OPINION: EDITOR'S NOTE
While I was on a recent visit to a supermarket in Austin, Texas, a man walked into the store café with a beautiful golden retriever. As I was standing nearby, waiting for my latte to be ready, the man placed his order while the retriever was in a sitting position next to him. The dog was staring at the woman making coffee behind the counter. It was clear to me that the dog was well acquainted with this barista.
A few minutes later, the coffee-bearing canine whisperer handed the dog’s owner a “puppuccino,” a small cup of whipped cream, which the dog lapped up quickly. The expression on the dog’s face made me smile as he pranced out into the sunny parking lot.
The scene got me thinking about grocery e-commerce and the recent news about ultra-fast delivery startups Jokr, Fridge No More and Buyk shutting down.
Jokr specifically ceased operations in June, just weeks after it revealed that it was working toward becoming the first carbon-negative grocery delivery platform. The company had rolled out its own retail media platform and mobile app in the spring.
In an email statement to vendors that was shared in part by Bloomberg, Jokr said, “While we have made tremendous developments in building a sustainable operation in the U.S. in recent months, we continue to face a tumultuous, ever-changing macro-environment.”
That macro-environment is certainly tough. After all, how can you compete with a barista who knows your dog by name the minute he walks into the room?
Today’s pandemic-fatigued and inflation-stressed grocery shoppers are seeking value more than ever before, but how they define value is becoming more diversified. Some shoppers are finding value in skipping the trip to the store via e-commerce, while many others are finding value in the experience of going to the store, especially if they get to take their dog and buy him a treat. This experience in particular isn’t easily replicated online, whether they pay for same-day, two-hour, one-hour, 30-minute or 15-minute delivery. Then there are all of the shoppers who balk at paying a premium for e-commerce, even if it’s ultra-fast.
According to a new report from digital commerce solutions company Stor.ai, fewer than 2% of U.S. adults say that they’re “very likely” to shell out premium fees for ultra-fast delivery. According to the survey, around half of consumers are hybrid shoppers, while 37.2% shop entirely in store and only 2.6% report that they use online services for all of their grocery shopping. The research also found that 58.2% of U.S. consumers agree that there’s value in keeping local grocers functioning.
Meanwhile, retailers are spending massive amounts of capital on the bet that Americans will buy their groceries mostly online in the future. So far, though, it seems as though we are far from becoming a nation of online grocery shoppers. E-grocery sales increased 1.7% to $7.1 billion in May compared with last year, according to Brick Meets Click and Mercatus. Post-COVID, many shoppers seem to be just fine with making the trip to the store, whether to save money on delivery fees, get out of the house or say hello to the doggie-loving barista at the café.
Nobody knows how the future of grocery will shake out, but what I do know is that the in-store experience will always be important. Grocers are focused on future-proofing their physical stores with technology, but can a robot recognize your dog and make him a puppuccino? Delivering a better and distinctive experience for customers might be just as simple as that.