Digital Influences Majority of Grocery Sales: Deloitte Survey
More than half (51 percent) of grocery sales are digitally-influenced, according to a new survey report from Deloitte. “The Grocery Digital Divide: How Consumer Products Companies Can Deliver on the New Digital Imperative” reveals that although the majority of food and beverage purchases are still made in person, online and mobile experiences impact purchase decisions long before consumers arrive in-store.
“People are making decisions about what goes in the grocery cart long before they get to the shelf or even the store," says Barb Renner, vice chairman, Deloitte LLP and U.S. consumer products leader. “In our research, people saw room for improvement from grocers compared to digital experiences they find in other retail categories. Consumer products companies and retailers who create those digital touchpoints have a much better shot at getting the shopper's attention and loyalty before competitors, many of whom aren't even in the game yet."
Grocery’s digital influence takes speed
According to the survey, digital’s overall influence on grocery has nearly doubled year over year, and has been a driver of change on the in-store shopping experience. Since 2013, digital’s in-store influence has dramatically grown 300 percent across all retail sectors, impacting 56 percent of all transactions from 14 percent in that same timeframe. The grocery sector’s digital influence has caught up to other categories – such as health (51 percent), apparel (56 percent), home (58 percent) and auto (59 percent) – though it still lags leaders like electronics (69 percent).
While the influence of digital continues to expand, there is still a divide between what consumers want and what the grocery shopping experience currently offers. The survey found that only 31 percent of grocery shoppers say digital makes grocery shopping easier (compared to 42 percent across other retail categories), presenting a major opportunity for companies to improve the experience.
Consumers want convenience, curation, integration
Digital impacts consumers’ path to purchase through shopper awareness, selection, purchase and loyalty, and in turn is driving the following consumer habits:
- More than three-quarters (77 percent) of consumers surveyed use digital touchpoints such as recipe websites and blogs to drive awareness and find inspiration.
- Eighty percent of respondents have used a digital device to browse or research grocery products, tapping sources like manufacturer and grocery retailer websites.
- Nearly three in 10 (29 percent) of respondents try products based on online recommendations and reviews, seeking answers from blogs and social media posts alongside online product reviews and loyalty apps.
Consumers who embrace digital options – such as on-demand local delivery, in-store coupons and instant rebates or mobile checkout – before or during a shopping experience end up converting 9 percent more often than those who shy away from digital leading up to their purchase decision, according to the survey.
Mobile’s in-store influence has increased from 5 percent in 2013 to 37 percent in 2016, and grocers’ mobile apps lead over consumer product brands’ apps, with 41 percent of survey respondents turning to grocery retailers’ apps compared to 27 percent who use a consumer product company’s app. Roughly one-third of respondents said they use a smartphone to help choose a brand during a shopping trip.
"Digital is expected to play an even bigger role in delivering the experiences shoppers' desire," says Rich Nanda, principal, Deloitte Consulting LLP and U.S. consumer products corporate strategy and growth leader. "However, many consumer products companies and their retail partners have yet to take full advantage of the opportunity, potentially leaving money on the table."
Delivering on the new digital imperative
To expand digital, drive brand engagement and capitalize on today’s omnichannel marketplace, consumer product companies can alter their operations to become faster and more connected in the digital world. These companies have the opportunity to integrate and coordinate across their physical stores to align with the digital platform where consumers can shop any time, blurring the lines between physical marketing, consumer and shopper, and online and offline purchases. Digital’s growing influence can help grocery retailers and consumer product companies increase consumer spend, say Deloitte experts, but only if they quickly adapt.