Billions Flow into the

Digital Grocery Aisles

 Many consumers avoided shopping at grocery

stores during the initial pandemic period, but by
May 2020, according to an Inmar survey,
78.7% of respondents said they had shopped
online for groceries, compared to 39% pre-
pandemic.

 According to the April 2020 Brick Meets

Click/Symphony RetailAI Online Grocery
Survey, online grocery sales increased 37% to
$5.3 billion from March’s $4.0 billion. Then, the
May 2020 survey reported online grocery sales
increased another 24% to $6.6 billion.

 Field Agent’s March 2020 survey of 1,509

adults found 25% said they were shopping
more frequently online for groceries. A May
follow-up survey with 1,010 of those same
adults revealed the percentage had increased
significantly, to 36%.
Online Shopping Patterns

 According to Coresight Research’s 2020 US

Online Grocery Survey (March 2020), consumers
reported their online grocery purchases were
from an average of 5 grocery categories,
compared to 4.4 categories from the equivalent
2019 survey.

 Unsurprisingly, the Coresight Research survey

results revealed 62.6% of online grocery
shoppers had bought from Amazon during the
past 12 months, which was essentially
unchanged for the previous 12 months in the
2019 survey.

 Walmart was second at 52.3%, but had

increased 14.9 percentage points from the 2019
to the 2020 survey. Target was third at 22.9%,
with an increase of 7.2 percentage points and
Costco was fourth at 15.2%, an increase of 6.3
percentage points.
A Flood of New Customers

 Even prior to the pandemic period, online

grocery buying had been increasing
significantly. According to Coresight Research
data, 23.1% of respondents to its 2018 survey
said they had purchased groceries online
during the past 12 months.

 For 2019, 36.8% of surveyed consumers were

online grocery buyers during the previous 12
months, and then the 2020 survey (conducted
during mid-March) indicated an increase of 15
percentage points to 52.0%.

 More meaningful is the YOY increase of

surveyed consumers who planned to buy
groceries online only during the next 12
months: 2018 25.8%, 2019 39.5% and 2020
62.5%. Coresight Research forecasts 2020
online grocery sales could increase 40%, or
$38 billion.
Grocery Deliveries:
Another Convenience Driver

 Although DISQO’s (a data and analytics

company) mid-May 2020 online survey
revealed 73% of respondents had shopped in-
store only for groceries, 6% said they had used
delivery only and 4% in-store and delivery.

 The survey also found 16% of respondents had

more grocery deliveries during the mid-March to
mid-May 2020 period, compared to 4% who
said they were using deliveries less.

 Grocery delivery services were clearly

recognized as a convenience for older adults,
as 85% of those 75 and older said they were
satisfied with their grocery delivery experience
during early May 2020 while 84% of those 65–
74 were equally satisfied.
Seniors Like Grocery
Pickup Services

 Field Agent surveyed 1,509 adults during March

2020, and then conducted a May follow-up
survey with 1,010 of them, asking what changes
they had made permanently to their grocery
shopping. Those “using store pickup and more
often” increased from 7% to 14%.

 Of the consumers participating in DISQO’s mid-

May 2020 online survey, 7% said they had used
pickup only to obtain their groceries during the
past two weeks, and another 7% had shopped
in-store and used pickup.

 As with grocery delivery, older adults were most

satisfied with grocery pickup – 65–74 87% and
75+ 90% – and planned to order groceries for
pickup during the last two weeks of May: 65–74
82% and 75+ 89%.
A Boost to Grocery-
Related Technologies

 The pandemic has accelerated the use of

contactless-payment technology. According to
Mastercard Consumer Polling, more than half
(51%) of Americans used the technology during
February–March 2020.

 Contactless payments were used for 85% of

grocery purchases, more than twice pharmacies
at 39%, retail stores 38%, quick-service
restaurants 36% and transit 9%.

 The pandemic and surge in grocery deliveries

has been a boon for Instacart, as its market
share increased to 57% during April 2020 and
stealing much of the increase from Walmart
which had the largest share during 2019, but lost
25% of its share during March 2020.
Advertising Strategies

 Online grocery shopping may not match the

levels of the early-pandemic period, but more
people will continue to shop online.
Supermarkets are compelled, therefore, to
promote their online shopping platform in their
advertising in other media.

 Local supermarkets are unable (and shouldn’t

try) to compete with Amazon, Walmart, etc. in
the online shopping channel, but they can
promote unique and/or gourmet items in their
standard advertising to drive people to their
online platforms or in-store.

 To promote themselves as forward-leaning

businesses, local supermarkets should consider
featuring/promoting in their advertising their use
of contactless payment devices at checkout,
robotics (for cleaning) and RFID technologies.
New Media Strategies

 Online grocery shopping is a safe choice for

seniors, but many aren’t very tech-savvy.
Supermarkets can help with a series of short
videos for social media posts explaining in very
detailed steps exactly how to use their online
shopping platforms.

 Younger adults with larger incomes are more

likely to be general online shoppers and local
supermarkets can attract their business by
using social media posts to promote unique
and/or gourmet food items they can order
online and which are unavailable at major
chains.

 Ask customers who used/are using the

supermarket’s BOPIS service (which is
essential) and/or delivery service to post short
videos about the convenience, ease of use and
safety of the service.