The first time the grocery industry was “almost” disrupted by digital ordering was during the first dot-com boom nearly 20 years ago – a brief period in which grocery delivery companies Webvan, Kozmo.com and Streamline were venture capital darlings, yet each of whom suffered from spectacular flameouts when the first internet retail boom collapsed.
Since that time, a generation ago, an online (and now mobile app-based) grocery delivery infrastructure has taken its time to carefully re-assemble and successfully reconstitute itself, all over the world. Last year over $48 billion was spent worldwide on online groceries, a full 4.4% of the total market for all grocery purchases. 5% of US shoppers actually prefer to do their grocery shopping online. That may sound like a relative drop in the bucket, but consider this: the real growth opportunity lies in mobile apps, where companies like Peapod, Instacart, FreshDirect, Whole Foods and others are making exceptional strides.
Shopping app usage grew faster than any other category of apps last year – an impressive 77%, according to Flurry. Shopping apps sessions on iOS and Android devices increased by 174%, with a 220% increase on Android alone.
Millennials Are Flocking to Grocery Delivery Apps
Moreover, the next generation is hungry – and impatient. 43% of Millennials report using some kind of mobile app to grocery shop – either to order groceries for home or office delivery, to help them prepare a list, to search for coupons or to check for store sales ahead of shopping.
It may be some ways off, but the combination of the smartphone’s ubiquity and these expanding, app-centric trends points to a future in which people being born today may never even set foot inside a grocery store.
Before that happens, though, there are important mobile app considerations that any grocery brand ought to be taking into account. One is that shoppers will rapidly turn on you if you don’t provide a first-rate mobile app experience, one that’s fast, smooth and free of errors.
Consumer Research Says….
Our recent mobile commerce consumer study found that two-thirds of consumers (66.23%) said that they had actually deleted shopping apps from their smartphones due to poor app performance, and that the #1 most important consideration in keeping and using a shopping app was that it “loads quickly and is fast, smooth, and responsive”. (You can get all of the results from the survey here).
Even an image that doesn’t load within a grocery app can absolutely kill the purchase of that item, be it diapers, dried fruit or dental floss. 47% of consumers said that they’ll exit an app if the image for the product they want doesn’t show up – a problem which unfortunately happens frequently on slow networks, or in congested or otherwise sub-optimal network conditions. This is the sort of thing that will easily drive customers to a competitor – and these days, now that there’s real money to be made in this space, competition is more intense than ever before.
We’re bullish on the future of app-driven grocery delivery here at Neumob. An informal office poll indicates that this is already a routine, time-saving fact of life for many of our employees. Yet we also know that we didn’t get from the Webvan/Kozmo days on the late 90s to today without strong focus on getting the basics right.
Both in the world of today and for the foreseeable future, one of those core basics is having a mobile app back-end that’s robust enough to keep up with consumers’ demands and expectations, and in providing them with a shopping experience that successfully mitigates the many complexities and unforeseen hiccups of modern mobile networks.