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Home Research and Data Research Perspective/Comments and Analysis

Produce Online: Winner Or Loser?

By: Jim Prevor and Brian Numainville February 1, 2020

Originally printed in the February 2020 issue of Produce Business.

By Brian Numainville

Read Jim Prevor’s Commentary below

In our annual RFG U.S. Online Grocery Shopper Study, we take a close look at a plethora of elements to ascertain how shoppers view their experience, from where they shop online for food and groceries, to how they rate the many touch points of the experience.

Each year we also examine purchasing across the store, as well as what drives a shopper to purchase items online (or not).

It may not surprise you to know that 74% of shoppers in our study indicate they purchase items from the grocery department online, followed by health & beauty care items (46%) and nonfoods (44%). However, what may be more surprising is produce receives top mentions among the fresh departments with 41% of shoppers indicating they purchase produce items online. We know from our previous research that factors such as freshness and quality top the list (both around 80% “very important” to shoppers), followed by price (58%), ripeness (53%), variety (40%) and convenience (38%) when purchasing produce online. On the other hand, shoppers who don’t purchase online refuse to do so because they want to choose it themselves (66%), it might not be fresh (55%), it might be too ripe or not ripe enough (41%) or it might be damaged (39%).

If all shoppers can count on receiving with minimal disappointment is a can of peas or a box of cereal, online shopping will never reach its full potential.

All of the fresh departments now, in our most recent 2019 study, show purchasing happening in double digit percentages. What is driving higher percentages of purchasing fresh items online? Several factors may be at play. As the older generations of conventional supermarket shoppers age, getting to the store may no longer be an easy task. These shoppers tend to purchase products from across the entire store, and that could be pushing all departments upward in online purchasing. This heavier use by Baby Boomers, for instance, finds support in our study showing more than half of the Boomers surveyed using online shopping more than five times. At the same time, we also know departments like produce are being purchased, both online and in-store, by younger generations due to an interest in health and wellness. Another factor contributing to growth of the fresh departments online may stem from the tactical experience gained by retailers in the online space, which, as they mature, may be contributing to more purchasing in the fresh departments.

So with all of this positive momentum, what could be bad? Shoppers were asked to indicate on a five-point scale whether, “The items I received met my standards for quality and freshness.” For the shoppers who gave a score of anything less than a top mark (5), they were asked which items fell short of their quality standards. Unfortunately, produce was mentioned by 45% of these shoppers, followed by meat (26%), center store (25%), frozen (23%) and dairy (22%). So clearly, despite the increase in people purchasing produce online, whether out of necessity or choice, it remains an area of disappointment for many shoppers, with the harshest critics being the Millennial generation.

Moving into the future, the stakes could never be higher with more and new competitors entering the online shopping arena, seemingly daily, coupled with the growth of younger generations of consumers. If all shoppers can count on receiving with minimal disappointment is a can of peas or a box of cereal, online shopping will never reach its full potential, and neither will the providers offering it. To truly win at online shopping, the fresh departments, and especially produce, need to deliver.

Brian Numainville is a principal with Retail Feedback Group (RFG), a consultancy offering a broad spectrum of research, consumer insight and consulting services. As a 360-degree listening partner, RFG helps clients with industry studies, business partner feedback, employee experience assessments, customer satisfaction programs, and consumer perception studies. For more information visit retailfeedback.com and follow RFG on Twitter @TheFeedbackGrp.

Online Still Has A Ways To Go For Produce

By Jim Prevor

When online grocery shopping first became a phenomenon, the assumption by most industry observers was consumers, in general, would not look to purchase produce online. The thought was consumers would in most cases want to select items for ripeness, flavor and to buy, as they often do in-store, with their eyes and other senses. Of course, there were exceptions: older shut-ins, people in remote areas, emergency purchases of an item consumers run out of, etc.

As it turned out, this wasn’t true at all. In actuality, consumers often have severe doubts about their ability to know whether a melon or pineapple is ready for tonight or to select a tomato or peach that will be perfect for the weekend. So, they were inclined to be happy at the idea “experts” from the online store would do the picking for them.

It may be a mistake to group all online purchases into one category. An interesting possibility is consumers may have different expectations — and different experiences — with different services. Stores that use Instacart or similar services to pick produce obviously do not have “experts” picking and, even if they did, there is no mechanism for communicating the quality of produce before consumers order.

In contrast, dedicated services such as AmazonFresh and FreshDirect make representations about produce quality. For example, FreshDirect has its Five Star Rating System.

The honesty and transparency of these systems render them trustworthy to consumers. After all, when did you ever go into a supermarket and see a sign touting, “Here are some below-average products. We are making them available just in case you need them for a recipe.”

What about Mr. Numainville’s report that 45% of consumers who use online services are dissatisfied with the produce bought online? Well, that is disappointing, of course. But, it really begs the question — how satisfied are consumers when they purchase produce in a store? If they buy an apple that looks good, but it is mealy when the consumer bites into it… if they buy some citrus that is dry when the consumer peels it… or bites into a plum that is hard and flavorless, then, presumably, the consumer isn’t satisfied with this produce even if they selected it.

Simply put, produce is not consistent in flavor and appearance, and so, very likely, disappoints consumers all the time, whether they buy in a store or online.

It is not surprising there should be more satisfaction with purchases of meat, center-store items, frozen or dairy. After all, how do you not meet consumer expectations for branded cottage cheese or whipped cream, frozen items or a prime steak? These either are manufactured products or close to it. They are consistent in flavor and appearance.

Simply put, produce is not consistent in either of these characteristics, and so, disappoints consumers all the time, whether they buy in a store or online.

There are two problems with online offerings: first, they don’t always give consumers a full range of choice, and, second, they don’t always deliver on the offer made.

When it comes to choice, logging in to my local Instacart and searching for grapes shows me seedless red grapes, seedless green grapes, a seedless combo at double the price, and grape tomatoes and a million juices and grape-flavored items. If I specifically enter “black seedless grapes,” they will show up. But, even though they are in the store, I have no ability online to order any of the newer varieties of grapes.

When it comes to delivery, I have ordered Clementines online, and even when a well-known brand was listed on the website, I did not receive that brand.

For most online items, there is an assumption that I do not care about brands, varieties or point of origin. The bananas have no branding at all. Nothing has a country of origin. But, occasionally, and inexplicably, something will pop up. Apparently, whoever creates the website doesn’t think consumers will care about the brand of bananas, but they will be concerned the seedless watermelon is from Sunshine State Produce Sales, Inc.

One of the challenges of selling produce online is promotion or lack thereof. When a consumer walks into a store and there is an exceptionally flavored fruit, something new or a seasonally perfect item, stores can promote by changing the location of the item, size of the display or sampling, etc.

Online, services such as FreshDirect promote the “Top-Rated Produce” and put produce items in the “Fresh Deals” or “Great Cart Starts,” but Instacart seems to put mostly grocery items on its front page, and maybe items that have paid for placement.

How produce will be promoted online… how new and exciting varieties will be brought to the consumer’s attention… how brands and country/region of origin will be communicated… all of these are open questions. For the one who finds the answer, there is a great fortune to be made.

TOPICS:Brian NumainvilleComments and AnalysisJim Prevorresearch perspectiveRetail Feedback GroupU.S. Online Grocery Shopper Study
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