Top Challenges & Trends in the Online Grocery Business

Challenges in online grocery business

Consumer behavior and expectations play a major role in creating challenges for fresh food retailers when it relates to grocery eCommerce. Today’s consumers demand a diversity of products, and they expect everything that they buy in-store to be available online. That can lead to fulfillment headaches for store staff, especially when it comes to the fresh items that require more time to select the best item.

Top Grocery eCommerce Trends:

Sales by Product Category

Before the COVID pandemic, research by market intelligence agency Mintel found that consumers were wary of the freshness of grocery items they bought online and only 10% said they would buy fresh produce, meat, poultry, or fish online. The pandemic forced many consumers to change their online behaviors, yet some consumers are still hesitant to allow others to select their fresh items. Their preference on how green their bananas should or should not be or how they pick milk based on the latest expiration date on the shelf might not be what a store employee or a person picking up a shift at Instacart would select.

During the height of the pandemic, Supermarket News ran an article that showed an increase in online sales for all product categories versus the year before, but there remains to be a large chasm between what is being bought online from non-fresh to many of the fresh categories:

  • Non-fresh food (68.5% of respondents bought online)
  • Toiletries, personal care, and diapers (63.1%)
  • Household cleaning and paper products (60.8%)
  • Frozen food (41.9%)
  • Bread and baked goods (41.7%)
  • Fresh fruit and vegetables (39.1%)
  • Fresh dairy, meat, fish, and eggs (38.9%)
  • Chilled prepared foods (26.4%)

Curbside Pick-up vs Delivery

As online grocery shopping soared, more consumers started testing the waters of grocery delivery, but many still seem to be unwilling to pay for fast home delivery of fresh foods, demonstrating an impact of the “Amazon Effect” where consumers expect shipping and delivery for free. To accommodate grocery eCommerce trends over the last year, improvements were made in last-mile logistics for grocery delivery, reducing the costs and time to consumers. However, many consumers have turned to curbside pickup. As illustrated in the Brick Meets Click/Mercatus Grocery Shopping Survey, curbside pickup has become the dominant leader for online sales, outpacing both delivery and ship-to-home.

online grocery shopping stats graph

Solutions to the Challenges in the Online Grocery Business

There is no denying that the recent pandemic accelerated change for eGrocery, and no matter what item or what method of delivery were selected, food retailers have been forced to adapt their eGrocery options.

With the use of data and analytics, retailers continue to make major steps forward for fresh food eCommerce. With the right technology, retailers are better able to determine and match supply and demand both in-store and online, reducing the food waste that comes from extensive overhead and forecasting labor needed to fulfill orders.

With ADC's fresh item management and eCommerce fulfillment platforms, food retailers across the globe have addressed the challenges faced by this evolving marketplace.

With ADC, retailers can manage in-store fulfillment, standardize recipe management, track inventory effectively reducing waste, digitally manage food safety protocols, properly plan production, forecast what needs to be ordered while calculating lead times on those orders, and everything in between.

ADC's innovative tools enhance store operations, increasing efficiencies across the store and driving increased profit. Whether in-store or online, ADC's tools improve the grocery shopping experience for everyone involved.

Read more about ADC's innovative offerings from Made to Order and Temperature Monitoring to our grocery eCommerce Fulfillment platform built to scale with your eGrocery business.