As consumer dollars keep shifting online generally in the pandemic, e-grocery in the U.S. continues to explode, hitting a high of $9.3 billion in January, up 15% from November, according to a survey conducted by Mercatus/Brick Meet Click. Home delivery and store/curbside pickup represented 77% of the total.
Walmart is taking another huge leap forward in its attempt to dominate grocery sales, launching an aggressive plan to increase the number of stores using micro fulfillment via automation and robotics to speed orders to local customers as it builds on the digital legacy of the departing Marc Lore. Dozens of such locations are planned.
As CPG marketers revamp their plans to reach consumers at home, they need to consider a new set of questions. What drives consumers’ online product choices? How is this shifting as COVID-19 unfolds? What role will ecommerce play in the future? Increasingly, CPG marketers must turn to AI-driven data that delves into the consumer motivations and the impact of pandemic-related openings and closings on sentiment.
Dark stores, even as a temporarily approach, can help offset the cost of underperforming stores and the expense of freight and logistics, especially in more densely populated areas. It also takes online fulfillment out of store operations, allowing retailers to concentrate on customer service and minimizing inventory confusion.
As 2020 comes to a close, it’s time to reflect back on a wild and crazy year in retail, to paraphrase the Festrunk brothers from Saturday Night Live. COVID-19 came in like a wrecking ball in February and March, causing widespread shutdowns that hit retail especially hard, leading to hockey-stick growth in ecommerce.
Dutch supermarket company Ahold Delhaize, owner of Giant and Stop & Shop, has acquired a majority stake in Bronx, NY-based delivery provider FreshDirect, giving it a leg up on ecommerce fulfillment as e-grocery is exploding amid the pandemic. Centerbridge Partners is also acquiring a 20% stake in FreshDirect.
French robotics firm Exotec, which lists Japanese fast-fashion retailer Uniqlo as a major client, has raised $90 million to power its global growth in ecommerce fulfillment. Founded in 2015, Exotec is built on a goods-to-person model with its Skypod bots which uses laser guidance to navigate a fulfillment center.
Ocado, the UK grocery concern that has struck deals with grocers around the world to use its robotic fulfillment center technology, is being sued by AutoStore for intellectual property theft – with AutoStore in turn being investigated by Ocado for patent infringement. AutoStore filed the lawsuits in London and New York.
While total e-grocery sales in the U.S. declined 20% in August vs. June to $5.2 billion, other factors indicate strength in the sector, such as growth in average order value and repeat usage intent, according to a survey by Mercatus and Brick Meets Click. AOV reached a high of $95, the survey found, 32% higher than a year ago.