3 Reasons Why Amazon is Essential to E-Grocery
E-commerce has unleashed new options for consumers. For example, brands that only sold through brick-and-mortar now take orders and ship products. Because of this, challenger brands have entered the space and increased competition for legacy brands. This is especially true in the grocery category.
When it comes to e-commerce, more than 80% of shoppers say they discover new products or brands on Amazon. This is encouraging brands considering selling online and those that are ready to optimize an existing presence. Continue reading to learn more and for three reasons why Amazon is essential to e-grocery in particular.
Amazon is the Top Player in E-Grocery
There are many different e-commerce channels brands can use to sell their products. But, there are differences to consider when forming an effective strategy. For example, Walmart.com and Target.com are becoming bigger players by the day, but Amazon continues to be the top player.
In fact, Amazon’s e-grocery market share is around 33%, according to emarketer. A TABS Analytics study also showed Amazon with an industry-leading 36% e-grocery ownership.
The bottom line is, regardless of the channels e-grocery brands decide to include in their strategy, Amazon should be among them.
Brands can Cater to Lucrative Audiences on Amazon
An important reason e-grocery brands succeed on Amazon is the ability to target and cater to different audiences. There are significant trends within demographics making it necessary to target accordingly.
For example, when it comes to buying food and beverage products online, men (38%) are more likely to make a purchase compared to 29% of women. Six in 10 men also report an increase in Amazon purchases year over year. But, only half of women report the same increase. So, Amazon already has the built-in audience e-grocery brands need to capture.
Another trend to keep in mind is online food and beverage sales are typically driven by higher-income households. These customers usually live on an income of more than $100K and are 18% more likely to buy groceries online. Like the built-in male demographic, Amazon also has an average shopper making between $50K and $100K annually or more.
Amazon’s E-Grocery Category is Growing
According to eMarketer, Amazon sold $8.2 billion worth of groceries online in 2018. We expect growth to be fueled by consumer demand and strategic brands and retailers. It will be interesting to see the continued innovation to address the common logistics and cost concerns associated with e-commerce. With advancements, perishables will likely continue to grow as a popular commodity in e-grocery.
Amazon is crucial to any grocery brand looking to form a strong e-commerce strategy. But it’s important to understand the majority of consumers still shop at a grocery store.
Legacy brands need to maintain a strong brick-and-mortar presence and ensure their digital footprint provides a similar, complementary experience. This way frequency and recognition can work to a brand’s advantage.
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