Nielsen Homescan data shows that, compared with all online shopping, the typical click and collect shopping basket is heavy on edibles like meat, produce, dairy and frozen foods. Dry grocery is important too, says the report, as it is included in 50% of click and collect shopping trips.
In order to support the growth of e-commerce, and address the unique challenges of online food shopping, Nielsen and FMI companies are pioneering new ways of getting orders into their customers' hands. At the current rate of growth, Nielsen and the Food Marketing Institute (FMI) estimate that Americans’ total online grocery spending will reach $100 billion between 2021 and 2023.
In order to support this growth, and address the unique challenges of online food shopping, companies are pioneering new ways of getting orders into their customers’ hands. Home delivery is currently Americans’ preferred fulfillment option, with 69% of households saying that it appeals to them, says the Nielsen and FMI survey. This isn’t surprising, given that delivery has been around the longest of all digitally enabled food options. But the emerging “click and collect” model (pickup from your local store after placing an order online) is one to watch, says the report. In fact, Millennials, who can be a leading indicator of future trends, prefer click and collect over home delivery.
Click and Collect Gaining Appeal (of online delivery services)
Index of Millennials to All
Groceries delivered directly
Specify day/time for delivery
Same day delivery
Few hours delivery
Pick up inside local store
Pick up at store via curbside
Subscription for when/where delivered
Source: Food Marketing Institute Survey, February 2018
So, as Millennials’ incomes and household sizes grow, are all retailers ready to offer these consumers’ their preferred fulfillment model, asks the study. According to the Nielsen/ FMI survey of brick-and-mortar FMCG retailers, one-third of retailers surveyed indicated that they are not equipped to support click and collect, and 36% don’t have a website or mobile app that enables online purchases.
Retailers can address this gap and take advantage of the demand for click and collect by focusing on three areas: who to target, what to offer them and where to reach them, says the report.
Today, four out of 10 online shoppers in the U.S. are using click and collect, according to Nielsen Homescan data. On average, they make a pickup trip every six months (this low frequency makes sense, given that it’s a newer option, notes the report) and spend $58 per trip. Click and collect attracts a broader shopper base than online shopping in general, and it skews highest among middle-income families and consumers aged 18-44.
Click and Collect By The Numbers
Percent of Respondents
Online shopping households
Online dollar spend
Online shopping trips
Source: Nielsen Homescan, 52 Weeks Ending March 2018
Mass merchandisers are today’s most popular click and collect retailers, with the highest combination of online shopper penetration and sales dollars, says the report. As grocers and other retailers get in the click and collect game, they should consider implementing the model at stores in metropolitan areas. Nielsen Spectra mapping reveals that those locations benefit from high concentrations of nearby click and collect shoppers and are likely to deliver the best return on investment.
The report concludes by suggesting that, as digital technology becomes a pervasive part of food and beverage shopping, click and collect is one of many models retailers should explore to build a more seamless online-offline experience. The companies who succeed will be those that identify the right customers and locations for click and collect fulfillment.
For additional information from the Nielsen report, please visit here.