The future of retail: It’s about the experience

I always enjoy Bruce Peterson’s columns in our magazine and online. They’re among my favorite parts of Produce Blueprints.

Recently, Bruce posted a column called “Mourning the Death of the Shopping Experience.”

Basically, I agree with him. I don’t own any stock in retail grocery stores (although who knows what’s in those mutual funds of mine?).

But I was saddened when I read a new survey from the market research group Chicory showing that as of January 2022, 72 percent of shoppers had purchased groceries online in the past 90 days.

Of course, you have to ask which shopping experience Bruce is talking about, and whose.

My wife, Nicole, is presently a stay-at-home mom with kids in middle school. She enjoys her trips—mostly to a Mariano’s in Wheaton, IL, although for fish (which we eat often), it’s Whole Foods. But when we were both working full-time and the boys were toddlers, those dashes to the store between the job and coming home to relieve the nanny were nerve-racking. (This was a decade ago when online grocery shopping hadn’t come into its own.)

If you’re equally harried, online shopping is tempting. So shows the Chicory report: “By a landslide, the leading driver of ordering groceries online is convenience and/or time constraints (46%).”

Product availability came in second, at 19.3 percent. Health/safety concerns were merely 10 percent, suggesting that at least at this stage, the coronavirus is not a major factor in decisions to shop online.

One very peculiar omission from this report: I don’t find any statistics comparing percentages of online use broken down by age group: it doesn’t tell me what percentage of millennials shop online versus baby boomers. Age breakdowns have to do with frequency of online ordering only.

Did somebody overlook something, or are they hiding something—possibly that younger people do not buy online much or any more frequently than older ones? This would cast some light on the future of the whole online enterprise.

One interesting breakdown: popularity of categories. Produce accounted for only 16.6 percent of purchases, with another 18 percent devoted to other perishables (dairy or meat). Pantry supplies and staples accounted for almost a third of purchases. This isn’t surprising. One roll of a given brand of toilet paper is very much like another. Apples, bananas, steaks—less so.

I can’t doubt that online ordering is here to stay, but I’m not convinced that the conventional retail grocery is facing a death sentence. Bruce points to one reason: the shopping experience itself. If an individual has the time and leisure, and the experience is pleasant, retail grocery will remain inviting. If not, it will wither away.

But it is up to retailers to provide that experience. Whole Foods under the Jeff Bezos regime is more affordable than it was, but it is also far less inviting. I have to ask whether the long-term Amazon strategy is to make Whole Foods and Amazon Fresh equally flavorless, pushing business more and more online. If indeed this is happening, the strategy is far from foolproof.

Ambience costs money. But so does online servicing. As Bruce points out, “It takes much more labor to select, prepare, and deliver a grocery order.” Online ordering transfers the labor of shopping from the consumer to the retailer. Somebody is going to have to pay for that. In the end, that’s going to be passed on to the consumer—either in prices or in delivery charges.

In any case, it’s still a free country. I don’t have to shop online if I don’t want to.