What motivates digital impulse purchases for produce
Historically, about 40% of produce sales and unit volume at brick-and-mortar grocery stores have come from impulse buys — purchases shoppers didn’t intend to make when they walked inside those doors.
Yet global tech and marketing innovations have pushed shopping, including impulse purchases, from a traditional in-store retail environment into different online channels — e-commerce, social commerce and mobile commerce.
And grocery categories aren’t equal in their online performance.
“Digital has not necessarily given produce the same bump as it has the center-store,” said Joe Watson, vice president of retail, foodservice and wholesale at International Fresh Produce Association. He introduced the 40% statistic at a conference. “One advantage of shopping online is you know the value of it in the cart, and when you’re at the checkout, you know if you’re $30 over what you planned, and you can take stuff out.”
That’s a key consideration for budget-conscious shoppers feeling the pinch of inflation.
Still, grocery e-commerce dropped in the first part of 2023.
The online grocery market in March posted $8 billion in total sales, down 7.6% compared to last year, according to Brick Meets Click. All three areas of delivery, pickup and ship-to-home declined year-on-year.
“Growth in the second quarter of 2023 will require firing on all cylinders,” Watson said in a March U.S. Market Watch produce report by Anne-Marie Roerink, president of 210 Analytics. “The March report demonstrates that there are pockets of growth when zeroing in on certain meal occasions, commodities, holiday periods, private brands.”
Especially for online grocery shoppers, personalization is key to impulse purchases and increasing that overall basket size, said Becky Eldredge, vice president of commercial, customer media and loyalty at 84.51°, a retail science insights and data company owned by the The Kroger Co., based in Cincinnati.
Eldredge’s studies show that 59% of customers are more likely to purchase a certain brand or shop a certain store if they're receiving personalized content for that brand or for that store compared to those not receiving that personal personalized content.
“We've got the science to help build your basket based on what you've bought in the past. And so, you get in there and it's not as if you're starting from scratch,” Eldredge said about e-commerce. “Rather, we're leveraging that personalization science in order to remember or recall all of the things that you frequently are purchasing. That helps to save you time in building that overall basket.”
This Build Your Cart feature has shown to drive 20% to 40% of incremental sales versus a nonpersonalized experience within the overall basket. Saving shoppers time and reducing their cognitive load is part of the overall value of a shopping experience.
“And we also use that feature to recommend additional items that customers want to consider within their basket as well,” Eldredge said.
People committed to the convenience of buying their groceries online may make unplanned purchases for different reasons than they would in-store.
“Impulse buys are motivated by the senses, and that’s so hard to replicate online,” Roerink said, pinpointing visuals, aroma and store ambiance, like great lighting and music. “Price becomes secondary. It’s totally about that product, that smell, touch.”
The main sense you can connect with the consumer online is visual, she said. That’s why great photography is critical.
But there’s also an information advantage.
“It’s a great tool to understand the customer’s psyche on how they make their decisions,” Roerink said. “It varies vastly among retailers.”
Also: live-streaming video with shoppable links creates a time scarcity and makes shopping more social, which increases impulse buys.
Firework created a livestreaming holiday cooking tutorial for The Fresh Market, headquartered in Greensboro, N.C., and more than 400,000 customers went to the retailer’s homepage to order the ingredients after attending the event, said Jason Holland, Firework chief business officer.
Packaged produce advertisers use an Instacart advertising toolkit that includes sponsored product, display, shoppable video, promotions and impulse ads. This means produce brands can now amplify the full product set, including packaged and random weight produce.
For example, with impulse ads, Instacart is introducing a digital-first approach to last-minute buys during the checkout experience, including fresh produce brands. Bowery Farming, Love Beets, NatureSweet and Zespri Kiwifruit now have access to new impulse-dedicated placements that give people fresher, healthier choices as they’re completing their checkout.
"It's great to see a new and healthy take on impulse purchases at the digital checkout. When people search for fresh produce on Instacart, we want to make sure NatureSweet shows up," Travis Laveault, NatureSweet senior digital manager said in a news release.
Jordan Wise, produce manager at Wegmans in Brooklyn, N.Y., learned that less-familiar tropical fruit sells much better when the item is skinned, seeded, washed and cut. When the store added certain fruit in fresh-cut fashion, weekly sales quadrupled from $5,000 to $20,000, he said.
“E-commerce and social media have a big impact on what’s popular,” Wise said, estimating that about 80% of store’s sales are through Instacart. “We really have to follow trends. Instacart helps because we can see what people are buying.”
There are some common threads on what can help increase those digital impulse buys.
To grab those last-minute sales online, retailers are cross-merchandising online in a similar way they do in-store, with tie-ins. For instance, a digital storefront will group together tomatoes, basil, pasta, sauce and Parmesan cheese.
“And if a retailer doesn’t do something like that, they’re missing an opportunity for an impulse buy: meal solution add-ons to their digital storefronts,” Roerink said. “The biggest thing retailers are doing is making sure they turn their websites into meal solutions.”
Critical information points for unplanned purchase decisions include website quality, perceived product quality, product reviews and product information provided by the retailer.
Personalized marketing can lower the information overload that shoppers feel with the digitization of their lives, according to a November 2022 article, “Consequences of personalized product recommendations and price promotions in online grocery shopping,” in the Journal of Retailing and Consumer Services.
Two main ways to accomplish this strategy is through personalized product recommendations and personalized price promotions, although the latter is debated for its discrimination implications.
The Fresh Market leverages Instacart’s algorithm to suggest items based on what the shopper is purchasing or has purchased in the past, said Gerrick Polinsky, The Fresh Market's senior e-commerce manager of merchandising and operations.
“And we can also leverage our own recommendations, like register stands at gas stations and Target, where the gum and candy is, after you click to check out online,” Polinsky said. “It says something like, ‘Got everything you need?' That page gets me every time, and I end up buying one or two more things."
Related: The Fresh Market's Gerrick Polinsky on training personal shoppers
