Online Grocery Shopping is NOT Failing
I'm angered by the webinar in which a survey of 1,000 consumers has garnered so many headlines that TABS Analytics CEO Dr. Kurt Jetta concluded that "online grocery is failing."
Yes, he found that "just 4.5 percent regularly purchased food and beverages online," and, yes, that's a fraction of $5.32 trillion of overall grocery and foodservice sales; which translates to annual sales of $223,440,000 that in itself is significant.
IRI, at the same time, released the report "Playing to Win in the Rapidly Evolving Omnichannel Ecosystem," estimating that online food and beverage sales accounted for just 0.3 percent of food and beverage retail sales in 2015 and are predicted to account for 2.7 percent in 2020 and 5.5 percent in 2022.
Jetta’s argument is that online grocery isn't a sustainable model. I’m not sure that Instacart, Amazon and grocers that are doing online grocery correctly, and reporting new business through new customers, would agree.
Nor do I.
While it can be argued that no one is producing a profit just yet on online grocery sales, this channel is in its infancy, as is the technology that's being used in-store, in warehouses, in delivery and by consumers to order their foodstuffs. We're in the dawn of online grocery. Just imagine what our lives would be like today if people would've made the same dire predictions and calls to pull the plug on the Palm Pilot; there would be no iPhone -- Imagine that.