TechBytes: Three weapons in the online grocery delivery war

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TechBytes: Three weapons in the online grocery delivery war

By Deena M. Amato-McCoy - 07/16/2018
The online grocery battle continues to heat up, and traditional supermarket operators are feeling the pressure.

Consumers expect faster, more convenient ways to shop for and receive their groceries. They want options that enable them to purchase weekly staples via laptop, mobile apps, or in some cases, by holding a conversation with a voice-enabled smart speaker.

Oftentimes however, the retailers offering these options come from non-traditional grocers. For example, Amazon’s acquisition of Whole Foods Markets last year has given the online giant a physical footprint to expand its brand and online grocery delivery model.

Walmart also continues to expand its grocery delivery business, and is well on its way to offering the service in 100 metro areas across the U.S. throughout 2018. The same is true for Walmart’s Sam’s Club banner. Through a deal with Instacart, the warehouse club chain now offers same-day grocery deliveries in limited markets.

Through its acquisition of membership-based delivery company Shipt, Target now offers same-day deliveries in more than 135 markets. The discounter also offers curbside pickup service in its Midwest and Southeast markets.

Each effort is a wake-up call for traditional grocers to explore new ways to step up their own online deliveries, and get merchandise into shoppers’ hands faster.

By embracing the following trends, traditional retailers can carve their own niche in the online grocery delivery game:

• Managing fresh foods must be a priority. Grocers need to step up their fulfillment operations — especially when managing fresh merchandise. The logistics of storing and packing orders must align with delivery times and shipping methods, all while keeping product fresh.

Some grocers will deliver merchandise from their stores or warehouses. Others will choose to forego the costs and complexity associated with managing deliveries and offer curbside pickup. Regardless of the strategy, retailers need to understand which service is most valuable to their customers, yet still feature high-quality merchandise.

• Curated shopping baskets are becoming more prevalent. Whether the goal is to offer more personalized offerings or make the ordering process easier for the customer, supermarket operators should consider offering curated online shopping baskets. By analyzing customer preferences and shopping patterns, retailers can target customers with a distinct collection of groceries that contains staples or unique merchandise personalized to their needs, from pet food to wine or craft beer. The goal is to become a trusted partner that makes it easier to shop for groceries online.

• Voice ordering is on the rise. The proliferation of voice assistants, from Alexa and Google Assistant to Siri, are primed to change how consumers shop for groceries. Once again, non-grocers are leading the charge in the voice-assisted ordering space. For example, Amazon enables customers to use its Echo smart speakers to order merchandise.

By teaming up with Google, Walmart allows customers to shop for merchandise via Google Assistant, the search giant's online shopping platform that lives on the Google Home smart speaker. Similarly, Target offers voice-activated ordering through Google Home for Target Restock, its next-day delivery service of household essentials.

As more supermarket operators fall in line and enable customers to order products without lifting a finger, they will create an opportunity to streamline online ordering, while simultaneously driving loyalty.

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