Saturday, December 2, 2023

Australia trailing in global online grocery trends

Just 12 per cent of Australian consumers use e-commerce services to order groceries online and have them delivered to their home, the latest Nielsen Global E-commerce and New Retail Report indicates.

Australia’s take-up of online grocery shopping is 13 percentage points lower than the global average of 25 per cent, and well behind the Asia Pacific average of 37 per cent. Despite this, 55 per cent of Australian consumers surveyed say online order and delivery is a service they are willing to use.

An even smaller number of consumers are using the click and collect services that retailers such as Coles and Woolworths readily offer for grocery purchases. Just five per cent of Australian consumers surveyed say they order groceries online and pick them up using a drive-through service. However, 53 per cent are willing to use this option in the future.

“The Australian landscape and lifestyle are more complex to other markets, with many consumers living a reasonable distance from retail stores and many not being at home to accept grocery deliveries,” said Megan Treston, a Director in Nielsen’s Retail Industry Group.

“Advances in technology are providing greater flexibility for shoppers, and offers like click and collect and, more recently, bundles to overcome individual delivery fees are introducing new ways to overcome barriers for online grocery shopping. The delivery fee bundling offer is very exciting and we’re watching this space closely.”

Nielsen’s Homescan Shopper Panel data suggests that online represented 1.9 per cent of all grocery sales in Australia for the year ending June 13, 2015 and growth is substantial – up by 29.3 per cent for the year.

There is a similar trend to growth in online grocery shopping when looking at dollar growth by key department, signalling that online is vital to boosting growth in a relatively stagnant grocery market. The exception to this is health and beauty, which is a high-involvement category and also faces intense competition from such outlets as department stores, pharmacies and other online beauty retailers.

“The retailers who will win the most of this prize are those that will leverage technology to enhance the existing shopping experience and meet consumers’ evolving desires with a trustworthy service and by offering real convenience,” Ms Treston said. “Consumers are ready for it, so retailers should meet that openness to technology.”

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