What was once a disruptive concept for shopping has now become the norm — even for buying groceries. Amazon paved the way, and now Wal-Mart, Kroger, ShopRite, Meijer and Safeway, among others, have realized the only way to beat the retail behemoth is to jump aboard the e-grocery bandwagon.
With Kroger and Wal-Mart at the forefront, these supermarkets are working hard to expand their digital grocery shopping reach with options to buy online for curbside pickup. According to research by Morgan Stanley, the number of U.S. consumers buying fresh groceries online will reach 26 percent this year, which is more than three times last year's figure of 8 percent. 2015 saw $16 billion spent on groceries online. This year, that figure will be a whopping $42 billion, a 163 percent rise.
Wal-Mart began offering online ordering and customer pickup over the past year, and in recent months its sales have picked up big time, despite increasing competition. Now, Wal-Mart has expanded the service to a several hundred stores and more than 30 metropolitan areas across the country, competing successfully with online giants like Amazon and local chains alike.
Kroger has also been aggressive in adding to its pickup curbside e-grocery offering with the app ClickList — fiercely competing with Walmart in this space, as they have done offline as well. In recent years, Kroger cut its prices to just 1.2 percent more expensive than Walmart, while offering superior selection and service.
Yes, the competition is fierce, yet Wal-Mart has once again proved its business prowess. Wal-Mart's curbside pickup service is free, while Kroger charges $4.95 per order. Even though the first three orders are free, this is a long-term service, and customers are definitely going to look at the bottom line. The fact that Wal-Mart customers can also pay online — other stores require credit card payments at the curbside — might tip the jar in favor of Wal-Mart.
More than 30,000 fresh and consumable items are offered to consumers through the Wal-Mart online ordering service, and a minimum purchase is $30 in most markets. Staff members are being trained by expert e-commerce market coaches to deliver convenience and customer satisfaction, do all the footwork for customers and hand over their groceries without them ever having to leave their car.
Apart from these two leading supermarket brands, there is also Michigan-based supermarket chain and e-retailer Meijer, which has announced major expansion plans for its curbside e-grocery program in the Midwest. It plans to have the service available at a total of 33 stores across Michigan, Indiana, Ohio and parts of Illinois. Like Kroger, Meijer is charging a fee for services in select markets, ranging from $4.95-$6.95.
Safeway has also jumped onto the bandwagon with its first e-grocery services being offered in Largo, Floida, near Tampa. It's not difficult to see why this phenomenon is developing so quickly. Internet Retailer's 2016 Online Shopping survey showed 39.5 percent of consumers are willing to buy groceries online.
Above all of them looms the tangible threat of AmazonFresh, which has taken the concept of convenient grocery shopping to the next level. While supermarkets and their new e-grocery options are mostly designed for pickup at the store, AmazonFresh delivers them to homes.
Grocery shopping can't get easier than that. However, Walmart's success with the curbside pickup concept has given Amazon quite a run for its money. The supermarket has extensive reach through its traditional stores and as mentioned, unlike the online delivery services or other traditional competitors it does not charge for this convenient service.
