating whether or not grocers should make an investment in ecommerce?
Until recently, the doubters could argue it would take millions of dollars just to get started with online grocery, and even that wouldn’t guarantee success. Now, however, retailers have a much wider set of options for offering their customers a way to shop online. Curiously, so many choices seem to be generating a kind of fog that confounds the debate and blurs where the disruptions are coming from specifically and what the best path forward is.
Earlier this summer, I wrote in a Brick Meets Click blog on this subject that it's time for:
• Doubters to accept that online shopping appeals strongly to affluent shoppers, those with children at home and Millennials. Can retailers afford to lose even 1% of these high-margin sales?
• Promoters to recognize that most successful food retailers have driven growth by making major investments in brick and mortar. They can’t afford to walk away from these investments.
• Both sides to recognize that today’s consumers want the combined advantages of both online and in-store shopping — not just one or the other.
In some ways, traditional retailers have the advantage of established customer relationships — and their stores. Moving forward, the challenge at hand — how to get into online grocery without overspending or diverting sales from stores — is still a hot topic in the industry.
What do you think?
Check out a current state-of-the-debate (a.k.a. how to make our way through this big shift) here and share your perspective.