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The Future of Grocery PDF
The Future of Grocery PDF
The Future of Grocery PDF
OF GROCERY
E-COMMERCE, DIGITAL TECHNOLOGY AND
CHANGING SHOPPING PREFERENCES
AROUND THE WORLD
APRIL 2015
PART II: CHANNEL SHIFTING AND THE SHARE OF TRADE AROUND THE WORLD..................20
LARGE STORES LEAD THE WAY, BUT SMALLER FORMATS GROWING MORE RAPIDLY......21
• Growth of online grocery shopping is driven in part by the maturation of the digital
natives—Millennials and Generation Z
• Willingness to use digital retailing options in the future is highest in Asia-Pacific, Africa/
Middle East and Latin America regions
• E-commerce is well suited for stock-up and specialty-needs retailing because it can offer
deeper product selections than may be available in brick-and-mortar stores
• Use of online or mobile coupons and mobile shopping lists are the most cited forms of
in-store digital engagement in use today
• For in-store retailing, large stores have a sales volume advantage, but smaller formats are
growing more rapidly
THE FUTURE
OF ONLINE
SHOPPING AND
IN-STORE DIGITAL
TECHNOLOGY
The growth of online CPG sales has been driven in part by the
maturation of digital natives, the consumers who grew up with
digital technology (the Millennials and now Generation Z). These
consumers have an unprecedented enthusiasm for and comfort with
technology, and online shopping is a deeply ingrained behavior.
Current usage of six e-commerce options (home delivery, in-store
pickup, drive-through pickup, curbside pickup, virtual supermarket
and automatic subscription) is greatest among the youngest
respondents, and they are also the most willing to use all of the
e-commerce options in the future. For example, 30% of Millennials
(ages 21-34) and 28% of Generation Z (ages 15-20) respondents say
they’re ordering groceries online for home delivery, compared with
22% of Generation X (ages 35-49), 17% of Baby Boomers (ages 50-
64) and 9% of Silent Generation (ages 65+) respondents. Younger
respondents are also the most willing to use all of the e-commerce
options in the future.
GENERATION Z
55% 28% (15-20) 20% 55%
GENERATION X
57% 22% (35-49) 11% 56%
BABY
BOOMERS
48% 17% (50-64)
6% 40%
SILENT
35% 9% GENERATION 5% 21%
(65+)
ALREADY
USING
WILLING
TO USE
USE A VIRTUAL ORDER ONLINE AND PICK
SUPERMARKET UP INSIDE THE STORE
GENERATION Z
66% 14% 14% 59%
(15-20)
GENERATION X
61% 10% (35-49) 10% 59%
BABY
46% 4% BOOMERS 6% 48%
(50-64)
SILENT
28% 2% GENERATION 2% 31%
(65+)
ALREADY
USING
WILLING
TO USE
Source: Nielsen Global E-commerce and the New Retail Survey, Q3 2014
53%
61%
58% 65%
55% 50% WILLING 61% 62%
TO USE 45%
42%
37%
22%
19% 13% 12% 13% ALREADY
12% 7% 9%
USING
5%
66%
63% 61%
65% 61%
WILLING 62% 57%
51% 46% 48%
TO USE
ENABLERS BARRIERS
STOCK-UP URGENCY
Products with a steady consumption rate For some categories, convenience is paramount.
and long shelf life are well suited to online Shoppers want to buy and consume a product
purchasing. immediately, without waiting for deliveries to
arrive. In these cases, the nearest store is the
GLOBAL ONLINE PURCHASE INTENT
(NEXT SIX MONTHS):
best option.
COSMETICS 27%
“While the majority will continue to shop for the bulk of their
grocery purchases in store, retailers need to ensure the experience
is pleasant, efficient and relevant to keep shoppers coming back,”
said Dodd. “Infusing technology in the in-store experience will
be an important enabler in this process, helping retailers address
shoppers’ biggest frustrations. But make no mistake, technology
will never be a substitute for the basic elements of a great shopping
experience, including innovative store design, ample selection,
executional excellence and exceptional service.”
26% ALREADY
22% 15% 11% 19% 15% 18%
USING
9% 9% 8%
ALREADY 15%
14% 12% 10% 12% 12%
USING 7% 7%
7% 5%
76%
68% 75% 63%
WILLING 65%
TO USE
ALREADY
14% 15% 8% 10% 11%
USING
CHANNEL
SHIFTING AND
THE SHARE OF
TRADE AROUND
THE WORLD
“Across the globe, we’re seeing the rise of proximity retailing,” said
Dodd. “In the eyes of global shoppers, small and simple is beautiful
right now. While there is some growth for large stores, the real
winners are mini markets, small supermarkets and convenience
stores. And digital is taking proximity/convenience retailing to a new
level of customer centricity. There is nothing more convenient than a
store in your pocket or in your handbag.”
1
For selected categories. See methodology for a list of categories and countries included in the analysis.
DEVELOPED DEVELOPING
1% 1%
2%
2%
5% 2% 6%
5% 13%
7%
7%
35% 12%
1% 3%
30% 38%
EUROPE
1%
NORTH AMERICA 1%
4%
1% 11% 25% ASIA-PACIFIC
7% 4%
1%
2%
20% 17% 7% 11%
41% 5%
24%
6% 12% 18%
8%
32% 7%
MIDDLE EAST/AFRICA
1% 38%
L ATIN AMERICA
4%
4%
6%
6% 4% 13% 5% 33%
5% 4%
9% 11%
1%
18% 42%
34%
1%
5%
For all three categories included in the study, the largest trade
channel was not the one with the highest growth rate, indicating
that global share of trade is becoming more fragmented. In the
food and beverage category, traditional stores are growing fastest
(+5%). Supermarkets and hypermarkets are still important to these
categories, but consumers are increasingly relying on smaller
formats such as traditional stores and kiosks, which fulfill their
needs for convenience and speed. The story is similar for household
product and personal care categories. Hypermarkets still claim the
largest share of trade, but drug stores and convenience stores are
growing more quickly.
DEVELOPED
1%
PERSONAL
CARE 22% 39% 4% 22% 12%
PRODUCTS
1%
HOUSEHOLD
33% 46% 6% 7% 7%
PRODUCTS
1%
FOOD &
BEVERAGE 38% 24% 20% 8% 3% 6%
PRODUCTS
DEVELOPING
2%
PERSONAL
CARE 15% 17% 22% 16% 26% 3%
PRODUCTS
2%
HOUSEHOLD
PRODUCTS 22% 20% 23% 16% 11% 7%
FOOD &
BEVERAGE 11% 10% 46% 4% 13% 17%
PRODUCTS
Latin America exceeds the global average for nearly all attributes.
The exception: convenience, which is the third most cited driver
globally, but falls to the bottom of the list in this region. Just over
one-quarter of Latin American respondents (28%) say convenience
drives them to switch stores, compared with 46% of global
respondents. Staff, on the other hand, is notably more important
in this region than globally. Forty-four percent of Latin American
respondents said staff would drive them to switch stores. In a
culture that highly values relationships and connections with those
around them, friendly faces at their place of shopping is of great
importance.
GLOBAL
AVERAGE ASIA-PACIFIC
AFRICA/ LATIN
MIDDLE EAST AMERICA
NORTH
AMERICA EUROPE
PRICES 72% PRICES 70%
CONVENIENCE 45% PRODUCT QUALITY 49%
PRODUCT QUALITY 43% SELECTION/ASSORTMENT 43%
SPECIAL PROMOTIONS 35% SPECIAL PROMOTIONS 40%
SELECTION/ASSORTMENT 34% CONVENIENCE 39%
STORE CLEANLINESS 28% STORE CLEANLINESS 35%
STAFF 21% STAFF 29%
Copyright
Source:Nielsen © 2015
Global The
Survey of Nielsen Company
E-commerce, Q1 2014
EUROPE ASIA-PACIFIC
MARKET INTERNET PENETRATION MARKET INTERNET PENETRATION
Austria 87% Australia 94%
Belgium 90% China 47%
Bulgaria 59% Hong Kong 81%
Croatia 71% India 20%
Czech Republic 78% Indonesia 28%
Denmark 97% Japan 86%
Estonia 83% Malaysia 67%
Finland 97% New Zealand 95%
France 83% Philippines 41%
Germany 87% Singapore 80%
Greece 60% South Korea 92%
Hungary 75% Taiwan 80%
Ireland 79% Thailand 30%
Israel 76% Vietnam 44%
Italy 59%
Latvia 75% LATIN AMERICA
Lithuania 69% MARKET INTERNET PENETRATION
Netherlands 96% Argentina 75%
Norway 95% Brazil 54%
Poland 67% Chile 67%
Portugal 65% Colombia 62%
Romania 51% Mexico 49%
Russia 61% Peru 42%
Serbia 65% Venezuela 50%
Slovakia 82%
Slovenia 76% MIDDLE EAST / AFRICA
Spain 75% MARKET INTERNET PENETRATION
Sweden 95%
Egypt 53%
Switzerland 89%
Pakistan 15%
Turkey 57%
Saudi Arabia 67%
United Kingdom 90%
South Africa 52%
Ukraine 42%
United Arab 96%
Emirates
NORTH AMERICA
MARKET INTERNET PENETRATION
• Personal Care: Bar Soap, Facial Moisturizer, Feminine Care, Hand &
Body Care, Mouthwash, Shampoo, Conditioner, Tooth Paste, Tooth
Brushes
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consumers Watch and Buy. Nielsen’s Watch segment provides media and
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the industry’s only global view of retail performance measurement. By
integrating information from its Watch and Buy segments and other data
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as well as analytics that help improve performance. Nielsen, an S&P 500
company, has operations in over 100 countries that cover more than 90
percent of the world’s population.
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