Grocery and delivery sales will continue to be dominated by brick and mortar locations for the foreseeable future. However, as COVID-19 stay-at-home orders have temporarily shifted consumer purchasing behaviors due to logistics and the economy, researchers predict that the uptick in consumers looking to buy their groceries and alcohol online and in-app might continue through 2020 and beyond.
According to data from Kantar, it is estimated that “30% of new customers who try buying booze through e-commerce for the first time during the pandemic will remain long-term users.” Online alcohol sales more than doubled between March 7 and April 18. Now more than ever, convenience and visibility are going to be key to grocery and alcohol sales, which is causing alcohol brands to make big moves to catch up to where grocers are in terms of delivery capabilities.
Grocery deliveries hit a record high in April 2020. In fact, grocery deliveries increased 37% over what was seen in March. While grocery and alcohol sales still make up a small portion of overall e-commerce sales, food and beverages were the second highest category of items that consumers planned to purchase online during the pandemic, behind cosmetics and personal care items.
What Can Brands Do to Take Advantage of This Trend?
The surge in online alcohol and grocery sales is likely here to stay. Here are ideas that brands can leverage to meet consumers where they are:
- Tactic: Choose channels that allow for shopping experience integrations – According to VentureBeat, “shoppable ads aren’t brand new, but they are newly urgent. In recent years, seamless experiences through platforms like Amazon and Pinterest have conditioned consumers to expect the opportunity to instantly buy anything they see advertised.” Through integrations with vendors such as Shopify, platforms such as Facebook have shrunk the sales funnel and have simplified the process to convert. Brands looking to take advantage of this need to rethink their strategy and creative planning.
- Targeting: Reach grocery/alcohol app users – According to eMarketer, 58.2% of US digital grocery buyers bought groceries digitally before the coronavirus outbreak whereas 41.8% had not (Coronavirus Consumer Survey). Supermarket News expects online grocery sales to grow 40% in 2020. It is going to be more important for brands to be able to reach consumers who rely on the most popular grocery apps in order to convince them to add their products to their carts. Coegi has several vendors we work with to achieve granular targeting of consumers who have downloaded the popular grocery apps such as Instacart, Shipt and GroceryDirect.
- Creative: Offer discounts/coupons to entice consumers to try; reward repeat customers and encourage them to buy in bulk – Value laddering could be extremely helpful for brands that rely heavily on samples in-store and at events. Encourage consumers to try to first bottle for a 15% discount, or offer a BOGO on the box of new organic cookies. Then, when you have them hooked, offer them benefits for being loyal to your brand, e.g. free shipping on a case of wine, $15 off for the purchase of 3 or more boxes of cookies, etc.
As consumer behaviors and emotions continue to be impacted by the coronavirus, it’s crucial for brands to adapt with them. This is especially true of the grocery and alcohol vertical, where people are the most willing they’ve ever been to purchase these products online. If you’ve been primarily focused on traditional marketing and in-store promotions, now is the time to restructure your strategy to incorporate digital marketing to reach different audiences and expand your share of voice.
Author: Elise Stieferman, Client Strategist