In late 2015, Oreo cookies ran a successful promotion tied to the holidays called “Oreo Colorfilled.” The brand cleverly engaged consumers online by allowing them to personalize special holiday-themed packages of Oreos to send to friends. The entire experience took place online from personalization of the cookie packages all the way to credit card capture and check out.
The move was not only a smart way to engage consumers during the holidays but also a foray into online selling of Oreo cookies. After all, earlier in 2015, Mondelez, the maker of Oreo cookies, announced a plan to reach $1 billion in e-commerce by 2020. In February of this year, Mondelez said online sales had grown 35% year over year.
While this growth rate is impressive, happiness is a low base. According to a study that we recently conducted amongst our community, 80% of women said that they do all of their grocery shopping in brick-and-mortar stores. In fact, just 5% say that they do 50% or more of their grocery shopping online. With Amazon Grocery, and other online grocery offerings from Jet.com, Walmart.com and others, this may be poised to change.
Our study also found that 63% of women surveyed were Amazon Prime members. This is up from 52% just one year ago. Interestingly, the study also indicated a drop in warehouse memberships over the last year. Forty-three percent of survey respondents said they have membership at a club warehouse. This is down from 54% last year. Perhaps, bulk grocery shopping is one of the first areas to switch to online purchase?
While 72% of women surveyed said that they go to the supermarket one or more times per week, just 21% shop from online retailers like Amazon, Jet, Drugstore.com or Walmart.com one or more times per week.
Speed and Cost of Shipping
Women surveyed indicated that free shipping and speed of shipping were critical to adoption of buying online. Sixty-three percent surveyed are Amazon Prime members and get free shipping, 34% have use Walmart.com’s two-day free shipping option and 27% have acquired Target’s credit card with free shipping benefit for target.com purchases. Twenty percent of women surveyed said they will buy extra items in order to avoid paying for shipping.
Other Online Buying Behavior
While our study indicates that 80% of women still do 100% of their grocery shopping in-store, there are categories that have made progress with online shopping and could pave the way for increased grocery purchases online.
Close to 40% of women surveyed said that they buy 50% or more of their beauty and grooming products online. Just 37% buy all of their beauty and grooming products in-store.
Heath and wellness products are a bit less likely to be bought solely in-store: 56% and even less for household care products. Just 18% of women buy 50% or more of household care products online.
So, while the online buying behavior numbers are still relatively low for grocery and other household items, cost, convenience and speed of delivery are important elements for shifting spend to online purchase. And with the emphasis that retailers like Amazon, Walmart, Target and Jet have on free shipping and even same-day delivery, spend shift will likely continue to occur. And the online purchase trend with groceries will follow that of pretty much every other category.
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