Online sales of groceries more than tripled between 2013 and 2018, according to market research firm Packaged Facts in its new report, "Online Grocery Shopping in the U.S., 2nd Edition."
And it’s only looking up. In fact, Packaged Facts predicts that between 2018 and 2023, they will more than quadruple as online options become more available and consumers become more open to trying online shopping or using online options more frequently to purchase their groceries.
Specifically, Amazon and Walmart are the biggest players in the market, together accounting for nearly 28 percent of online grocery sales. Meanwhile, Instacart, Kroger, FreshDirect and Peapod represent other large providers in the online grocery market, with Instacart being the largest third-party pack-and-deliver company.
But where does all this online shopping leave candy?
One survey from Slickdeals.com found that three in four Americans buy candy at the register before they checkout. But the “register” looks a lot different online.
And even before they get that far, there’s a matter of finding the right item. Search “Snickers Candy Bar” on the regular Walmart app and you’ll get a Halloween candy bag for $23.98 and a 48-ct. $36.95 box of regular Snickers as your top two choices. Not exactly what you want to add-on to an order. Granted, you’ll find an individual Snickers on the Walmart grocery app, but not everyone uses that for their online shopping. And not every impulsive candy purchase at Walmart is related to a trip for groceries.
For a long time, the biggest barrier to online shopping was that grocery stories didn’t have the distribution capacity to deliver refrigerated foods to individual houses. But one big change has fixed that — more and more consumers feel comfortable placing their grocery order online and then picking it up at the store. The Packaged Facts report specifically says that, “pickup is becoming a favored option for receiving online orders to solve the last-mile delivery problem.”
But what’s good for grocery stores isn’t always so good for candy makers.
And yes, there are some ways around this. Stores can push consumers to check out a couple more items, or suggest adding a candy bar before they hit the pay button, but it still won’t be the same.
The Slickdeals survey says that consumers are more likely to impulsively buy something that they have a coupon for, so maybe the key is to offer 50 cents off a chocolate bar before they complete the virtual checkout.
But even with these measures, there’s no doubt that candy companies will have to face an entirely new sales model — one that’s likely filled with higher-end items, bulk products and seasonal tie-ins.
The longer the industry waits to address these issues, though, the harder it will be to adapt when the numbers shift and suddenly Packaged Facts is reporting that 90 percent of consumers are using the Walmart app for their weekly grocery purchase.