Monday, 25 March 2019 19:33

Australians gravitate towards online grocery shopping: research

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More than five million Australian grocery buyers — or 31% of the nation's grocery buyers — would consider buying groceries online in the next year, up over 800,000 from a year ago, according to newly published research.

According to the latest Roy Morgan Research conducted in the year to December 2018, Australians who shop at the big two supermarkets of Coles and Woolworths are keenest to buy groceries online.

And, over a third of Coles’ shoppers (34%) and Woolworths shoppers (34%) would consider buying groceries online in the next year.

According to the research, customers of the smaller supermarket chains Aldi and IGA are less likely to consider buying online. And, just over a quarter of Aldi customers (26%) and just under a quarter of IGA customers (23%) would consider buying groceries online in the next year.

Although millions of respondents profess an interest in buying groceries online, only a small proportion do online grocery shopping, the research reveals. In an average month, just 5% of Woolworths customers and only 4% of Coles customers buy groceries online.

Roy Morgan chief executive Michele Levine says the online retail revolution had yet to really make a dent in Australian grocery purchasing, but the arrival of Amazon in Australia in 2018 and the impending entrance of Kaufland to the Australian grocery market were changing the market.

“Despite the online revolution shaking up the face of retail in recent years, the grocery and fresh food market has stubbornly resisted the convenience and value for money proposition that online retailing has used to disrupt many other retail categories,” Levine says.

“This is not because consumers aren’t interested. Over five million Australians would now consider buying groceries online in the next 12 months – just under a third of Australian grocery shoppers.

“The market is there for the taking however thus far consumers haven’t been convinced by the online grocery services on offer. Just 4% of grocery shoppers buy their groceries online in an average month equivalent to about 600,000 Australians.

“Although the gap between interest in online grocery shopping and the follow through remains significant, and has persisted for several years, there have been significant developments in the Australian grocery and food markets in recent months and there are more coming.

“Amazon launched its online Australian food delivery service late in 2018 and German supermarket giant Kaufland is set to begin opening new supermarkets in Australia later this year. Kaufland also offers an online fresh food service in overseas markets. The marketing power and reach of Amazon is particularly important in driving this disruption as we have seen for over two decades.”

According to Levine, Amazon’s decision to acquire American fresh food retailer Whole Foods and launch the new Amazon Fresh grocery brand in the US using a hybrid model of shop/home delivery online and shop/pick-up in store is a new way for many to think of grocery shopping.

“The rollout of Amazon Fresh (which has yet to launch in Australia) could well, in hindsight, represent a ‘tipping point’ in convincing shoppers who may have been skeptical of online grocery shopping in the past to sample the experience for the first time," she said.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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