Some say it’s still a niche while others call it a big trend, but no matter the perspective, online retail is here and experts say grocers as well as produce suppliers who ignore it will have regrets.
The Midwest Produce Conference & Expo is highlighting online grocery retailing as the topic for this year’s general session. The show, produced by The Packer newspaper and Produce Retailer magazine, is set for Aug. 19-21 at the Hyatt Regency Chicago.
Greg Johnson, editor of The Packer, is scheduled to moderate a discussion about the effect online sales are having on the produce supply chain.
There is a question-and-answer session after the panel, which includes three presenters: Bill Bishop, retail researcher and chief architect of Brick Meets Click, Drew Schwartzhoff, director of marketing and sourcing for C.H. Robinson, and Tony Stallone, vice president of online retailer PeaPod.
“We wanted to get someone like Bill to give an overview, and then have an example from both a produce company perspective and a retailer,” Johnson said. “Drew and Tony fit those roles perfectly.”
The presenters say online retail offers new opportunities for traditional businesses.
“Internet food sales are growing by double digits,” Stallone said. “Traditional retailers have recognized they need to get in there, but many continue brick-and-mortar thinking and that doesn’t work online.”
Results from a survey by Brick Meets Click and the National Grocers Association support Stallone’s double-digit assessment.
Data showed 13% of shoppers questioned bought grocery products online in the 30 days before the survey. The online survey of 22,000 grocery shoppers included consumers from seven different banners on the East and West coasts and in the Midwest.
“Online is still a niche. Over 90% of food sales are still in-store and will be for some time,” Bishop said.
“I believe the biggest opportunity for retailers and suppliers is to use digital (tools) to increase engagement in the store and improve shoppers’ in-store experience.”
Stallone said PeaPod’s growth since its launch in 1999 — including a recent expansion of services in Chicago — is proof consumers want to buy not just center-store groceries, but fresh produce, online.
“Produce is our single-biggest category in Chicago, and it is No. 1 or No. 2 in all of our other markets,” Stallone said. “We’ve got five temperature zones just for produce at our distribution centers so consumers and suppliers know we keep the cold chain intact.”
Stallone also said retailers and suppliers shouldn’t limit their online thinking to sales, suggesting that companies increase use of quick-response codes to link shoppers to nutrition information and recipes and to boost brand recognition in the produce aisle.
C.H. Robinson’s Schwartzhoff also said digital tools can enhance consumers’ experiences in traditional and online shopping scenarios.
“As suppliers, it’s important to know how to effectively collaborate with retailers to utilize the online medium from making online produce purchases, encouraging shoppers to go to their store or enhancing consumers experience with fresh produce,” Schwartzhoff said.
“Technology will continue to provide retailers with opportunities to engage with their customers.”