According to a recent Forbes.com story, The Food Marketing Institute estimates that online grocery sales will reach $100 billion by 2025, or about 20% of the grocery retail market. Today it is estimated that 2.0% to 4.3% of industry sales originate online.
Amazon currently leads the way in the online grocery market, with an 18% share as of December 31, 2017.
However, a new study by Morning Consult revealed that a majority of Americans prefer the in-store shopping experience over online shopping when it comes to groceries. According to the study, 65% of consumers say they have no interest in buying food and beverages online, even when their options improve.
The study (conducted in May among 2,200 American consumers) also found the following:
- One-third of those surveyed had previously purchased food or beverage products online at least once.
- Early-adopters of online grocery shopping consist of high-income shoppers ($100k+; 45% have purchased groceries online), GenXers (39%), middle-income shoppers ($50k – $100k at 38%), men (38%), millennials (38%), and urbanites (36%).
- Of the consumers who have ordered groceries online, 56% have only done so a few times per year.
- Of those shoppers that purchase groceries online on a weekly basis, middle-income shoppers are way ahead of those with high incomes. Affluent shoppers prefer to shop in physical stores for their weekly groceries. And since typical affluent households spend 75% more on food than the average shopper, the study describes them as store shoppers that really matter. These high-income consumers have remained loyal to shopping for groceries in person.
Based on the findings, Morning Consult stated that enhancing the in-store shopping experience is the bigger opportunity that food retailers are overlooking in their race to home delivery of online orders.
According to Morning Consult, “By trying to push more grocery sales online, retailers are depriving themselves of the opportunity to entice shoppers to spend more in-store through attractive displays, strategic merchandising, helpful and friendly personnel and mouth-watering sight, smell and taste experiences that can only be found in-store. Just go to any Wegmans to see how exciting and fun grocery shopping can be. This is where grocery stores can really clean up.”