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Online Grocery Options Still Lagging the Market

November 23, 2016         By: Steven Anderson

Back in 1974, the grocery store was a vastly different place. In many cases, in fact, it was a much smaller place.

There were on average about 9,000 different items in a 70s grocery store, which still sounds like a lot, but dwarfs in comparison to today’s market.

Reports note that in 2014 the average was closer to 47,000 products, or over five times what the 70s store held, and that’s just one issue that’s contributing to a general hampering of online grocery options.

Online retail in the United States has been on the rise since 2011, and with good reason. More options, greater convenience, and items delivered right to one’s own front door recommend this approach, and anyone who’s seen a Black Friday shopping video knows at least secondhand why using Amazon for Christmas shopping is smart.

With $101 billion spent online in just the third quarter of 2016, and all of 2015’s online grocery purchases adding up to less than two percent of the total, it’s obvious there are clear problems to surmount in getting people to buy food online.

One of the big problems is the growing number of options in general. Too many such options will actually prompt large numbers—40 percent of consumers in one report—to leave a retailer’s website altogether. Then throw in issues of delivery and infrastructure, and it’s a deck stacked against the retailer.

There are changes coming; we’ve seen not so long ago how companies are using a drive-thru window system to allow customers to pre-order groceries for later pickup, and this is just one point where grocery stores could learn from fast food shops. We know that mobile apps are commonly used to preorder goods; so why not allow customers to place those advance orders for pickup? Better yet, let customers pay for that order from the app, connected to a credit or debit card. Then offer a loyalty program connection from right within the app.

We’ve seen fast food embrace mobile, and frankly, there are few parts of this grocery stores couldn’t do likewise with their own operations. This could certainly speed things up, and though it’s not quite as completely online as Amazon is, it’s still a great new way to put mobile payments to work for something we routinely buy anyway.