Grocery ecommerce trends have changed drastically in the past few years due to the pandemic and its strict guidelines on social distancing. Visits to the grocery store became less frequent as everyone stayed six feet apart and focused on purchasing essentials.
However, the challenge of foraging for food led to many innovations in the digital space. Grocery retailers pivoted and started offering delivery options for groceries or the option to pick up in-store.
Nowadays, we have a range of options available when it comes to grocery shopping, such as shopping online, doing hybrid shopping (a blend of both in-store and online), or using third-party apps like Instacart or Uber Eats.
With online grocery sales expected to grow 11.6% in the next five years, it’s important to take note of grocery ecommerce trends in 2023 to stay competitive in this space as problems like "shrinkflation" loom over us during a recession.
While in-person shopping is still the more popular option, digital sales year over year are up in the U.S. and reached $10.7 billion in January 2023. (GroceryDoppio)
The acceleration of grocery ecommerce favors those who lean in, adapt, and make the right investments to stay ahead of the curve. Those retailers that win customers now have a greater likelihood of retaining them in the future, and there’s still a lot of room for innovation and refinement.
Now let’s get into six grocery ecommerce trends that you’ll likely see over the next year.
1. The Driving Forces of Gen Z and Millennials
As digital natives, younger consumers are driving the growth of the ecommerce market.
Here’s a quote from Bo Finneman, a leader in Sales and Marketing for McKinsey and Company, in an episode of the McKinsey podcast:
(Gen Z) are looking beyond tangible products and actually trying to understand what is it that makes the company tick.
What’s its mission? What’s its purpose? And what is it actually trying to build for us as a society?Bo Finneman
Here are some values and thought processes that younger generations look for in brands.
Sustainability: Gen Z will look for sustainable products on grocery store shelves and will gladly pay a premium if they know a product has sustainable packaging.
Personalization: Engaging with brands on our own terms is empowering. Utilizing tools like social media marketing alongside personalization will boost conversion metrics by creating a more tailored, connected experience for specific age groups.
Value: Gen Z and millennials are very aware of the concept of shrinkflation and will compare different products' pricing and weight to see if they can get the best deal. About 30% of these age groups are also prone to looking at flyers and using coupons to save.
2. Healthy Food Trends Lead To Green Consumerism
As many of us have transitioned to working from home, new foodie trends have emerged, such as eating clean, frozen options, global flavors, and a rediscovered passion for cooking.
In 2023, we’re expecting to see a big emphasis on clean eating, buying seasonal ingredients, and snacking on superfoods like berries and nuts.
Another topic that the coronavirus highlighted was our impact on the planet, particularly through our diet. Brands such as Amazon have already taken the pledge toward sustainability, and other ecommerce brands are likely to follow this trend as we continue to look for ways to reduce waste and preserve healthier eating habits.
According to Innova Market Insights’ 2022 Lifestyle & Attitude Survey, for the first time, global consumers surveyed said the “health of the planet” was their top concern instead of the health of the population.
With inflation wreaking havoc for grocery store staples like eggs, this means plant-based players like the brand Just Egg can gain more market share and be not only the more sustainable option but a cheaper option too.
Related: The Sustainable Ecommerce Handbook (Free Download)
3. Retailers Will Hone Their Models
The pandemic stress-tested supply chains and groceries bring their own particular set of challenges in this respect.
According to Elizabeth Bennet, VP of Global ecommerce at the Kraft Heinz Company, there are three models used by ecommerce grocers to serve customers:
- Home delivery: Customers complete all stages of purchasing digitally—discovery, transaction, and in-home delivery.
- Last Mile Delivery: Shoppers complete the discovery and purchasing portion of the journey, but an intermediary business, like Instacart, completes the home delivery.
- Click-and-collect (or BOPIS): Consumers buy online and pick up in-store (or outside the store).
During the pandemic, data shows that, overall, click-and-collect was the preferred method of online grocery shopping. However, with attitudes continuously changing and hybrid shopping becoming more common, retailers should try and create a seamless omnichannel commerce strategy for customers who like to shop online and offline.
4. Consumers Are Trying New Brands While Brands Strive To Keep Their Loyalty
A McKinsey survey found that 75% of consumers tried a new shopping behavior since COVID-19 started, and 73% of those who tried a different shopping method or brand intended to continue.
According to a Hubspot study, consumers are less trusting of the brands they buy from as much as they used to be in the past.
Michael Redbord puts it best when he says that “customers are a source of growth you already own and a better and more trusted way for prospects to learn about your business. The happier your customers, the more willing they are to promote your brand, the faster your flywheel spins, and the faster your business grows.”
So, what are the big players doing in 2023 to retain customers?
Marketing personalization is BIG. To help illustrate this, 40% of executives say their customer personalization efforts have directly affected sales and profits in channels like ecommerce.
For online grocery stores, personalization can take the form of recommendations based on a customer’s preferences. Retailers are also combining their platforms with meal-planning apps and recipe sites that build shopping around days and dishes, not just individual items.
Strengthening customer relationships
After implementing useful and personal customization to their grocery apps, large companies like Amazon Fresh and Walmart Plus continue to unveil loyalty programs for their subscribers.
We’re seeing bigger grocers like Hy-Vee incorporate a personal shopping service, free deliveries, and dedicated customer helplines and chatbots to maintain relations with customers.
5. Taking Advantage of Influencer and Social Media Food Trends
Grocery stores that want to appeal to younger demographics will need to study the social media landscape closely and take advantage of viral food trends and pop culture moments to create engagement.
Uber Eats recently partnered up with model Kendall Jenner to promote how almost anything can be ordered through their online grocery delivery service. The ad poked fun at a pop culture moment that has been heavily memed and discussed online and created instant buzz.
Instacart revealed that TikTok food influencer Emily Mariko made a huge impact on customers as orders for items like kewpie mayo, dried seaweed, and salmon went up 100% percent as people tried to recreate her viral salmon bowl recipe.
By partnering with influencers with a large social media reach, ecommerce brands can connect more closely with younger consumers who find their messaging more personal and matches their buyer’s intent.
Shopping to have an impact is important for them (well, us) knowing who is promoting something can change everything.
- Does this company support charities and actually do good, humane things in the name of food?
- Does the influencer have a good track record?
Knowing is everything for this generation.
6. Inflation Is Creating A Demand For Cheaper Groceries
Rising prices for pantry staples like butter, flour, and dried pasta have led angry customers to demand more transparency from grocery stores on their price hikes.
Although rising prices are mainly due to a combination of extreme weather events ruining crops, higher shipping and transportation costs, and supply chain issues, eye-gouging prices are making consumers suspicious of big grocery retailers.
More customers are now using apps like Too Good To Go and Flashfood to get cheaper groceries and help reduce food waste. Users can bid for items that are near their expiration date for a big discount to lower the cost of their weekly grocery bill.
Sites like Misfit Market also offer organic produce that is up to 40% cheaper than regular grocery stores. They sell “ugly” produce at steep discounts to help make food affordable and eliminate food waste. Customers can get their groceries delivered to them on a weekly basis and use eco-friendly packaging for orders. The company expects to grow its sales to $1 billion by 2024.
Final Thoughts on Grocery Ecommerce Trends for 2023
2023 promises to be another exciting year for grocery ecommerce businesses.
The competition will intensify, and, as always, the businesses that listen to consumers and pay attention to grocery ecommerce trends will turn into eventual winners.
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