Online Grocery Shopping Could Have Lasting Effect On The Supermarket Industry Following Coronavirus

Customer shopping in a grocery store
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Due to the coronavirus outbreak, many people are either forced to stay home or are self-isolating to avoid the spread of the disease. While grocery stores remain open in most places, many people are choosing to carry out their grocery shopping online through the delivery option provided by major supermarkets. According to CNN, the explosion of online grocery shopping may prove to show a lasting effect on the supermarket industry.

JJ Fleeman is the chief e-commerce officer for U.S. company Ahold Delhaize, which owns various grocery store brands throughout the country, including Stop & Shop and Peapod delivery service. Fleeman commented that they have seen a large increase in the number of customers over 60 that are now using online delivery services.

“We are seeing a larger percentage of customers over the age of 60 that are coming online. We’re seeing a lot of new customers coming into the channel.”

A recent survey carried out by analysts at Gordon Haskett Research Advisors found that 41 percent of consumers that had purchased groceries for online pickup or delivery had done so for the first time. In the past week, about a third of consumers had used online delivery services.

Vice president of industry relations at trade group FMI Doug Baker also commented on the shift in consumer behaviors.

“Consumer behaviors always shift in times of disaster. People are learning new skills and how to shop online as a result of what we’re experiencing today.”

A Peapod truck prepares to depart May 17, 2001 at a Peapod's warehouse in Niles, IL.
  Tim Boyle / Getty Images

Some of the consumers who have reported using grocery delivery services for the first time have reported that they will continue using them even after things go back to normal.

The surge in online grocery shopping has proven difficult for many of the supermarkets providing the service. Compared with a year prior, downloads of Instacart, Shipt, and Walmart’s grocery app have increased 218 percent, 124 percent, and 160 percent respectively.

Delivery and pickup networks have become overwhelmed with customers, which has led to long waiting times, cancellations, and outages in various parts of the U.S. To help alleviate the strain on the delivery network, many grocery stores are hiring new workers. Some companies are even adding web servers to help keep up with the increased demand.

Seth Sigman, an analyst at Credit Suisse, wrote a report that detailed how the coronavirus pandemic is shaping the way consumers purchase their groceries, possibly for the long haul.

“We see this unfortunate period accelerating structural changes in consumer shopping.”

The long-term effects will likely impact business for smaller grocers that don’t have the resources to invest in building a delivery infrastructure.