New research reveals ‘secrets’ to digital grocery business growth

online grocery shopping

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Want to get more digital grocery customers? It’s simple: just don’t mess with their order.

Customers with a positive online grocery shopping experience are 2.2 times more likely to use the service than those with a less-than-stellar service, according to research released Monday by e-commerce company Mercatus.

Additionally, Mercatus found that customers with a poor shopping experience were 2.6 times less likely to use a service than those with a positive shopping experience. The company found that dissatisfied shoppers were 3.4 times more likely to switch to another grocery retailer and 1.6 times more likely to stop buying groceries online.

“Grocery retailers looking to grow their online business need to improve the overall customer experience,” said Mark Fairhurst, vice president of marketing at Mercatus, in a statement. “By delivering a great experience, the first time and every time, grocery retailers can retain more existing customers and drive positive word-of-mouth publicity that entices others to try their online services.”

But what makes for a positive online grocery shopping experience?

The most important factor is receiving everything in good condition (no grated bread or broken olive oil bottles) and getting everything ordered.

“When it comes to a positive e-grocery experience, minimizing out-of-stocks is important, but delivering products that meet customer expectations is critical,” said David Bishop, partner at analytics and strategy firm Brick Meets Click. “In other words, ordering accurately. The product is great, but it’s better to make sure the ice cream arrives frozen. The rewards for making improvements in the necessary areas of operations can be huge.”

The survey also found that grocery pickup appears to be more attractive to shoppers than delivery.

Mercatus found that nearly half of U.S. households ordered groceries for pickup in the past 12 months, but only one-third received grocery delivery. Additionally, two-thirds of the grocery pickup user base remained active over the past month, compared with only half of delivery customers.

Delivery also has more potential pitfalls for retailers: Studies have found that customers are 30% more likely to have a poor experience with delivery than with pickup.

Financial incentives, such as free or money-backs, have been shown to motivate consumers to try new or different online grocery suppliers.

Mercatus President and CEO Sylvain Perrier in a statement. “Fundamentally, it comes down to understanding who your customers are, understanding what they want, and developing better ways to meet those needs.”

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