In this file:

 

·         Walmart, Amazon lead in online grocery, but supermarkets gain ground

Study: Grocery stores see highest percentage of first-time online food shoppers.

 

·         Online grocery: A business model that will never add up

As long as ecommerce retailers embrace the paradigm of competing on price with brick-and-mortar stores while offering same-day delivery, they can't win.

 

 

 

Walmart, Amazon lead in online grocery, but supermarkets gain ground

Study: Grocery stores see highest percentage of first-time online food shoppers.

 

Russell Redman, New Hope Network

Jan 06, 2020

 

In online grocery, supermarkets are holding their own against the double juggernaut of Walmart and Amazon.

 

This year, Walmart zoomed past Amazon as an online grocery destination, according to the 2019 U.S. Online Grocery Shopper Study by Retail Feedback Group (RFG), a Lake Success, N.Y.-based consumer research firm. Of 1,000 U.S. consumers surveyed who shopped online for food and groceries in the previous 30 days, 37% cited Walmart (up from 32% last year) and 29% named Amazon (down from 31% a year ago) as the retail venue. (Infographics courtesy of RFG)

 

Supermarkets were the online grocery shopping destination for 22% of those customers, up from 21% in the 2018 study, while other online grocery providers saw their online grocery share fall to 12% from 15% a year ago, RFG said. What’s more, supermarkets had the highest percentage of shoppers (22%) reporting first-time online grocery use, compared with 18% for Walmart and 9% for Amazon.

 

“As Walmart increases their focus on online grocery shopping, it appears to be resulting in more trial, given the surge in shoppers reporting using Walmart for their most recent online grocery shopping experience, beating out Amazon,” RFG principal Brian Numainville said in a statement. “At the same time, supermarkets/food stores also appear to be gaining ground in increased overall satisfaction as compared to last year and now register the highest percentage of first-time users, showing positive momentum for the channel.”

 

In terms of customer satisfaction with online grocery purchases, supermarkets gained on leaders Amazon and Walmart, which saw declines from last year’s RFG study. On a scale of 1 to 5, Amazon scored 4.60 in the 2019 survey (down from 4.70 in 2018), while Walmart rated at 4.45 (down from 4.54). Supermarkets/food stores improved to 4.43 this year from 4.36 in 2018.

 

RFG’s study examined 12 key satisfaction touchpoints of the online shopping experience, including ordering, fulfillment and people elements, by major provider. Amazon shoppers rated...

 

more

https://www.newhope.com/retail-and-distribution/walmart-amazon-lead-online-grocery-supermarkets-gain-ground

 

 

Online grocery: A business model that will never add up

As long as ecommerce retailers embrace the paradigm of competing on price with brick-and-mortar stores while offering same-day delivery, they can't win.

 

Kurt Jetta, Opinion, Digital Commerce 360 

Jan 6, 2020

 

Jetta is executive chairman, founder and lead product developer of TABS Analytics, a retail and consumer analytics firm

 

Books, strollers, bagged salad and baked beans. You can buy pretty much anything you want online these days. While online shopping may be convenient for consumers, does that mean it’s genuinely a good business for retailers?

 

The answer increasingly is “no.” And that is particularly true for online grocery retailers.

 

In 2016, I began to question the hype surrounding online grocery sales. During an interview with CBS Sunday Morning noted that there was a “follow the herd” mentality as companies entered the business only because others did. Plus, my company’s research showed that consumers were not abandoning their brick-and-mortar grocery stores in favor of ecommerce offerings. That led to questions about whether online grocery would ever have sufficient demand to warrant the massive investment required to support it.

 

Fast forward three years. These predictions have become a reality. Less than 30% of Americans shop online for groceries regularly versus 99% who continue shopping at brick-and-mortar stores. In fact, despite all the hype about the sector, 44 percent of shoppers never purchase groceries online. Further, the upside of online grocery seems limited, as only one in five consumers saying they are heavy online shoppers, in general.

 

While our research uncovered demand limitations with mass-market ecommerce, press reports have started discovering significant issues in the supply side of the equation for these retailers.

 

Walmart increased its online sales by 40% last year, thanks to an expansion of an online grocery business. But it’s now projecting losses of more than $1 billion for its U.S. ecommerce division in 2019. The company is in a precarious position because groceries account for about 60% of its online sales.

 

Amazon said that it had to invest more than $800 million to support same-day delivery. Other expenses racked up, as global shipping costs rose 36% in the second quarter of 2019 to $8.1 billion, and fulfillment spending increased 17% to $9.27 billion. The company also has struggled with perishable sales through Amazon Fresh and Prime Pantry services and has yet to capitalize on its acquisition of Whole Foods.

 

Labor problems are plaguing retailers, too. Amazon expects...

 

more, including links 

https://www.digitalcommerce360.com/2020/01/06/online-grocery-a-business-model-that-will-never-add-up/