The pandemic required Canadians to adopt new ways of shopping across all types of retail, and when it came to grocery, we saw no exception. During the early days of the pandemic with grocery store queues, product shortages, and safety concerns, one in four Canadians (25%) pivoted to online grocery for the first time. The uptick in online grocery shopping is quite astonishing given that grocery stores were one of the only types of retail and “activities” outside of the house open to Canadians during many months of the pandemic. In Deloitte Canada’s latest report series The future of food: a Canadian perspective,we explored Canadians’ perceived benefits of online grocery shopping, but also the pain points and how nimble retailers are responding and adapting to these changes and planning for a digital future in grocery.
Over the last year and a half, Canadians tried a variety of food-shopping options for the first time, including curbside pickup (25%), online grocery delivery (15%), third-party food-delivery services such as Uber Eats (15%) and meal-kit delivery services (10%). The reasons provided for shopping for food online reflect a world of stay-at-home orders, time pressures, and of course, virus concerns. More than two-thirds (68%) of Canadians who shopped online for food cited the benefits of home delivery, 59% liked the convenience of shopping from home, and 47% said it saved them time. This trend has been supported by retailers themselves, from large grocery chains to neighbourhood stores and even local farmers, whose expansions or pivots to e-commerce and delivery have greatly increased online-shopping options for the customer and created an exciting space for further growth.
Even as we look post-pandemic, online grocery shopping is here to stay. Of those who have shifted to online food shopping during the pandemic, 69% plan to continue using delivery services and 65% plan on continuing meal-kit deliveries in the next 12 months. This also doesn’t include later adopters who will eventually turn to online grocery as the technology and convenience continue to improve. Deloitte estimates that online grocery shopping will expand by about 32% from pre pandemic levels over the next year. In turn, food retailers are investing in strengthening their digital strategies, improving their platforms, and expanding the range of products available to buy online. They’re also providing consumers with targeted offers and a range of convenient options for obtaining their purchases, from home delivery to click-and-collect. Some retailers have also opted to use stores as micro-fulfillment centres, enabling quicker-than-ever delivery speeds.
However, despite all the benefits and technological advancements in online grocery shopping, Canadians still seem less than enthralled with their overall online experience: only 23% overall said they’ve been satisfied with their online pickup or delivery services. Over the coming months, greater expectations will be placed on grocers to provide a seamless, curated shopping experience both in-store and online by leveraging the latest technologies. Companies that move beyond two-dimensional scrolling to a three-dimensional virtual experience will also elicit more shoppers.
For example, a small-scale speciality food retailer in Toronto has embraced omnichannel innovation by partnering with a grocery delivery service to launch the first 3D virtual grocery shopping portal in Canada. Customers will be able to “walk” through the aisles of the grocery store virtually and purchase their food for home delivery all from the comfort of their home. This is only one example of the creative and innovative work that is being done in the grocery space.
Other technology advancements will be those that reduce the time it takes to shop online. While many of those surveyed said that online grocery shopping was convenient, it can still be time consuming, or more time consuming than it needs to be. Food retailers that focus on technology advancements that help make the online process more intuitive, like filtering out excess “noise” and products that don’t match the customer’s lifestyle, like non-vegan products, gluten intolerances, or any other dietary requirements, will provide clients with a curated assortment of items so they can quickly find what they want and facilitate one-stop shopping.
We are in the middle of a great transformation in online grocery shopping. The potential for saving time, higher convenience, and better customization of product recommendations is promising. With targeted improvements to the technology, we predict online grocery shopping will continue to grow and provide very interesting opportunities for food retailers.