Grocery Business Hits Digital Tipping
January 30, 2017
Marketing Institute (FMI) and Nielsen have released a preview of its
"Digitally Engaged Food Shopper" analysis at the FMI Midwinter
Conference in Scottsdale, AZ. The introductory set of insights from this
joint, multi-year initiative offer a comprehensive look into the
behaviors, motivations and expectations of the digitally engaged food
shopper. This first perspective offers recommendations on how food
marketers and manufacturers should be preparing their strategies and
managing the organizational change that will be required to engage those
Initial findings from this study show that within the next decade,
online food shopping will reach maturation in the U.S., far faster than
other industries that have come online before. Research also revealed
that the center store is likely to shift online faster than other
departments, suggesting a fundamental evaluation of the role the store
plays in digital food shopping. The research estimates that in the
current climate of technology adoption and evolution, consumer spend on
online grocery shopping could reach $100 billion. To put that into
context, that is the equivalent of 3,900 grocery stores based on store
"While we are more connected than ever to influence what shoppers buy,
the window to influence those moments is narrowing," said Mark Baum,
chief collaboration officer at FMI. "FMI and its members will need to
seize the opportunity to harness new skills and collaborate more
seamlessly than ever before to effectively reach these digitally savvy
food shoppers. We're building the tools to help our members assess where
they are in their connected commerce strategies."
"The grocery business truly is at a digital tipping point, where every
aspect of the shopper's journey will soon be influenced by digital, and
increasingly enabled by digital platforms," said Chris Morley, President
of U.S. Buy at Nielsen. "The need for retailers and manufacturers to
know the differences around how consumers shop online versus in-store is
greater than ever before. Analytics will be key for retailers and
manufacturers to understand the digitally engaged food shopper on a
deeper level. Beyond unified insights that connect the dots across
consumer interaction and platforms, the winning strategy will turn
metrics into action steps towards effective digital engagement."
Key findings of the research:
1.Multi-channel shopping: More
shoppers are buying more of their groceries across channels. In fact,
23% of American households are buying food online today. This upward
trend continues - of those that will buy online, 60% expect to spend
over a quarter of their food dollars online in ten years.
2.Digital Experimentation: Grocery
retailers and manufacturers are meaningfully experimenting with business
models and technologies to find their way online. However, the road to
success has not been paved.
3.Grocery Saturation: Grocery
shopping will reach digital maturity and saturation faster than other
industries before, such as publishing or banking.
4.Center Store Migration: Center
store categories are already migrating online and this migration is
expected to continue.
5.Young & Digital: Younger, newer and
more engaged digital shoppers adopt grocery related digital technologies
more quickly and will hasten the expansion of digital grocery shopping
grocery as the next big retail sector that will be reshaped by digital,
retailers and manufacturers need the tools to realize their connected
commerce readiness in order to meet the needs of the digital food
shopper. An FMI and Nielsen online assessment enables them to assess six
areas that are most important to online grocery shoppers: trust, value,
experience, assortment, convenience and personalization.
The "Digitally Engaged Food Shopper" study is part of a strategic
alliance and multi-year initiative with FMI and Nielsen to uncover
comprehensive insights on current and future digital shopping behaviors
within the food retail marketplace.