A new survey by Spryker of 2,500 UK consumers found that 60% of the order at least some groceries online. However, 16% of those surveyed ordered all or most of the groceries online.
The UK has an established online grocery market. However, this sector still has potential expansion opportunities, valued at £200 billion.
82% of UK shoppers say they would shop more online for food if the experience were better. However, 28% also plan to shop online within the next two years. Further, home delivery is cited as the preferred channel (23%) over pickup in-store (6.6%).
Boris Lokschin (Co-Founder and CEO of Spryker) comments, “With the cost-of-living crisis shrinking consumer budgets,”
According to our research, low-cost supermarket shoppers are desperate for online services. So this could be a huge opportunity for these retailers to offer online ordering and home delivery.
“The UK’s online grocery consumers have high expectations and are hungry for new experiences. Providers who can provide a better product experience, more variety, and a higher level of customer service will win over these customers.
They will have to ensure that existing services in-store are still available as the focus shifts from online to online. Retailers can solve this by investing in technology infrastructure that seamlessly connects on- and offline channels. Customers will continue to return in-person and digitally to solve the problem.
77% of respondents recognized Uber Eats as a brand, placing it on par with Just Eat. Deliveroo came in third with 74%.
Despite significant investment in the UK, 63% of consumers did not recognize Amazon as an online grocery supplier.
Gorillas and Getir, two of the newer challenger brands, were recognized by 17% and 21%, respectively. Other on-demand providers (Zapp GoPuff Jiffy, Jiffy, Weezy, etc.) fell between 5% to 15%.
Research revealed that rural areas have additional growth potential for online grocery sellers.
Online shoppers are more likely to be located in areas with many local grocery stores. As a result, rural residents were less likely than those who lived near a supermarket to shop online.
This is not due to a shortage of demand. Instead, there are just fewer online grocery stores in rural areas and smaller towns.
However, there is still a strong demand for e-food services, as 17% of rural respondents often shop online.
Lokschin comments, “The e-food industry has seen tremendous growth over the last three years, but there is still a lot of potentials for retailers to explore.”
Online grocery shopping is currently driven by the 35-44-year olds who spend more than a third of their grocery money online. However, older consumers are becoming more online-savvy. As a result, most shoppers shopping online are over 55-years old.
Composable commerce is a key tool for retailers seeking to attract new customers. Providers can make better digital experiences by choosing the best services and quickly integrating them.
22% of UK online shoppers reported significant cuts in their spending at health food stores. Another 19.3% reported spending less on open-air and local farms.
However, only 7% of respondents reported a reduction in their grocery spending, while 10% said they bought significantly less from low-cost providers like Aldi and Lidl.