Is Grocery the next big thing for eCommerce?

grocery image

I’m just back from Las Vegas this week after attending an industry event called Xchange hosted by the leading SaaS eCommerce software provider Demandware. Even after having been in this industry over 20 years myself, I continue to be amazed at the pace of innovation as well as the broadening of industry segments that are embracing the eCommerce channel. I met industry players from Fashion, Footwear, Coffee, Cosmetics, Consumer Package Goods (like P&G), and many more, including one eye opener, Grocery. Yes Grocery!

It’s been over 10 years since I’ve seen any signs of eCommerce life in the Grocery channel in the USA. Early grocery channel pioneers Webvan and GroceryWorks both made substantial efforts to pioneer this industry segment into the mainstream of eCommerce during the early part of the 2000’s, but neither had much success at all in wooing consumer buying patterns or in defining a sustainable business model. Technology limitations & the lack of wide spread broadband telecom in homes in the USA, both of which were particularly exposed with the huge range of products in grocery, along with channel conflict from traditional grocers and a lack of decent rich content media destined their efforts to failure. Since their fall out, we’ve not seen much focus by any key players to truly promote grocery online. While Walmart and several others offer some range of grocery products online, its pretty clear from shopping their online stores that its more of an afterthought than any area of focus.  But is the tide soon to change?

With the vast improvements in technology capability and the common place of powerful broadband telecom now in the hands of the consumer, along with the huge propensity for US shoppers to shop online, it seems to me that the stars are aligning. A recent Nielsen report sited that the intent of US consumers to buy grocery and beverages online has grown 44% since 2010. Further, the rapidly evolving trend by brands and retailers to meld together their traditional channels into a single image or Omni Channel* I believe puts grocery at the cross section of industries ripe for a major change. As I look at the foundational concepts of the Omni-channel commerce movement that I helped define a few years ago that include, shopping without channels, delivery without limits & conversations without confusion, I see huge potential for a forward thinking grocery chain (hey Whole Foods, HEB are you listening?) to launch a successful market shifting strategy that will bring new definitions of convenience and time saving to one of the most frequently occurring shopping events in every household across the USA. Imagine a well organized display of grocery products online, suggestive baskets, real time coupons, highly relevant predictive ordering, event & theme shopping (how about a Fondue evening with friends…what do I need?) and being able to chose when, where and how you want to get your products. All of this activity could leverage existing store fronts and inventory, reconfigured to support the changing trends.

Alas when my wife wants me to grocery shop, I can do it while watching my Dallas Cowboys lose another game and then run out at half time, select my own steaks in the meat market to go along with my already prepared online order and be back before the 2nd half kick-off. Now that’s a great consumer experience!

From the front door of the web, until next time!

* A trend being touted under various industry buzz words including; multichannel, omni channel, iCommerce, showrooming.

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