The primary competition for supermarkets online are “basket bandit” sites like Amazon, which siphon off sales, according to Brick Meets Click. One might expect that direct competitors like Peapod posed the greatest threat to grocery stores’ online sales efforts, however, BMC’s survey of 12,000 online shoppers in U.S. metropolitan areas found that sales leakage poses the real threat. Retailers like Amazon, Blue Apron, and Drugstore.com, as well as club retailers, rack up 84 percent of online grocery trips.
Even with the limited rollout of Amazon Fresh, Amazon is the dominant online seller of groceries, and the percentage of shoppers who have bought groceries from the retailer in the past 30 days has gone up by 25 percent since 2013. Brands in the online grocery delivery space can be better poised for success by developing and nurturing direct relationships with consumers, according to Research and Markets. The firm’s report,“How Brands Can Win in Online Grocery,” outlines how companies can understand the major determinants of online success, including consumer reviews, findability, bundling, and mobile, to develop more profitable revenue streams that leverage brand capital directly with customers. Manufacturers who can overcome the limitations of the traditional supermarket grocery model can offer new products and services to build better relationships and drive sales.
The report also addresses how direct customer relationships in the digital world also bring logistical challenges in the physical world, as consumers expect instant service and fulfillment. Consumers will search for the best choice and price, and reward companies that are able to meet their expectations.