Breaking the big store barrier in automated grocery

Online grocery is great, but merging digital with the physical is better

The idea of standing in line at a grocery store is something that most people loathe and dread, even without a global pandemic around. Fortunately, over the past 20 years, technology has freed us from standing in line at many customer-facing places -ATMs instead of banks, self-check-in kiosks at airports, or renewing one’s driver’s license online. However, despite game-changing innovation in the last couple of years, grocery stores and standing in line remain intricately linked in most people’s minds.

While 2020 saw a significant rise in groceries being ordered online due to Covid-19, the business model remains unprofitable to retailers. A study by Bain estimates that companies that use staff to fulfill online orders and deliver them lose 10-15% on every order, depending on delivery fees. 

Furthermore,  a McKinsey survey indicates that although consumers feel very satisfied with online shopping, they view it as a temporary measure and plan to return to physical stores once possible. The survey covers five European countries, and the only country where consumers expect to increase their online grocery shopping is in the United Kingdom, with a net intent of +5 percent. McKinsey foresees a shake-up among grocery players as they battle for consumer loyalty. For retailers, that means that now is a critical time to invest in retaining their newly gained customers.

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