TORONTO–(BUSINESS WIRE)–One of the most important reasons shoppers choose not to use a grocery delivery service is because they don’t want to pay more than necessary, which was tied to wanting to select their own products according to a new study on buyer behavior of Mercatus, in the field from June 30 to July 1, 2022. Specifically, the desire of customers not to pay more than necessary was directly focused on the additional costs related to the delivery service, and not on the prices paid for the products on line. The research also found that when given the choice, customers are much more likely to select a time slot later the same day, or even the next day, if it means they can pay lower delivery costs.
“If you’re a grocery delivery customer — especially a customer using a third-party marketplace — it’s understandable that you’ll want to find ways to pay less given the impact of inflation on purchasing power” , said Mark Fairhurst, Vice President of Marketing at Mercatus. costs, including delivery charges, customer service charges, fuel surcharges, and even a very modest tip, are some of the last things customers see during the checkout step, and they can add 20 $ or more on invoice.
New shopper behavior research from Mercatus showed that one in five US households used an online grocery delivery service in the past month. Among the households that chose not to use a grocery delivery service, the two main reasons are at 62% respectively between “I like to select my own fruits and vegetables” and “I don’t want to pay the additional costs, fees and tips.” The older customer group (>60) was significantly more concerned about picking their own produce than younger shoppers (75% vs. 53%), while the desire to avoid to pay service-related costs was the same across all age groups.
Only one in seven households (14%) cited “goods are more expensive online than in stores” as a reason for not using a delivery service. “These results reinforce the idea that customers are more sensitive to additional service costs that they can clearly see,” said David Bishop, partner at Brick Meets Click. “This makes sense because accurately perceiving the price differences of online versus in-store products, even with items of known value, requires more effort on the part of the customer.”
Today most customers only have to choose when they want their order delivered, as delivery costs at that time are usually fixed, but research has found that it is possible for grocers to challenge this practice and consider a variable fee approach based on when a customer wishes to receive the order.
When presented with a flat fee of $9.95 for a large order (>$100), over 30% of customers selected to receive their order within 30-60 minutes, and over 40% of customers have selected to receive it within 1 to 3 hours; less than 10% opted for the next day or later.
When offered variable fees that decreased as the delivery time was extended, the share of shoppers who chose delivery within the 30-60 minute and 1-3 hour windows decreased further half and more than 40% of customers selected to receive the order the next day or later.
“Grocery shoppers don’t want to pay more than they have to, and the explicit fees that come with online delivery are a big speed bump,” said Sylvain Perrier, President and CEO of Mercatus. “Other aspects of this research reinforce that grocery store customers buy from regional grocers for different reasons than large retailers like Target or Walmart. Being more convenient is the number one reason customers prefer groceries to large retailers, followed by the quality of the products they want to buy.”
This research on omnichannel buyer behavior is the first in a three-volume series. Volume 1 explored other areas of importance to regional grocers, including where households primarily shopped, how customer demographics varied by retailer type, reasons for choosing a primary grocery store, and more. Again. Mercatus’ next volume of shopper behavior research will focus on what drives shopper behavior toward pickup. For more information and to download the full Volume 1 report, visit Mercat.
About this consumer study
Mercatus’ Personalized Shoppers research was conducted by Brick Meets Click via an online survey from June 30 to July 1, 2022, of 1,847 U.S. adults, ages 18 and older, who participated in Household Shopping. The sample was weighted to match current demographic measures related to age and census region based on the US Census Bureau’s 2020 American Community Survey. The margin of error for the first results was +/- 2.6% at the 95% confidence level.
Mercat helps leading grocers regain control of their e-commerce experience, enabling them to deliver exceptional retailer-branded online shopping, end-to-end, from store to door. Our vast network of more than 50 integration partners allows grocers to work with the partners of their choice, on their terms. Together, we enable customers to create authentic digital shopping experiences with solutions to drive shopper engagement, increase share of wallet and achieve profitability, while quickly adapting to changes in customer behavior. The Mercatus Digital Commerce platform is used by major North American retailers including Weis Markets, Save Mart brands, Brookshire’s Grocery Company, Kowalski’s Markets, WinCo Foods, Smart & Final, Stater Bros. Markets and others.
About Brick Meets Click
Brick meets click is an analysis and strategic visioning company that connects the food industry of today with the needs of tomorrow. Our clear thinking and practical solutions help customers make their strategies and offerings more engaging and relevant in the evolving US grocery market. We bring deep industry expertise, knowledge of what’s to come, and fact-based analysis to meet the challenge of finding new paths to success.