The online grocery industry has proven to be one of the more difficult for retailers to conquer, both in the US and Europe.
With the explosion of social media and new technologies, consumers are empowered to research and share their opinion on products and brands like never before. Combined with the increase in competition, changing consumer behaviour, and a volatile economy, growing grocery sales online is both a major challenge and an opportunity for supermarkets.
Online grocery is actually one of the few areas where the UK leads the traditionally more pioneering US, with online sales currently representing 5 percent of total sales, in comparison to 1.9 percent in the US. However, these figures are expected to increase substantially in the next five years, as companies make shopping for food online more convenient and accessible than ever before.
Convenience is the number one reason why consumers shop online for groceries. The extensive choice available in supermarkets can be both overwhelming and time-consuming to navigate, making the ability to quickly filter down the vast array of products and brands online an attractive alternative. Additionally, changes in society like women’s increased purchasing power, represent a great opportunity for retailers to invest in solutions enabling them to provide a more convenient, ideally frictionless, shopping experience, both online and in-store
The desire for a quick and pain-free experience means the consumer decision journey is quite different in comparison to other purchases, and that contrast is reflected in how consumers engage with grocery websites. According to a variety of brands and retailers in the Bazaarvoice network, only one to 10 percent of total site visits access a product detail page – a very low number when you consider the online retail average is 35 percent.
For Dukanbazaar and our clients, it is important to understand how consumer-generated content (CGC) can impact different grocery shoppers according to their requirements.
The minority segment of customers who do access products pages are generally looking for more information about the product before adding it to their basket. Often this happens when consumers are:
Experimenting with a different brand of a product they buy regularly
Considering a type of product they have not purchased before
Ratings & Reviews lead to this discovery and allow customers to hear from other shoppers about their experience with a product prior to purchase. In the instance of low-consideration purchases, this content helps consumers determine if the value brand is worth it. The opposite holds true with luxury products, as consumer-generated content may help justify the cost of high-consideration items like automobiles or appliances.
White label and lesser known brands do not have the marketing budget or brand equity of established brands; this increases the significance of social validation to gain trust in these brands and their products. Once a customer has tried and tested a product, it is more likely to be added to their favourites and reordered, increasing the lifetime value of that customer.
Dukanbazaar industry benchmarks reflect that this segment of users are highly influenced by CGC – 45 percent read reviews and they have an uplift of conversion of 113 percent, in comparison to those who did not read reviews. This can increase revenue per visit by 84 percent.
This research behaviour is not just limited to online shopping either. Thirty-five percent of grocery page views are accessed on mobile devices, suggesting some customers are doing research whilst in store. This trend of researching online and purchasing offline, is further detailed in our recent ROBO study. Online conversion is frequently the main benefit of a successful CGC programme, however for many online food shopping clients this is just the starting point. There is measurable value from using this strategic asset across multiple channels and customer touchpoints, where shoppers are looking for social validation. So visit
http://dukanbazaar.com to find more.