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Food Retail Ecommerce During Coronavirus Outbreak

NetElixir and real data on the coronavirus

After our webinar presentation on Thursday, March 26 that detailed the impact on retail ecommerce during the coronavirus outbreak across seven retail categories, we summarized some of our statistical findings on ecommerce sales and customer shopping behavior in Friday’s blog post. We offer projections and real-time data into how the retail ecommerce industry is faring during the coronavirus outbreak. We were also privileged to have Parag Shah, Vice President of Grocery at Wakefern Food Corporation for Shoprite, as our Retail Superhero share how Shoprite has been managing the surge in demand.

Retail Superhero insights into ShopRite food retail ecommerce sales during coronavirus outbreak
Retail Superhero: Parag Shah of Wakefern Food Corp. for ShopRite

A week back, McKinsey offered advice to what food retailers should do during the coronavirus crisis. Parag Shah gives a firsthand insight into how retailers are navigating the changes caused by the coronavirus outbreak. 

Retail Superhero: Spotlight into Shoprite

Food and grocery ecommerce sales during coronavirus
A ShopRite location. Anthony DePrimo, from NJ.com

Udayan Bose, Founder and CEO of NetElixir, says, “While we have been going about our lives as much as usual, it wouldn’t have been possible without our service workers.” 

Parag Shah noted that getting the supermarkets ready for influx of demand during the outbreak required a lot of planning. Wakefern started planning in January, after seeing what had happened in China. From dealing with the fallout of hurricanes and other natural disasters over the years, the company has had a lot of experience in bulking up their supply chains to provide relief to the community.

Although, Shah says, “The COVID-19 phenomenon is unlike anything else we have seen.”

Food supply channels have diverted routes dramatically to fulfill changes in demand. According to Shah, before the coronavirus outbreak:

  • 50% of food consumed was done so outside the home
  • 38% of occasions are celebrated outside the home
How has coronavirus impacted restaurants and food retail
38% of celebratory occasions are shared outside the home. Photo by Daria Shevtsova from Pexels

Based on the restrictions throughout different states to enforce social distancing, food consumption is now all done primarily within the home. Food service channels, which supplied restaurants, entertainment, and retail vendors, have diminished. We have experienced what Shah calls “a tectonic shift in a short period of time,” as outside food demand is now being fulfilled within the home.

The shift in food demand is still evolving. Shah charted the sequential change from panic buying to comfort buying as:

  1. Concern amid the health crisis prompting a run on sanitizer and health products
  2. Growing fear leading to stockpiling of paper and water products
  3. Food sales to supplement school and work closures
  4. A turn to comfort food items as the crisis persists

In buying from retailers, people were motivated by fear and purchasing based on availability of products, not necessarily pricing. Shah urges for retailers to focus on providing solutions to their customers. Many consumers now have finite budgets, so as closures and social distancing continues throughout the month of April, prices will be key variables in future sales.

What Can Retailers Do Amid Coronavirus Outbreak?

Shah says that changes in shopper behavior can be hard to predict, as it’s all circumstantial with the unprecedented evolution of the outbreak. As the guidelines for social distancing have been extended for a month, we don’t know exactly what people will buy to sustain themselves during this time.

However, Shah advises, “Trust and rely on buying and supply chain needs and let experts be experts.”

For retailers and ecommerce to get through the coronavirus crisis, Shah emphasizes three pillars:

  1. Reliability – continue to provide care and service to your customers to support them 
  2. Online Sales – have an online focus to reach new customers and deliver to those who are actively social distancing
  3. Community – your community involves your customers and associate team members who keep your store stocked.

Shah says, in regards to community, to continue “making a difference for people you operate with.” In New Jersey, Shoprite offered trailers for makeshift hospitals to aid governmental and local law enforcement.

When the coronavirus crisis is over, succeeding in these pillars will win the trust of customers. “We all know you cannot put a monetary value on trust,” Shah concludes. 

How Will Social Distancing Continuing into April Impact Retail Ecommerce Sales?

In the United States, President Trump recently announced an extension of self-quarantine to April 30th. We don’t know when retail stores will open. But NetElixir can offer some forecast into the continuing the impact on online shopping behavior and retail ecommerce during the coronavirus outbreak.

The impacts of the coronavirus outbreak could extend far beyond the ends of social distancing. Shah thinks that, as people realize eating at home can be a healthier and cheaper option, that there can be behavioral shifts in food consumption.

Grocery and food shopping during coronavirus
After the coronavirus outbreak calms down, we may see a change in overall shopping behavior, especially in people’s relationship with food. Photo by Artem Beliaikin from Pexels

Shah’s story supplied context to our data. We found that frequent buyouts of instore products led people to turn to online ecommerce stores for food orders and deliveries. Online conversion rate for Food ecommerce sites increased over 200%. The AOV for the Food retail category has continually increased as the coronavirus outbreak continued to spread. As people remotely learn and work, they eat more meals at home. 

NetElixir forecasts the food retail sales will increase 150% in the month of April, when compared to April 2019 data. 

As shoppers adapt to the new normal of online retail, most categories are experiencing a double digit percentage year over year online sales growth. The outset of the coronavirus outbreak saw panic buying within the first two weeks. During week three, the average order value (AOV) continued to increase, but the number of items in carts stabilized. People seem to be more willing to spend on other categories to fulfill their time at home while social distancing. We have seen a rise in sales for DIY tools, hobby products, gardening, gifting, and more as the coronavirus contines.

Additional Insights for Retailers

An interview by New Jersey Tech Weekly with NetElixir’s Founder and CEO Udayan Bose looks into how the coronavirus is impacting ecommerce sales and shaping online consumer behavior and

While we have covered an extensive dataset, it is by no means exhaustive. If you are interested in discussing specific insights for your category, please email us at shareinsights@netelixir.com

We will continue to monitor the impact of the coronavirus on online shopping behavior and ecommerce sales. Get the real data on the covid-19 impact by registering for our third installment of our coronavirus updates series. This webinar will air Thursday, April 9 at 2 PM ET. Register for our live webinar.

Our data is pulled from real-time customer paths to purchase during the period of outbreak, providing a gauge of immediate consumer behavior. NetElixir knows that one insight can change everything. All our insights are powered by LXRInsights, our proprietary analytics tool that tracks real-time data. You can request your free demo of our tool here.

You can catch up on our prior webinars from March 11 and 26 here.

For further reading, you can see our prior retail analytics updates on retail ecommerce and online shopping behavior: