Why Many CPG Marketers Are Nervous About Online Grocery

Online grocery shopping has been around for a while. We all know names like Peapod, FreshDirect, Instacart, and AmazonFresh. But now Walmart enters the arena with its Grocery Home Shopping. While still in testing, the concept will likely expand to a near-national footprint in a year or two. In a flash, shopping for groceries on our phones rather than in physical stores will become massively mainstream.

That reality has many CPG marketers lying awake at night. 

Why? Because online grocery requires new skills for how to strategize, plan, and effectively compete in a digital environment. Consulting companies warned marketers years ago to have contingencies in place if a percentage of sales shifted to e-commerce. Few heeded that advice and are now just shy of panic as they try to play catch-up. The good news is that it’s easy to turn your greatest e-commerce fears into e-commerce competencies. For example, here are three big worries you can quickly put aside with some simple changes to your approach.



1. Getting noticed. Brands that rely on unplanned purchases have built their store-based efforts around disruptive display—bigger, louder, and more intrusive than their competition. Unfortunately, there isn’t a direct equivalent to your massive 10-foot-high lobby display online. In grocery e-commerce, shoppers need to find you, and that starts by finding you relevant. Begin by rethinking your online adjacencies, both in traditional product listings and in sponsored content. Be with complementary products that are consumed alongside your brand, but also think out of the box for items that are bought with your brand (like seasonal solutions or items purchased during the same type of trip). 

2. Building share on shelf. In online grocery, “sort” is the new “eye level.” Know how your retailers’ platforms rank listings and make sure your products get to the top, whether people are looking by price, popularity, relevance, or ratings. It may make sense for your brand to have a custom online SKU at a lower price point or higher sales velocity to win those sort categories. As a quick fix, you can also buy display advertising on key pages—especially if you’re buried in the rankings—to give your product additional views. Just as in brick-and-mortar, visibility is key to being competitive.

3. Selling without sensory. It’s hard to make a postage-stamp-sized package feel sexy, velvety smooth, fragrant, or appetizing. However, that’s the reality of online grocery, where sensorial or informational cues are largely absent. Your option? Get creative and develop content to tell your story. Take your item description beyond bland facts to romance your product’s real value. Leverage reviews to highlight that you’re delicious, fun, effective, or perfect for the occasion. Also, think about expanded content—a recipe, a demo video, or other resources offered on the retailer’s platform—to excite the senses and get in the shopper’s cart. Metrics will show you that even small elements like extra product shots, lifestyle photos, or fact boxes (if they’re allowed) can add impact to an otherwise dry online experience. 

If you’re a typical CPG marketer, you may still have some uneasiness about how you’ll succeed in the fast-growing world of online grocery. However, fear is a great motivator. Use it to take stock of your business. You may realize that some of your best go-to strategies for the physical store (like displays and in-store media) won’t translate to the store-less world of e-commerce; they’ll need to be reworked. On the plus side, certain aspects of e-commerce (like subscriptions and the ability to win new audiences) could provide a lot of bottom-line opportunity. Market data indicates that the online grocery shopping train—moving at 10 times the pace of brick-and-mortar—shows no signs of stopping. So grab hold of your emotions and jump on board. It just may be a profitable ride.

1 comment about "Why Many CPG Marketers Are Nervous About Online Grocery".
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  1. Jason Katz from HookLogic, July 15, 2015 at 11:54 p.m.

    CPG Marketers don't fret!  Checkout HookLogic native PLAs.  #PerformanceMarketingforBrands #BrandPower

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