Year in Produce No. 3 — Growth of e-commerce

Year in Produce No. 3 — Growth of e-commerce

Grocery stores got busier than ever as stay-at-home orders in many states forced restaurants to close, and many people took advantage of online grocery services to avoid the crowds.

Analysts have stated that the growth of online grocery in the first few months of the pandemic brought the segment to a level it wasn’t expected to reach for years.

Dec. 9 

Online delivery helping to shape produce packaging

By Jim Offner

The rapidly evolving online grocery delivery channel will have a say in packaging styles and materials over the near and long terms, marketers say.

Consumers in the U.S. have shifted a significant part of their shopping online, but it is not yet known if this trend will continue at the same trajectory, said Liz Walsh, director of customer and consumer insights with Atlanta-based Georgia-Pacific.

Some industry forecasts predict the penetration of online delivery will reach 10% in 2020, compared to an estimate of 2-3% before COVID-19 pandemic, Walsh said.

“This will have significant implications for packaging design, which has been optimized for traditional retail versus online shipments. Likewise, there is a need to optimize delivery for freshness/cold chain management,” she said.

Nov. 24

Survey: Consumers who’ve shopped online during pandemic plan to continue

By Ashley Nickle

A new survey by Oracle Retail found that 93% of U.S. consumers who’ve shopped for groceries online during the pandemic plan to continue doing so post-pandemic.

The survey polled more than 500 consumers in the U.S., and 53% of that group report they have bought groceries online during the pandemic, according to a news release. Among those who have bought groceries online, 37% say they have been purchasing in that channel more frequently than they have been buying groceries in stores.

Nearly all the respondents who’ve shopped online during the pandemic plan to continue doing so, and 74% expect to shop online as much as they are now or even more frequently.

Nov. 12

Michael Schutt of Raley’s talks e-commerce at WCPE

By Ashley Nickle

Raley’s opened four stores this year, including a dark store to help with fulfillment of online grocery orders. While the pandemic significantly accelerated the interest in online grocery across the country, Raley’s already had been expecting growth in that area.

“E-commerce is going to be a key component to our future business,” said director of produce and floral Michael Schutt. “When you look at the growth of millennials and Gen Z consumers, as brick-and-mortars, we just feel that we have the upper hand on how to deliver on that experience over maybe a warehouse that’s picking (items). The key is really for us to build a rapport with the customer and make it more personalized than just clicking a button on a computer.

“We have the talent to be able to do that because we engage with customers every day,” Schutt said. “That allows us to pivot with substitutions, and I think those are the places where you can really lean in if you’re a grocer.”

Nov. 11

Analyst: Amazon’s grocery stores should be taken seriously

By Ashley Nickle

Precise location and efficient operation of stores are among the reasons the grocery industry should be taking seriously Amazon’s new Fresh banner, said Bill Bishop, chief architect of retail consulting firm Brick Meets Click, during a session at the West Coast Produce Expo.

“They are stores that we have to take very seriously even though they look quite traditional or conventional because they’ve got some operating characteristics that are going to make them really durable,” Bishop said.

Another area to watch is how Amazon could experiment with pricing to incentivize certain items to be purchased in stores versus online. There has been some analysis that suggests the retailer is already working on this, Bishop said.

“If, for example, the product is a fragile product that doesn’t lend itself to go through the sort of normal warehousing operation and would be handled more effectively through the store, then they’ll actually make it cost more for you to buy it online than in the store ... ” Bishop said. “It may be that they’re using price at a micro level to fine-tune their business. If they are doing that, that opens up an entire new set of possibilities we’re all going to have to think about differently.”

Sept. 14

Brick Meets Click: 29% of U.S. households now using online grocery

By Ashley Nickle

Retail consulting firm Brick Meets Click found in its most recent consumer survey that roughly 37.5 million U.S. households used online grocery services in the month of August.

That number represents 29% of U.S. households and growth of 133% from a year ago, according to a news release.

U.S. grocery delivery and pickup sales for August totaled $5.7 billion. In addition, average order value grew to $95 — a record high — and 75% of consumers who had used online grocery services in August indicated they planned to make a repeat purchase in the next month, per the release.