• Only about 3% or 4% of grocery spending in the U.S. was online before the pandemic, but that’s surged to 10% to 15%, according to research by consulting firm Bain & Company.
• Experts say that will likely remain at a higher level because many customers have downloaded apps, tried new services and discovered their conveniences.
• The demand for online groceries, and challenges fulfilling the orders, is inspiring grocers to rethink their approach, too.

For many U.S. shoppers, the coronavirus pandemic was the push they needed to stock their pantries by browsing online instead of store aisles.

If the online shopping habit sticks — even for a percentage of the new or more frequent customers — it could represent a meaningful shift in an industry that’s been slow to go digital.

Only about 3% or 4% of grocery spending in the U.S. was online before the coronavirus outbreak, according to research by consulting firm Bain & Company. That trend has lagged behind many other parts of the world, despite major investments by Walmart and Amazon and the growth of third-party delivery services such as Instacart, FreshDirect and Target-owned Shipt.

In other countries, such as South Korea, China and the United Kingdom, customers have been quicker to adopt online grocery shopping. In South Korea and China, 19% and 14% of grocery spending is online, respectively, according to analysis by Bain, Kantar and Forrester. About 7% of grocery spending in the U.K. is online.

Prior to the pandemic, trends pointed upward in the U.S. One study by the Food Marketing Institute conducted by Nielsen projected that online grocery sales would reach $100 billion and make up as much as 20% of total grocery retail by 2025.

In recent weeks, however, online grocery shopping has accelerated that trend in the U.S., as shoppers have sought ways to avoid stores or at least limit visits. At the height of the pandemic, online grocery sales increased as much as fivefold to between 10% to 15% of total grocery sales, said Steve Caine, a retail expert and partner for Bain & Company.

As the crisis recedes, Caine said he expects online grocery sales to remain at a higher level of between 5% and 10%.

Read the full article here (CNBC – 1^st May 2020)

Image by mohamed Hassan from Pixabay