Shoppers Choosing Grocery Pickup over Delivery

A new survey says grocery pickup is growing in popularity, but online delivery orders may have peaked.

Mercatus found 75% of consumers prefer grocery pickup over delivery when it comes to online ordering. Sixty-one percent of the more than 40,000 participants in the survey said they tried curbside pickup during the past year. That is an increase from 57% in 2020. However, 46% said they had used home delivery at least once in the past month, which was unchanged from 2020.

When asked why they preferred grocery pickup, the costs of delivery fees and surcharges were the main reasons. While 57% of online customers say that quick delivery is important, only 15% of shoppers were willing to pay extra for home delivery.

Mercatus believes the growing popularity of grocery pickup services will results in diminishing use of home delivery. Before the pandemic, 27% of respondents said they preferred using delivery and that number climbed to 41% during the height of the pandemic.

The company expects consumers choosing home delivery to drop to 24%, especially as retailers continue to improve and expand their curbside pickup options for shoppers.

Sylvain Perrier, president & CEO at Mercatus, said, “Pickup services offer grocers more control over the cost to serve online customers than third-party delivery. Online customers love the precision, flexibility and overall convenience that store pickup provides. And when done well, pickup services make for a better overall shopping experience that builds lasting connections with customers, which will lead to repeat business for grocers.”

U.S. grocery customers also seem to prefer using mobile shopping for orders. When asked how they will be ordering groceries in the coming year, 14 percent said mobile devices. Shoppers were drawn to using their preferred retailer’s app for both in-store assistance for promotions and self-checkout.

Report Predicts Consumers will Continue Pandemic Shopping Behaviors

In a related finding, according to a survey by Alvarez & Marsal, shopping habits from during the pandemic are not disappearing. Of the 1,500 people surveyed, 85% said they plan to continue or accelerate their shopping behaviors that changed during the COVID-19 pandemic. This includes using curbside pickup for products and home delivery services.

The consumer research group survey also found economic worries are prevalent among consumers. More than half of shoppers (52%) expect their circumstances to stay the same or get worse in the next six months, and 54% said they also expect the economic situation of their families to change for the worse. Another 57% of shoppers plan to have the same or less money in the near future.

Alvarez & Marsal also surveyed what consumers spending plans are for some categories. In 15 of the 18 categories studied, consumers plan to spend either the same or less in the coming months. That included 18% more on fresh food and more on wellness and fitness (5%). However, personal care and fragrance and cosmetics showed planned drops in spending by consumers.

Consumers Still Seeking Out Store Brands

McKinsey has released a “Consumer Sentiment Report” that found consumers are continuing to switch to private brands during the pandemic.

Overall, the study found on average about 40 percent of consumers switched brands at some point during the pandemic. The practice was especially prevalent among younger consumers.

The survey found 35% of millennials have tried a store brand in the past year and 26% of Generation Z did the same since the pandemic began.

When asked why they switched brands, consumers indicated value and prices was their main draw.

Thirty two percent of all consumers surveyed cited price in switching brands, while 30% cited the value they received from the store brand. Another 30% said they switched brands because the store brand was in stock and 17% said they found the private brand to be a better quality than the national brand.

The report also found as consumers begin to return to stores, e-commerce sales also continued to experience robust growth, rising about 30 percent year over year since before the pandemic began. Shoppers are also broadening how they shop. McKinsey found about 60 to 70 percent of consumers did shopping and researching purchases both in store and online with social media has also become a growing influence on purchasing behavior.

Five Favorite Italian Retailers

Dunnhumby’s retail preference index in Italy for 2021 revealed that chains Esselunga, Conad, Coop, Eurospin and Lidl were consumers’ preferred supermarkets.

Esselunga won in four values -- product variety, shopping experience, quality and relationship with the customer. In price perception, it was third after discounters Eurospin and Lidl.

Given the growth of e-commerce, Dunnhumby found that customers want quick and easy shopping, which translates into a flawless website with an effective search function, and a fast and hassle-free checkout.
Grocery Market Forecast to Grow

IGD forecasts the European grocery sector is set to see a 5% growth by 2026. After a modest annual growth rate of 1.1% per year between 2015 and 2019 and the pandemic driven peak of 4.7% in 2020, the analysts expect a normal steady growth in the years ahead.

All channels across Europe are estimated to experience increased sales, with hypermarket and supermarket market shares decreasing and discounter, convenience and online channels gaining shares.

Consumer confidence is still fragile and could easily revert in response to changing conditions in the coming five years, IGD warns.

Survey of Private Label in Greece Reveals Growth

According to a countrywide survey of Focus Bari/YouGov in Greece in July 2021, the number and variety of private label in Greek supermarkets has tremendously increased in the last twenty years.

94% of consumers surveyed regularly buy at least one private label product, almost a doubling of the 50 percent in 2000. When the economic crisis had started in Greece, this percentage had grown to 77 percent in 2010. Looking at product categories, from biscuits to frozen to personal care and paper products, all categories have increased in the last decade. There is a positive opinion among consumers about private label: 71 percent believe that private label products are value for money (vs 64% in 2010).
Belgians Spent More on Food

Last year, Belgian households spent one euro in five on food, according to a study by national statistics agency StatBel. On average, Belgians spent 5,600 euros per year on food, drinks and tobacco, this corresponds to a growth of 12%.

On category level, more was spent on vegetables (+26%), coffee (+23%), fish and shellfish (+15%), meat (+12%), fruit (+10%) and bread (+6%). It comes to no surprise that the extra expenses were compensated by less expenditure in the catering industry, which saw a decrease of fifty percent. Takeaway meals and home deliveries gained in importance last year.

 

Brand Loyalty is Decreasing

According to a study by GfK in Germany, Austria and Switzerland, 83 percent of consumers are changing their shopping behaviour and will continue to do so over the long term. The corona crisis has further strengthened the already prevailing trend towards lower brand loyalty. The brand choice of consumers is increasingly shaped by changing values. Values such as security and sustainability, but also trust, proximity and regionality move into focus, adds the study.

Brands serve less and less as an instrument for self-presentation. Environmental awareness as well as the social and societal responsibility of the company make more and more the difference in the purchase decision.

The GfK study provides another insight: The advancing digitization requires a completely changed customer journey. The path between "first seen" and "immediate purchase" is becoming shorter, as a result, companies may need to reconsider their communication strategy.

Study: Private Brands Perform Well with Vaccinated Shoppers

A new study has focused on what private brand products shoppers vaccinated against COVID-19 are buying.

Numerator, a data market research company, published a ‘Vaccinated Shopper Score’ report, in which products, retailers and brands were identified and ranked by percentage from 230,000 responses from vaccinated shoppers.

Consumers had high marks for store brands from several retailers. Trader Joe’s had two store brands in the Top 5, including Charles Shaw and Trader Ming, which finished first and second overall among grocery private label brands. Also in the Top 5 was Food You Feel Good About from Wegmans in third, Whole Foods Market finished fourth while the Hannaford brand finished 5th. The Fresh Market and Safeway also had products in the top 10.

The Numerator study found retailers with higher Vaccinated Shopper Scores tended to have more private label brands as was demonstrated by Trader Joe’s and Wegmans.

In health and beauty, while national brand skin care products were most likely to be purchased by vaccinated shoppers, private label did have a strong showing as well. BJ Wholesale’s Berkley Jensen line finished first among private label brands in health and beauty while Trader Joe’s, Whole Foods, Costco and Food Lion also had HBC products in the top five among store brands.

CVS and Amazon private label brands both claimed two places in the top 10. Amazon’s Basic Care’s score put it in 9th place while Solimo finished in 10th.

Consumers Switching Brands is Widespread

Inmar Intelligence has found more than eight in 10 consumers purchased a brand other than the one they normally purchase over the past three months.

The research, which was featured in Food Dive, found lower prices of alternative brands influenced more than 65% of shoppers to “often” or “very often” buy other brands while out-of-stocks motivated 51% of consumers to make a switch.

Among shoppers who did switch brands, 4 in 10 said they would repurchase the new brand even if their original choice became available again. Another 36% said they would return to the original brand they intended to purchase.

Dry grocery goods like cookies and cereals were especially vulnerable to consumers switching brands. Nearly 66% of consumers opted for alternative brands in dry grocery goods according to Inmar.

Other categories who were impacted by brand switching included frozen foods with 55%, non-alcoholic beverages with 46% and alcohol at 42%, according to the study.

In addition, Inmar found getting consumers to switch back to their original choices could be difficult, especially when out of stocks make consumers question future availability.

The study could signal a major opportunity for store brands. As supply chain pressures impact the choice of products on the shelves and rising prices from inflation, it is a combination which could make store brand products stand out more to consumers.