Succeeding in the Emerging US Grocery Market

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Case Study

US Grocery reportHow do you pick a peach? Online purchases of shelf-stable, reliable pantry staples like pasta and tomato sauce have become commonplace for many consumers. But with the recent ramped up demand to expand ecommerce into fresh (and frozen) food categories, both retailers and manufacturers are finding themselves in an entirely new game from discovery to fulfilment. Can online product content truly convey freshness? With increasing complex logistics, how can brands make sure that “in-stock” really means available to the shopper? What does it mean to review a peach? Overripe to one person might be just perfect to another. These are just some of the questions manufacturers are grappling with.

In a space where margins are slim and differentiators can be subtle, grocery retailers are turning to “extreme convenience” methods to help win over shoppers and keep them loyal. Online grocery shopping and its fulfillment variations--home delivery, click and collect, meal kits, and now grab and go stores--give the shopper both freedom and flexibility--with speed and convenience ruling the day. Even beyond the digital shelf, ecommerce visibility and availability often translates into in-store sales by winning the battle for consumer mindshare. However, this rapidly-evolving, omnichannel context can be very challenging for manufacturers to manage and measure, especially as each retailer’s model adapts to the market in different ways.

In our analysis, we audited the largest players in the US online grocery market:Amazon, Walmart, Peapod, FreshDirect, and Instacart. We compared fulfillment methods, pricing, and operational capabilities across retailers, as well as portfolio availability, product content options, and consumer engagement features.

Use this analysis as a guide to your ecommerce and omnichannel planning with your retail partners. The differences in shopper experience, site functionality, and offering can vary wildly from store to store. Stay on top of your game and prepare to win the digital shelf now and in the future--whatever innovations may be in store.