Another strategy is to hire outside delivery assistance from companies like Instacart. Schnucks, which operates about 100 stores in
five Midwest states, is placing the emphasis on one-day delivery. The
chain is partnering with Instacart for online ordering and delivery
along with other retailers in the St. Louis market including Straub’s,
Shop ’n Save, Whole Foods, Costco and Petco. Beginning in February,
customers began accessing the service at Schnucksdelivers.com.
With a minimum purchase of $35, Schnucks Delivers charges
$5.99 for two-hour delivery or $9.99 for one-hour delivery. For orders
under $35, two-hour delivery costs $7.99. Customers also can pay an
annual fee of $149 for unlimited deliveries, or $14.99 a month.
However, some question the long-term value of outside firms like
Instacart. “The industry may not need a middleman now that retailers decided it is time to control their own destiny in the space beyond
Amazon,” says Shaheen. “You’re going to see retailers realize they
don’t need another brand between them and their shoppers. Once that
happens the need for Instacart will decrease drastically. You will have
a few delivery players in specific markets sticking around for small
regional players who don’t have the means to do this on their own.”
THE LONG GAME
Chasing Amazon in the online grocery space is a popular activity,
but opinions are mixed on whether it is worth the time. Some say
most retailers do not have to out-invest or beat Amazon—just outperform their weakest competitors. Several factors are accelerating
Amazon’s impact on the grocery business. At the forefront is the nor-malization of the online transaction.
“Shopping is largely female dominated and initially they were hesitant, but all that’s changed,” says Sargent. “Mobile technology and the
fashion business led the way for the female demographic to be more
disposed to online shopping. Companies like Target and Kroger, that
Five Things Customers Want
1. Easy-to-find Products and Deals
In 2016, 50 percent of all shoppers who never made a second online grocery order say it was because they could not
easily find the products they were looking for. Forty-five percent say it was because they could not find as many deals
online as in store.
2. Personalized Offers, Sales and Product
Suggestions: From the homepage shoppers should feel
that the experience has been tailored specifically to them.
They should see their previous orders, have access to their
most frequently purchased items and be shown products
and specials that are relevant based on their shopping history. Personalization should extend to search results, the
products displayed at the top of each department, product recommendations in the cart, the weekly ad and digital
3. A Digital Weekly Ad: Build weekly ads for digital and connect it with e-commerce. Shopper interactions
and expectations are different online, and weekly ad needs
to reflect that. Rather than a PDF of a print version, design
weekly ads to capitalize on all that digital has to offer—
personalization, omni-channel support, measurability and
interactivity—and ensure it can support exciting content
like complex offers, videos, recipes, collections and more.
Connect it to e-commerce so that shoppers can easily take
advantage of savings via an online order.
4. Digital Coupons: Twenty-nine percent of shoppers
say they would enjoy browsing and clipping digital coupons
online in 2017. Integrate digital coupons with e-commerce
so that coupons are found and redeemed. Allow shoppers
to easily find, clip and redeem coupons related to products
they are already buying or are likely to buy while they shop
online. Do this by connecting coupons to product pages
and the catalogue so that as coupons are clipped, the cart
total adjusts in real time, allowing shoppers to more accurately budget their online shop and never miss another deal
5. “Fast Food”: Twenty-five percent of shoppers say
they would switch grocers for one-day delivery, and 24 percent would switch grocers for same-day delivery. Twenty-four percent of shoppers say they are unlikely to shop online
in 2017 because they do not want to wait for their groceries.
Make the pick-up and delivery part of the online shop feel
easy and fast for shoppers by giving them options for both
fulfillment-type (curbside pick-up versus same-day delivery
versus next-day delivery) and pick-up/delivery times. Explore
external partnerships and “asset-light” delivery integration
options to make delivery possible.
Source: The 2017 Grocery eCommerce Forecast: The Time is Now for
eGrocery, Unata, Brick Meets Click.