It’s no secret: Online is where the shoppers are at. As Amazon makes strides into the food scene through its Whole Foods acquisition, it is little wonder UK retailers are concerned. While the digital-first behemoth seems to attract business with ease, supermarkets are struggling to convert brick-and-mortar shoppers into e-commerce customers.
But what does this mean in the world of fast-moving consumer goods?
Convenience has become a number-one consideration in the connected world: 27% of consumers are searching for products that make their lives cheaper, simpler, quicker.
This stretches to how we shop and is category-agnostic. In 2017, UK online sales of FMCG goods was £7 billion – roughly 7% of total sales in the local market – with the figure due to rise to £10 billion by 2020, according to Nielsen. So, if supermarkets aren’t able to capture shopper intent online, they risk losing significant revenues.
But while UK consumers happily adopt convenience-led technologies such as self-service checkouts, they are reluctant to accept other offerings like in-store WiFi, QR codes, mobile lists or social media; which leaves supermarkets with a tricky question to answer: What can they do to attract shoppers online?
Here are five areas retailers must focus on in their efforts to drive e-commerce sales.
First-and-foremost, consumers want convenience. So, supermarkets should highlight the ease on offer. Emerging technologies allow shoppers to buy through mobile, scan for goods, even redeem vouchers – but shoppers remain reluctant to do so, arguably because they haven’t yet been shown how simple it actually is.
Just 20% of shoppers said they would log-in to store WiFi. However, if they were made aware of the benefits on offer, this could encourage a change in attitude.
According to Nielsen, only 9% of supermarket shoppers considered social media as a useful aid in purchasing decisions. This is in stark contrast to recent research by IBM showing 75% of general shoppers relied on social input when choosing between products.
Supermarkets must better consider how to leverage social media to attract customers online, considering their cross-channel strategy. Influencer partnerships can be one means of generating a following, but more important is ensuring that the following converts into online activity.
The paper list is a bane of shopping. However, UK consumers still shy away from mobile options. 80% of adults have a smartphone, whereas just 21% are willing to dabble in an online or mobile list.
Globally, 36% of shoppers use mobile lists. So, there’s no reason UK retailers can’t up their game. Moreover, if they find the right incentive – electronic coupons, instant savings – to encourage consumers to interact via their smartphones, they have an open channel to attract and retain customers.
The greatest challenge to overcome is personal preference: almost two-thirds of consumers simply prefer the brick-and-mortar experience rather than buying online. Whether it’s because they can pick their fresh goods, discover deals, or it’s merely what they’re used to – it’s difficult to change the habit of a lifetime.
But this is a generational preference. Millennials are rapidly becoming the segment of society with the highest spending power; they’re also a mobile-first generation who are more than comfortable shopping online.
Moreover, with clear personal preferences around sustainability and less plastic consumption, millennials are open to engaging initiatives. So, supermarkets have an ‘in’ if they can improve the digital experience in a way that aligns with the interests of the incoming generation.
While larger stores stock the majority of items; smaller, urban supermarkets can have limited ranges or fewer products altogether. Alas, planning a meal, only to find an item lacking on the shelves is a pain that many consumers still experience.
If supermarkets could find a means of providing real-time product availability to consumers, 89% of millennials admitted this would influence the store at which they chose to shop.
With smart data systems, enhanced product cataloguing and increased automation, it may not be long until retailers have such capability. It could even be an essential play in attracting an online audience.
There are no quick-wins in business; but as US retailer Walmart proved with its 33% growth in online sales, if you invest wisely, you can still find significant gains. It’s a matter of turning the focus to your shopper’s core preferences – in the UK, that’s convenience – and doubling-down on efforts when you find a strategy that’s paying off.
After 12 years’ experience within the industry predominantly focusing on Operations and Supply Chain, founding The Sterling Choice has provided me with the opportunity to take a step ba...