Our latest consumer research reveals that an increasing number of shoppers are going online for their grocery shopping.

Online Shopping 2009 has uncovered that 13% of adults now shop online for groceries – up by 63% over the last three years.

Opportunity for online grocery to expand

However, although shopping online for groceries has become increasingly popular over the last few years, this section of shoppers represents less than one in four of those who buy goods and services online. This means there is a significant opportunity for grocery retailers to expand their online sales.

The following chart shows the frequency that shoppers conduct grocery shopping online:

Our latest research shows that the online grocery shopper base is dominated by those buying on a relatively infrequent basis (30%), for example, special occasions such as parties and Christmas.

I only use it at Christmas when I know it is going to be bumper to bumper with trolleys.     Bushey, mixed, with children aged under 6, C1C2

Less than one in six (15%) of online grocery shoppers had a heavy reliance on online grocery shopping and purchased once a week or more frequently.

Most online shoppers fall into the “regular/top-up” group.

• A third (34%) buy food and groceries online every 3-4 weeks
• One in five (21%) purchased slightly more frequently, once every 1-2 weeks.
  Many of these shoppers liked to top-up on certain products in-store.
   

The future is online… and in-store

Online is set to play a greater role in future grocery shopping patterns. We predict that the value of the online grocery market will nearly double in size to £7.2bn by 2014, with a forecast annual growth rate more than three times faster than that of the wider grocery sector.

More demanding shoppers leading busier lifestyles will encourage greater online usage, while the development of online shopping from mobile devices should attract new shoppers and create new purchasing opportunities. Improvements in website capability and capacity, including enhanced search functionality and increased tailoring, will also drive growth.

More shoppers will add online sites to their grocery shopping repertoire. However, online is not about to challenge the dominance of the in-store environment. The number of shoppers using supermarkets will actually increase over the next five to ten years.

I will always have to pop to the shops for milk, bread, ham, sandwiches for school and I order all my meat and fish from a butchers.     Potters Bar, female, with children aged12+, BC1

Realising growth through online point-of-purchase marketing

Respondents in our online survey were asked what would attract them to start or increase the amount they shop online for groceries.

Four areas dominated the wish list:

• Better pricing
• Confidence in the availability and delivery of products
• More efficient and secure ordering
• Better choice and quality of products

	Examples of online point of purchase marketing

Although fewer believed that they impulse purchased more online than in-store, more than nine in 10 online shoppers said that they can be tempted to try something new online, representing further promotional opportunity for manufacturers and retailers.

One of the favoured online marketing techniques to encourage impulse purchasing is having offers listed at the top of the page, mentioned by four in ten online shoppers
(39%). Other key tactics include free samples, more special offers and offers on linked products.
 

How can retailers and manufacturers benefit from online growth?

Trading in an online environment requires a different mindset and approach in order to maximise the available opportunities, and may require an alternative product positioning, or even distinct products and promotions. The bulk of shoppers remain very much on an online journey.

Engaging with groups at the different stages of this journey, and tailoring the approach accordingly, will be the key to success. This will include:

• Providing reassurance to potential online grocery shoppers regarding issues such as substitutions and product quality and overcoming any negative perceptions
• Re-engaging with lapsed users by communicating the regularly improved benefits of online shopping
• Inspiring occasional and top-up online shoppers to increase frequency of usage through incentivising more regular shops, and driving transaction size through improving the ease of site navigation, as well as encouraging new product trial through innovative point-of-purchase marketing ‘bringing products alive’

More information:

	Online Shopping 2009
	IGD predicts that the online grocery market will will nearly double in size by 2014. Understand how online grocery shopping behaviour and motivations are changing, and the drivers and barriers to the future growth of online shopping with IGD's Online Shopping 2009 report.

	UK Grocery Retail Outlook 2009
	IGD's complete grocery retail sector guide. Featuring the latest insight on the rapidly changing UK grocery market, it will help you understand the strategies of leading UK grocery retailers, the impact of market influences, the drivers behind shopper trends, and where your business can grow.

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Michael Freedman has over 18 years agency and client-side experience in managing and conducting qualitative and quantitative research projects covering emerging trends affecting the food and grocery industry. Michael has recently been involved in research exploring food-to-go, understanding attitudes to place of origin, local food and food miles, and exploring how these issues are affecting shopping purchase decisions.

Michael is an experienced presenter who regularly delivers bespoke briefings and training courses on shopper behaviour. Michael is the author of IGD's Promotions and Customer Loyalty report and Online Shopping 2009.