Retail Intelligence: US online grocery shopping set to go mainstream

January 13, 2014
Profitero
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Research by the Wall Street Journal reveals that US online grocery shopping looks set to finally enter the mainstream as online grocery shopping becomes increasingly price-competitive. A buyer’s test involving 14 basic items across six cities reveals that online groceries were actually cheaper or roughly equivalent to in-store prices.

Online grocery shopping in the US has always remained a niche business due to limited selections and high costs – until now. An experiment by the Wall Street Journal across six cities reveals that online grocery shopping is starting to make sense as more grocers (Amazon, Walmart, Whole Foods to name but a few) undertake trials to expand online, making it more price-competitive for shoppers.

The Wall Street Journal’s experiment was based on 14 basic grocery items bought in both online stores and at mid-priced supermarkets. The findings reveal that in a few of these cities, online groceries were actually cheaper or roughly equivalent to going to the supermarket – even with their delivery charges.

“The biggest surprise from our experiment is that, in a few cities, online groceries, even with their delivery charges, were actually cheaper than or roughly equivalent to going to the supermarket. For a Walmart delivery in San Francisco, my test basket of groceries cost about 10% less than at the Safeway supermarket where I usually shop.”

The research also highlights the unique benefit of buying groceries online: price comparison across online stores, described by the Journal as a ‘superpower’:

“Online groceries gave me a new superpower: price comparison across stores. At my local supermarket, I am used to comparing the price of canned tomatoes across brands on the shelf. Online, I can quickly see Safeway charges $6.59 for a can of Cento San Marzanos, while Walmart.com stocks it for $3.48.”

US online grocery shopping is predicted to triple in value in the next 10 years to account for 11% of total US grocery spending by 2023 – up from its current 3.3%. Ensuring you are price competitive online will inevitably drive the channel shift, with The Wall Street Journal concluding that ‘the days are numbered where people who feel comfortable doing their shopping on a phone app still buy their groceries at a supermarket’.

Discover how Profitero delivers critical online pricing intelligence to more than 40 global retailers, including three of the top five UK supermarkets with an eCommerce presence. Email us at sales@profitero.com or visit www.profitero.com to find out how Profitero can help you stay price competitive across all channels.

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About Profitero

Profitero is the leading global provider of online competitor pricing data. We provide both bricks & mortar and online retailers with their competitors’ prices, promotions and full product assortment information. Profitero’s accurate and timely competitor intelligence enables our customers to make better informed and more profitable pricing decisions, helping them to increase sales as well as margins.

More than 40 global retailers, including Staples, Sam’s Club, Tesco, Waitrose and Ocado, rely on Profitero Price Intelligence to:

  • Benchmark competitor prices
  • Manage their prices and promotions
  • Attract price sensitive shoppers
  • Negotiate better with suppliers.

Our pricing data can be seamlessly integrated into price optimization solutions such as Blue Yonder, Revionics and IBM DemandTec, to deliver more accurate and effective price optimization. Profitero is also the preferred supplier of online competitor pricing data to Nielsen’s retail customers across more than 100 countries.

To discover how Profitero can help make your pricing smarter, contact us at sales@profitero.com or visit www.profitero.com.

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