Online Grocery Shopper Behaviour

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Free sample extract from our cutting edge and authoritative study into shopper motivation and behaviour, in UK online food and grocery

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Online Grocery Shopper Behaviour

  1. 1. Evolution Insights: Shopper Insight Series Online Food & Grocery: The Shopper Perspective Essential insight into shopper motivation and behaviour in UK food and grocery online SAMPLE EXTRACT Evolution Insights Ltd Prospect House 32 Sovereign Street Leeds LS1 4BJ Tel: 0113 389 1038 http://www.evolution-insights.com www.evolution-insights.com 1
  2. 2. Disclaimer Please note No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written consent of Evolution Insights Ltd. The content of this report is based on information gathered in good faith from both primary and secondary sources and is believed to be correct at the time of publication. Evolution Insights can however provide no guarantee regarding the accuracy of this content and therefore accepts no liability whatsoever for any actions taken that subsequently prove incorrect. © Evolution Insights Ltd 2010 www.evolution-insights.com 2
  3. 3. About Evolution Insights Evolution is a leading research consultancy specialising in shopper motivation and behaviour. We deliver off-the-shelf, tailored and bespoke research for manufacturers, retailers and agencies. Our research and analysis helps clients • Evolution offer a range of products & services for develop targeted shopper marketing clients in the field of shopper research:- initiatives designed to influence • Off-the-shelf research shoppers at the point of purchase. – Evolution’s off the shelf research publications deliver affordable insight into shopper motivation and behaviours in UK food, drink and grocery • Insight Plus – Insight Plus offers your business the opportunity to engage in any of our regular shopper research projects in advance of We use a range of research publication, tailoring the scope to suit your needs methodologies to discover genuine insights. Our research incorporates a • Bespoke Consulting broad spectrum of robust qualitative and quantitative research techniques. – As publishers of research, we are able to draw upon a wealth of existing proprietary data for consulting projects – helping to better inform and shape any further As a leading publisher of shopper research requirements. research, we are ideally placed to offer your business actionable shopper insight. Further information is available at our website http://www.evolution-insights.com Visit and sign up for Reflections, our free quarterly newsletter offering analysis and commentary on topical issues www.evolution-insights.com 3
  4. 4. Contents SLIDES INCLUDED IN THIS EXTRACT ARE HIGHLIGHTED IN RED Key findings and summary 9 General dislikes 48 Dislikes as barriers to increased frequency 50 Online grocery shopping: definition 19 Barriers to online grocery shopping 51 Barriers to online grocery shopping, by retailer used offline 52 Online grocery shopping: the market 21 The market –size, growth and forecast to 2015 22 The online grocery shopper context 53 The market – retailer shares 23 A framework 54 Circumstances (location and time of shop) 55 Online grocery shopping drivers and trends 24 Approach to online grocery shopping 56 Overview of drivers and trends 25 Extent of planning and shopper modality 57 Growth in UK internet use 26 Shopper missions 58 Future trends – personalisation 27 Shopper missions, by demographic 60 Future trends – inspirations and ideas 28 Shopper missions, by average spend 61 Future trends – rise of generation Y 29 Shopper missions, by frequency 62 Future trends – digital media and smartphones 30 Future trends – mobile commerce 31 The online grocery shopper journey 63 Future trends – rise of social media 32 Journey – definition 64 Future trends – multi-media 33 Journey starting point 65 Journey starting point, by retailer 66 The online grocery shopper: at a glance 34 Journey starting point, by mission 67 Shopper penetration and frequency 35 Touch points 68 Demographic profile and penetration 36 Touch points, by retailer 69 Penetration and frequency, by retailer used offline 37 Touch points, by mission 70 Penetration and frequency, by retailer used online 38 Shopper journey: examples 71 Online retailer penetration, by retailer used offline 39 Frequency (detailed) 40 The online grocery shopper journey: touch points 74 Frequency (detailed), by retailer used online 41 Touch points - summary 75 Expenditure, by average frequency 42 Front page and login 76 Expenditure, online versus offline 43 Favourites 78 Drivers of online grocery shopping 44 General special offers pages 84 Drivers of store choice 45 Product information 87 Drivers of store choice, by retailer 46 Department navigation 89 Category performance 47 Interrupts 91 Recipes 92 www.evolution-insights.com 4
  5. 5. Contents (2) Payment and checkout 93 Asda.com 120 Shopper share and demographic profiles 121 The online grocery shopper: key behavioural themes 95 Frequency and channel use 122 Managing budget 96 Drivers of choice and reasons shoppers like Asda.com 123 Impulse purchasing 98 Dislikes of online food and grocery shopping 124 Price comparison 99 Factors likely to make Asda.com shoppers shop grocery more frequently online 125 Brand loyalty and switching 100 Asda.com shopper attitudes 126 Range editing 101 Journey start point and touch points 127 Multi-buys and pack sizes 102 Sainsburys.co.uk 128 Shoppers’ ideas for improvement 103 Shopper share and demographic profiles 129 Overview 104 Frequency and channel use 130 More flexible/improved delivery 105 Drivers of choice and reasons shoppers like Sainsburys.co.uk 131 Ability to specify further detail for pickers/drivers 106 Dislikes of online food and grocery shopping 132 Better search, sort and product display 107 Factors likely to make Sainsburys.co.uk shoppers buy grocery more frequently online 133 Search, sort and product display: special offers 108 Sainsburys.co.uk shopper attitudes 134 Improved product information 109 Journey start point and touch points 135 Appeal of shopper marketing initiatives 110 Ocado.com 136 Online grocery shopping: retailer profiles 111 Shopper share and demographic profiles 137 Drivers of choice 138 Tesco.com 112 Dislikes of online food and grocery shopping 139 Shopper share and demographic profiles 113 Journey start point and touch points 140 Frequency and channel use 114 Drivers of choice and reasons shoppers like Tesco.com 115 Methodology 141 Dislikes of online food and grocery shopping 116 Factors likely to make Tesco.com shoppers shop for food and 117 Glossary 145 grocery more frequently online Tesco.com shopper attitudes 118 Journey start point and touch points 119 www.evolution-insights.com 5
  6. 6. Contents (3) List of figures and graphs UK online food and grocery market expenditure estimates (2006-2015f) 22 Drivers of store choice 45 Online retailer usage penetration 23 Drivers of store choice by retailer, versus average. 46 Drivers and trends in UK online grocery shopping 25 Relative frequency of category purchasing when shopping offline versus online 47 UK household Internet penetration 2006-2010 26 Dislikes of online grocery shopping among online grocery shoppers 49 Home internet access, by demographic, 2009 and 2010 26 Shopper appeal of initiatives designed to increase frequency of online grocery 50 shopping UK adults using the Internet every day, 2006 - 2010 26 Barriers to online food and grocery shopping 51 UK population age profile, 2010 estimate and 2015 projection 29 Barriers to online grocery shopping by shoppers’ offline retailer 52 Number of smartphone users and penetration of smartphones in the UK, 30 Factors influencing the online grocery shoppers’ context 54 2008 Q1 to 2010 Q2 Penetration of UK adults who say they regularly shop for grocery and own a 30 Location and time where shoppers do their online grocery shopping 55 smartphone, by demographic Penetration of online grocery shopping 35 Shopper’s ‘approach’ to conducting online grocery shopping 56 Penetration of online grocery shopping, by frequency 35 Online grocery shopping modalities 57 Demographic profile of online food & grocery shoppers 36 Shopper perspective on planning lists and meals in advance 57 Penetration of online food & grocery shoppers, by demographic 36 How do the four different categories of shopper missions translate online? 58 Penetration of online grocery shopping, by offline retailer 37 Penetration of missions by frequency 59 Penetration of online grocery shopping, by offline retailer and frequency 37 Penetration of missions by frequency (most regular only) 59 Penetration of online grocery shopping, by online retailer and frequency 38 Penetration of online shoppers who say they each of the following missions is 60 their most regular, by demographic Online grocery retailer used by multi-channel shoppers, by offline retailer 39 Missions by retailer 60 Frequency of online grocery shopping 40 Average spend by most regular online shopping mission 61 Frequency of online grocery shopping, by online retailer 41 Frequency of online grocery shopping by mission 62 Average spend of online grocery shopper, by typical frequency 42 Factors influencing the online grocery shopper’s journey 64 Typical spend online versus offline 43 Online grocery shopper journey – starting point 65 Reasons for online grocery shopping 44 Online grocery shopping journey – starting point, by retailer 66 Drivers of store choice 45 Online grocery shopping journey – starting point, by mission 67 Drivers of store choice by retailer, versus average. 46 Online grocery shopping journey – touch points 68 Relative frequency of category purchasing when shopping offline vs online 47 Online grocery shopping journey – touch points, by retailer 69 Dislikes of online grocery shopping among online grocery shoppers 49 Online grocery shopping journey – touch points, by mission 70 www.evolution-insights.com 6
  7. 7. Contents (4) The online grocery shopper journey: examples – weekly shop 71 Shopper perspective on a variety of potential shopper marketing initiatives online 110 The online grocery shopper journey: examples – weekly shop (2) 72 Online grocery shoppers’ use of Tesco.com 113 The online grocery shopper journey: examples – larger stock-up shop 73 Proportion of online shoppers who say Tesco is the online retailer they use most 113 regularly, by demographic Penetration of favourites, by retailer 72 How frequently do Tesco.com shoppers typically shop online, compared to all 114 online food and grocery shoppers? Shopper appeal of ‘favourites list’ related initiatives 73 Channel use of Tesco.com shoppers 114 Example of a typical weekly online shopper journey by touch point 75 Factors grocery shoppers say are likely to make them shop online more frequently, 117 interaction Tesco.com vs average Penetration of favourites, by mission 83 Shopper perspective on potential shopper marketing initiatives, Tesco.com vs 118 average Penetration of general special offers pages, by retailer 84 How Tesco.com shoppers typically start their online shop 119 Shopper appeal of general special offers page 85 Touch points typically interacted with by Tesco.com shoppers 119 Shopper appeal of ‘special offers’ related initiatives 86 Online grocery shoppers’ use of Asda.com 121 Shopper appeal of product information related initiatives 88 Proportion of online shoppers who say Asda is the online retailer they use most 121 regularly, by demographic Penetration of recipe pages while shopping, by retailer 92 How frequently do Asda.com shoppers typically shop online, compared to all online 122 food and grocery shoppers? Shopper perspective on overall spend online versus in supermarket 97 Channel use of Asda.com shoppers 122 Shopper perspective on impulse spend online versus in supermarket 98 Factors grocery shoppers say are likely to make them shop online more frequently, 125 Asda.com vs average Shopper perspective on pack sizes and bulky items online versus in 102 Shopper perspective on potential shopper marketing initiatives, Asda.com vs. 126 supermarket average How Asda.com shoppers typically start their online shop 127 Percentage of online grocery shoppers who say ‘an improvement in the 106 Touch points typically interacted with by Asda.com shoppers 127 freshness and quality of products delivered by being able to specify the best before date’ is likely to make them shop online more frequently, by retailer Percentage of online grocery shoppers who say ‘Improvements to how 107 Online grocery shoppers’ use of Sainsburys.co.uk 129 easy the website is to use and find what you want’ is likely to make them shop online more frequently, by retailer www.evolution-insights.com 7
  8. 8. Contents (5) Proportion of online shoppers who say Sainsbury's is the online retailer 129 List of tables they use most regularly, by demographic How frequently do Sainsburys.co.uk shoppers typically shop online, 130 Drivers of store choice by retailer, versus average 46 compared to all online food and grocery shoppers? Penetration of online shoppers who say they each of the following missions is 60 their most regular, by demographic Channel use of Sainsburys.co.uk shoppers 130 The online grocery shopper journey: touch points – summary 75 Factors grocery shoppers say are likely to make them shop online more 133 Shopper perspective on initiatives designed to encourage more frequent online 105 frequently, Sainsburys.co.uk vs average grocery shopping Shopper perspective on potential shopper marketing initiatives, 134 Drivers of store choice mentioned by Tesco.com shoppers, versus average 115 Sainsburys.co.uk vs. average How Sainsburys.co.uk shoppers typically start their online shop 135 Dislikes of online food and grocery shopping mentioned by Tesco.com shoppers, 116 versus average Touch points typically interacted with by Sainsburys.co.uk shoppers 135 Drivers of store choice mentioned by Asda.com shoppers, versus average 123 Online grocery shoppers’ use of Ocado.com 137 Dislikes of online food and grocery shopping mentioned by Asda.com shoppers, 124 versus average Proportion of online shoppers who say Ocado.com the online retailer they 137 Drivers of store choice mentioned by Sainsburys.co.uk shoppers, versus average 131 use most regularly, by demographic How Ocado.com shoppers typically start their online shop 140 Dislikes of online food and grocery shopping mentioned by Sainsburys.co.uk 132 shoppers, versus average Touch points typically interacted with by Ocado.com shoppers 140 Drivers of store choice mentioned by Ocado.com shoppers, versus average 138 Evolution’s methodology 142 Dislikes of online food and grocery shopping mentioned by Ocado.com shoppers, 139 versus average Topics of questions in quantitative survey 143 List of accompanied shop participants 144 List of accompanied shop participants 144 www.evolution-insights.com 8
  9. 9. Online food and grocery shopping: definition Online food and grocery is a broad field in the UK, comprising some of the largest supermarket retailers alongside e-commerce specialists and even category specific e-retailers. In scope • Evolution defines the online food and grocery shopping ‘channel’ primarily in terms of the major e-retailers. There are a variety of different formats to consider: • On the one hand, there are the Big 4 supermarket retailers, three of which already have an existing online grocery shopping proposition and for which, between them, account for the lion’s share of the online grocery market in the UK. • Secondly, there are ‘online only’ e-retailers such as Ocado and - much more recently – Amazon; who seek to drive market share in online grocery despite the absence of physical bricks and mortar stores. Ocado in particular enjoys notable success due to its early entry into the market and reputation for quality and innovation, and its partnership with Waitrose. • Third, there are major high street retail names such as Boots and Holland & Barrett who offer online shopping and delivery, albeit for a restricted range of categories that reflect their core proposition. We also note that while retailers such as Marks & Spencer and Iceland offer home delivery and online order for collection, they do not offer a full online grocery proposition at the time of writing. • Finally, there is a wide range of niche e-retailers who specialise in specific themes such as organic, clearance, and even category specialisms. Examples of these include Abel & Cole, Goodness Direct and Naked, just to mention a few. Out of scope • NB. ‘food and grocery’ includes categories such as drink, personal care and household cleaning yet excludes those major non food items such as clothing and electricals that are sold online by some of the major grocery e-retailers. Evolution defines the online grocery shopping channel in relation to e-retailer formats considered and relative market share. Major non food categories such as clothing and electricals, in addition to niche e-retailers specialising in certain themes or categories, fall out of the scope of this report. www.evolution-insights.com 9
  10. 10. The online grocery shopper: at a glance – online retailer penetration, by offline retailer Tesco’s universal proposition, focus on value and leadership in innovation positions it particularly well to attract the loyalty of shoppers who otherwise shop elsewhere offline. Many consider Tesco ideal for typical online shops, where the focus is often greater on bulkier branded and commodity goods. Online grocery retailer used by multi-channel shoppers, by offline retailer • Here we consider online retailer penetration by offline 100 retailer. In other words, we look at multi-channel shoppers who use both online and offline, and 90 86 compare where they shop online to where they shop offline. 80 73 • For example, an overwhelming 86% of Tesco shoppers 70 Tesco.com who also shop online at least occasionally, use Sainsburys.co.uk Tesco.com. In contrast, only 52% of Sainsbury’s 60 52 53 shoppers who also shop online use Sainsburys.co.uk. Asda.co.uk 50 % Ocado.com • In essence, we are able to measure the extent of cross- 40 Waitrose.com channel store loyalty among grocery shoppers. Tesco shoppers are particularly loyal when it comes to 28 Amazon.co.uk Grocery 30 shopping online, while Sainsbury’s shoppers are much 21 Another online retailer less so. Notably, Sainsbury’s loses the majority of those 20 16 who go elsewhere online to Tesco.com. Our qualitative 9 7 8 research suggests many shoppers whose nearest 10 5 5 5 6 6 3 5 3 2 1 1 2 supermarket is Sainsbury’s consider Tesco of a similar 1 1 0 0 1 0 quality and yet lower price. Others justify the ‘trade 0 Tesco Asda Sainsbury's Morrisons down’ to Tesco as sensible since they use online primarily for branded and commodity goods where price is the most important factor. Source: Evolution Insights • Perhaps of most interest is the destination of Morrisons shoppers who also Tesco.com has been particularly successful at shop online. At the time of writing Morrisons are yet to launch their online not only driving high levels of store loyalty offering, and over half (53%) of those who do shop online are using Tesco.com among Tesco shoppers, but attracting instead. We suggest that Morrisons may struggle at launch to regain the loyalty significant proportions of other Big 4 of its shoppers whom have already established comfort and routine with a shoppers through its universal appeal and different online retailer. leadership in online grocery. www.evolution-insights.com 10
  11. 11. The online grocery shopper: at a glance – category selection Household cleaning, dry and canned goods over index online, while fresh foods over-index offline. While this largely reflects the difference in underlying mission mix between the two channels, we note that sin categories under-index online despite their non perishable and sometimes bulky nature. Relative frequency of category purchasing when shopping offline versus online • Here we consider how frequently shoppers purchase each category online versus offline. Shoppers were Newspapers asked to rate how frequently they buy each category Tobacco when shopping online, and then how frequently when Pet care shopping offline. The graph highlights the relative Baby products difference in average score achieved by each category. Bathroom toiletries (e.g. soap, toothpaste) Personal care (e.g. shampoo, deodorant) • For example, household cleaning products are bought Health and beauty (e.g. cosmetics, slimming aids) more frequently when shopping online than when Dry goods (e.g. pasta, rice) shopping offline, while dairy and bakery are bought more frequently when shopping offline. Canned goods, sauces and condiments Frozen food • The graph highlights the effect of underlying Household cleaning (e.g. laundry detergent, dishwashing) differences in mission and frequency between online Breakfast cereals and offline shopping trips. For example, multi-channel Soft or carbonated drinks shoppers who shop online occasionally to stock-up (the Chilled juice most common online mission) are more likely to Tea, coffee, drinking chocolate and malted drinks purchase laundry detergent on these missions, due to Alcohol its long lasting, non perishable and bulky nature. Biscuits and crackers • It is interesting to note however that alcohol, crisps Crisps and snacks and confectionery under-index online despite sharing Chocolate and sweets some similar attributes. Chilled convenience food (e.g. pizzas, ready meals) Fresh meat, poultry and fish Our research suggests that many shoppers Fresh fruit and veg inc. salad are less likely to purchase sin categories Dairy, milk and eggs online, despite their non perishable and Bakery and bread sometimes bulky nature. Shoppers find it Bought more often Bought same frequency whether Bought more often easier to see and control their spend online, when shopping offline shopping online or offline when shopping online often sacrificing big ticket luxuries like alcohol Base = UK adults who say they shop for food & grocery both offline and online at least occasionally, n = 955. as a result. Source: Evolution Insights www.evolution-insights.com 11
  12. 12. The online grocery shopper journey: touch points, by retailer Here we consider how the different touch points of an online grocery shopper’s journey varies by retailer. While differences are relatively small, there are nevertheless some interesting variances to consider. Online grocery shopping journey – touch points, by retailer (excluding booking of delivery slot) • Special offers in particular are the forte of both Tesco 80 and Ocado – and less so with Asda. We also note the particularly high penetration of personalised special offers for Ocado, reflecting their leadership in this 70 68 space. Ocado also boast the greatest engagement in recipes and suggestions – in part due to the demographic of its shoppers but also in part due to its The favourites list (for example previous 58 58 orders, last order, previous bought, user focus on features, functionality and innovation. 60 57 56 55 created lists) 52 The keyword search • As expected, Sainsbury’s also sees a higher level of 52 engagement in recipes although perhaps not as high as 50 48 might be expected considering its shopper The general special offers pages demographic and celebrity endorsement. Furthermore it sees the lowest engagement in favourites and 40 highest penetration in keyword search (and indeed % The 'special offers relevant to you' pages shoppers who use none of these features). This supports the findings from our accompanied shops 30 30 where, many prefer to use simple department 29 28 30 25 25 The recipes and meal suggestions pages navigation as the main touch-point during their 23 journey. 20 18 I don't use any of the above • Interestingly, Asda falls short of the rest when it comes to personalised offers, something reinforced by our accompanied shops where many complained about 9 9 10 7 7 the lack of relevance of multi-buy deals in particular. 6 4 4 Asda also has the highest level of shoppers not using any of the website features beyond basic department 0 navigation. Tesco.com Sainsburys.co.uk Asda.co.uk Ocado.com* * Very low sample size n = 60 Source: Evolution Insights www.evolution-insights.com 12
  13. 13. The online grocery shopper journey: examples While every shopper journey is different, we are able to consider some high level examples of typical shopper journeys observed from our accompanied shops and supported by our quantitative research. Here we present the typical journey of a regular online grocery shopper. The vast majority of shoppers focus Shoppers often move on to department Many shoppers visit the general special offers at entirely on logging in, booking a navigation for later categories and the end of their shop for less than 30 seconds, delivery slot and getting started specific items they have written down just to check they haven’t missed anything e.g. non perishables and non food 46% use this feature AND Department Front page Favourites Keyword search Special offers Checkout navigation OR Weekly shoppers often use Keyword search is used either instead of The majority of shoppers spend a good favourites to rapidly shortcut department navigation (as a shortcut), or amount of time carefully reviewing buying regular staples and to in addition (to search for specific their basket, removing and adding break the back of their shop products, brands or forgotten items) items. Opportunities for personalised 55% of weekly shoppers start Roughly 1 in 4 use this feature reminders are strong. here, 68% use at some point . www.evolution-insights.com 13
  14. 14. The online grocery shopper journey: summary Touch point Common assumptions Our research suggests Front page and This is the best place for your top offers, shoppers expect to Page footfall does not necessarily equate to interaction with marketing initiatives – login see them at this stage. FMCG’s must support with their shoppers are very focussed on logging in, booking their delivery slot and starting their shop. strongest promotions of the year. Favourites This section is used by most shoppers to purchase regular The most likely to engage are frequent weekly shoppers who use it primarily as a shortcut items. It is a good place to position initiatives and alternatives to buy the regular staples. They often move away from the favourites after this, and to influence decision making. complain about the length and lack of personalisation. 1 in 3 don’t use favourites at all. General special Shoppers expect to the biggest discounts in this section, so it It’s more about the relevance than the depth of the cut! The majority of shoppers visit very offers pages is best used for fiercest promotions. briefly at the end of their journey to ‘see if they have missed anything’. Most give up very quickly if the offers are not relevant to them. Stock-up shoppers are more likely than others to use these pages. Product Shoppers want detailed information about ingredients, The majority of shoppers who visit product information pages do so just to quickly check if information pages nutritional content, provenance, suggested complements and the product is what they think it is, primarily using the larger picture to assess the product. alternatives. Department Good place for promotional activity as this replicates Issues here relate to ability to interrupt, with many shoppers exhibiting incredibly rapid and navigation shopping by aisle, where traditional shoppers are the most focused range editing through use of product pictures, price and retailer ‘offers’ graphics. open to offers. We find department navigation is particularly relevant to Sainsbury’s and Asda shoppers. Keyword search Very powerful position for shopper marketing as shoppers Shoppers often search for specific brands by keyword, or use keyword search as a quicker typically search for specific items they already intend to way just to find the right department. Those who recalled marketing and offers complained purchase. about low relevance. We suggest there is a significant opportunity to improve here. Interrupts Effective means to capture attention and influence Awareness in general is very high but recall of specific offers and interaction is very low. (banners) purchasing behaviour. Nevertheless, where relevant we suggest they are particularly effective. Recipes Great place to feature products, as recipe ingredients can be The majority of online shoppers are focused and have already planned their shop. Use of added directly to the basket. recipes is high but use while actually shopping is very low. Only 5% use this page while shopping! Opportunities here for greater education and synergy with above the line. Checkout Best area for impulse purchases and new products. Better used as a reminder - “have you forgotten …?”. Shoppers are focused on reviewing their basket and entering financial details. Relevance is key. We find impulse purchasing is very low. Source: Evolution Insights www.evolution-insights.com 14
  15. 15. The online grocery shopper journey: touch points – favourites (3) Many of our accompanied shoppers complained about the length of favourites pages – saying they mainly use them to quickly buy the ‘regular staples’ such as fresh fruit & veg, bakery, dairy and meat. I wouldn’t rely on it completely [‘my usuals’] though because I might miss something [Female, 20-39, C1, Sainsburys] It [favourites] reminds of Because it’s [the favourites list] laid For me the last order feature is about the things I need to ‘break out the same way the supermarket is helping me shortcut and save time – the back of the shop laid out, I use it to shop the staples. I rather than being about ordering the [Female, 30-39, AB, FT, Tesco] don’t have these on my written list same list every time. [Female, 20-39, C1, Sainsburys] [Female, 40-49, B, FT, Ocado] I always start with my favourites, and shop the fresh grocery items mainly, but then I get bored and • Online grocery retailers present favourites as a single list or by department. In either think ‘oh, I better stick to my scenario, favourites are presented in a similar order to aisles in the supermarket. I use the favourites as a prompt [written] list and not go off-piste. but then I shop the website for [Female, 30-39, C1, FT, Tesco] • Our accompanied shops find that many shoppers use the favourites as a prompt and to offers and alternatives before ‘break the back of the shop’ by following the lists in this order – they often carried a written deciding whether I want to buy (paper) list too and used this and keyword search/department navigation for later non- the usual or not perishable and non-food categories. [Female, 50-59, C2, PT, Asda] www.evolution-insights.com 15
  16. 16. Tesco.com – drivers of stores choice and reasons shoppers like Tesco.com Here we look at reasons why shoppers choose Tesco.com. We also present what shoppers who did accompanied shops said they like about Tesco.com. The qualitative research highlights the important role Clubcard plays in driving loyalty for Tesco.com Drivers of store choice mentioned by Tesco.com shoppers, versus average. Tesco.com Average I get more out of Tesco’s There isn’t an Asda near enough to % % loyalty scheme than me. If there was then I would use They offer the best value for me 46.1 47.2 Sainsbury’s – they send me it. But I can use them when I shop obvious money off vouchers in online. However, I will use Tesco’s They have the best promotions 32.0 34.0 online too because their Clubcard the post. They have the most suitable delivery times for me 21.5 29.3 [Female, 30-39, AB, FT, Tesco] points are good. [Female, 20-29, DE, Tesco] They have the cheapest delivery 9.9 25.0 Their produce tends to be the freshest/best quality 15.6 23.4 The reason I only use Their website is the easiest to use and understand 25.0 22.4 Tesco’s Clubcard scheme is Tesco.com is their Clubcard Their range is better than the rest 17.9 20.2 the most generous of the point scheme. I have looked different offers, and they at the others but never used They don't send product substitutes as much as their competitors 7.6 16.0 also send me vouchers by even once. I like collecting Because they are the same company as the supermarket I usually email for using online which points from the Clubcard 36.9 15.0 use makes it even better scheme [Female, 20-29, C1, FT, Tesco] They have my favourites list 19.0 12.3 [Female, 30-39, DE, Tesco] It's the only one I've ever considered 14.8 10.5 Other 11.8 10.1 Source: Evolution Insights I also think their Clubcard points are the best. [Female, 20-29, DE, Tesco] If Tesco do substitute they do so I also like the fact when my order arrives with Tesco that generally for a more expensive item but they tell me if they have substituted things or if anything has Tesco has a good variety of products, charge me the price of that I requested a shorter shelf life than they would like and they give me an particularly products that have features so i feel special! option to refuse it. Sainsbury's don't do this and annoyed [Female, 30-39, AB, FT, Tesco] like gluten free, and vegetarian Quorn me as a result giving me produce close to best before date. products. [Female, 30-39, AB, FT, Tesco] [Female, 20-29, DE, Tesco] www.evolution-insights.com 16
  17. 17. Methodology • Evolution carried out a preliminary survey of 100 shoppers, to test questions for the main survey and Evolution’s methodology establish an initial view of market penetration. Detailed online store audits were also completed, to facilitate awareness and commentary of online grocery retailer features, functionality and initiatives. Initial insights gained were used to help further design the Secondary and desk Preliminary qualitative and research quantitative research main survey. • Two quantitative surveys were utilised in this report. The first was part of a wider research programme and had a sample of 1,546 UK adults who said they regularly shop for food & grocery. This survey was used to determine overall penetration rates, barriers to online food and grocery retailing and offline retailers used. The second survey included only shoppers who shop for food and grocery online at lease occasionally. This sample of 1,002 completed all Main quantitative surveys Store audits questions relating to their online shopping behaviour. • 13 detailed accompanied shops including in-depth pre- and post-shop interview were then carried out to further explore interesting findings relating to the quantitative research, and to address in more detail topics such as journey, interaction with touch points, interaction with marketing, impulse purchasing, brand switching, managing budget and price comparison. Detailed accompanied shops, including pre- and Insights • Comprehensive and detailed assessment of all the data post-shop in-depth interviews received was then used to discover insights. Throughout this process, primary research was supported by secondary research drawing on Evolution’s proprietary databases, national statistics, news and industry resources. Evolution’s consultants Source: Evolution Insights also maintained close relationships with industry figures across retailers and manufacturers. www.evolution-insights.com 17
  18. 18. Methodology: quantitative research - survey Topics of questions in quantitative survey Demographic profiling • Detailed shopper insights were gained from two surveys - one of 1,546 UK adults who say they regularly Frequency of online grocery shopping shop for food and grocery, the other of 1,002 UK adults said they shopped online at least occasionally. The first sample was fully representative of the UK Reasons / barriers for online grocery shopping population who regularly shop for food & grocery, while the second was fully representative of the online Online retailer usage in terms of frequency and most regular grocery shopper population in the UK. Drivers of store choice • The survey contained 18 questions relating to topics outlined to the left – in addition to standard Offline retailer usage in terms of frequency and most regular demographic profiling questions. Missions in terms of frequency and most regular • The questions were designed to give maximum insight into shopper’s motivation and behaviour before, during and after online grocery shopping. Category purchasing online and offline • The survey was undertaken by PCP Market Research Spend online and offline Consultants on behalf of Evolution Insights. PCP is a company partner of the MRS and is therefore bound Circumstances, approach and modality while shopping online by the MRS code of conduct. Dislikes with online grocery shopping • The survey was carried out online during the week commencing 9th August 2010. Barriers to increased frequency Behavioural themes including impulse, range editing, spend, pack sizes Perspective on shopper marketing initiatives and potential improvements to online grocery shopping Source: Evolution Insights www.evolution-insights.com 18
  19. 19. Methodology: qualitative research – accompanied shops Accompanied shops were chosen as the primary method of qualitative research. This allowed for detailed investigation into themes such as journey, interaction with touch points, interaction with marketing, impulse purchasing, brand switching, managing budget and price comparison. List of accompanied shop participants • 13 accompanied shops were carried out during September 2010 in order to provide in depth qualitative research for analysis. Accompanied Shop Participants Number of children in • The format of the accompanied shops consisted of an Gender Age Social Class Marital Status household Retailer initial briefing and basic structured questions to Female 40-49 B Married 0 Ocado establish the shoppers’ online grocery context; observation and recording of the accompanied shop Female 50-59 C2 Divorced 2 Asda itself; and post shop questions (both unstructured Female 20-29 C1 Single 0 Tesco based on their behaviour during the shop, and structured to establish their thoughts on topics such as Female 30-39 D Divorced 2 Tesco likes, dislikes and ideas for improvement). Male 30-39 C1 Living with partner 0 Sainsburys • All participants were confirmed to be existing online Male 20-29 E Single 2 Asda grocery shoppers whom had a genuine need to conduct an online grocery shop at the time of their Female 20-29 D Married 0 Tesco involvement. All reasonable efforts were made to Female 40-49 C1 Married 2 Ocado provide an environment conducive to natural behaviour. Shoppers were observed and their actions Female 20-29 D Living with partner 0 Asda digitally recorded during the shop, but importantly Female 30-39 C1 Engaged 0 Tesco there was no interruption from or interaction with the facilitator during this time. Female 50-59 C1 Married 1 Tesco Female 30-39 C1 Married 1 Sainsburys • Participants were recruited by PCP Market Research Consultants on behalf of Evolution Insights. PCP is a Female 20-29 C1 Married 0 Sainsburys company partner of the MRS and is therefore bound by the MRS code of conduct. Source: Evolution Insights www.evolution-insights.com 19

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