Canadians slow to adopt buying groceries onlineThursday, June 02, 2016 > 12:22:39
That’s about to change quickly, a retail conference has been told
Canadians are laggards when it comes to buying groceries online today, but that’s about to change quickly, according to speakers at the Retail Council of Canada conference on Wednesday.
“We think you should think of this as the competitor that is coming in and is going to take 10 per cent of your market,” said Randy Burt, partner, A.K. Kearny Consumer and Retail Practice at the council’s annual conference, held at the Toronto Congress Centre.
In Britain, 15 per cent of grocery sales are conducted online, in France the figure is nine per cent. Five per cent of the $1-trillion grocery market in the U.S. is online, but in Canada, online shopping for groceries comprises less than two per cent of $120-billion in annual grocery sales, according to Vishwa Chandra, vice-president, retail accounts, Instacart.
“In Canada we’re just getting started,” said Chandra, who estimates that the market for online groceries in Canada is somewhere above 15 per cent. “The question is how quickly we get there,” he said.
Canada has been behind the curve because consumers weren’t ready for it and retailers didn’t have the infrastructure in place to offer it. Grocery delivery was seen by most grocers as a luxury, adding cost to operations and subtracting from profits in an industry where margins are slim to begin with, said Chandra. But that is changing.
Loblaws and Walmart offer online grocery shopping with pick-up in store at some locations, and Grocery Gateway, owned by Longo’s, already provides online ordering with home delivery.
Shopping online for everything from books to clothing and televisions is now common and consumers are ready to do more of their grocery shopping online, said Chandra.
And hot on the heels of millennials is Generation Z, those born after 1996, who are digital natives, having grown up using tablets, smartphones and computers. They are entirely comfortable with technology and don’t need to master new skills to use it. Generation Z expects that everything they need, including groceries, will be available online, said Chandra.