Online Grocery Loyalty Grows, But Success is Costly, According to TABS Analytics
Summary
E-Commerce grocery purchases nearly doubled in the past year, with 66 percent of consumers noting their loyalty to shopping through this channel and Amazon, Walmart and Target making the largest gains in penetration. However, the greater demand is revealing significant structural problems – low margins and unpredictable shipping and fulfillment costs – that will impact the profitability and sustainability of the business model. “The trends in E-Commerce grocery and organics reveal how previously niche markets associated with millennial purchasing patterns are moving closer to mainstream as these individuals enter new stages of life: getting married, having kids and enjoying greater income – all factors in heavy purchasing,” said Dr. Kurt Jetta, executive chairman and founder of TABS Analytics. “Online grocery, however, may become a victim of its own success, as more sales lead to greater losses because of the variable supply chain costs. Utilizing ShopperIQ® and Digital.IQ™, proprietary virtual platforms for brick & mortar and eCommerce, Decision Insight delivers effective strategies that win at retail.
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