If I’d read the Vision 2021 Trend Report a year ago, I would have assumed it was an outlook of online shopping habits in 2035. So much changed in 2020, with the pandemic delivering unprecedented growth and sorrow at the same time. Now, I view the future from a very different perspective.
As the CEO of a recipe shopping technology that powers media brands, the Vision 2021 Trends Report makes total sense. We live in a completely different world; one where COVID has turned digital into our primary and preferred way of engaging with the world. Consumer habits have leaped well ahead of where experts thought we would be, under normal circumstances. Brands are constantly evolving to match the pace of new consumer expectations and habits: if they don’t evolve and adapt, they will be left behind. In 2020, that evolution picked up the pace significantly.
One of the industries that has seen the most rapid transformation and growth as a result of the pandemic is the grocery industry. Online grocery experts have seen five years’ worth of innovation over the past year. eMarketer’s senior forecasting analyst at Insider Intelligence, Whitney Birdsall, observes:
“The pandemic pushed consumers to search for a safe and convenient way of getting essential grocery items, and many retailers adapted to that demand. With the growing number of stores offering curbside pickup and an increase in features offered by grocery delivery apps, consumers are now presented with a variety of incentives and options to order their groceries online.”
This rapid growth has certainly had its challenges. Panic buying and stock replenishment issues left shelves empty. The massive rise in online orders meant there were no delivery slots available. Tens of thousands of workers entering into online fulfillment led to already-negative margins become even more light.
But there have also been many positive effects as a result of this transformation. Positive habits are forming as people shop in new ways. eMarketer’s Witney Birdsall is right to point out that,
“A large portion of consumers who became first-time online grocery buyers during the pandemic now prefer this mode of grocery shopping due to convenience.”
Behavioural science says that new habits form after two months of repeated behaviour and that the habit will stick if reinforced with positive effects. In reading the Vision 2021 Trend Report from a grocery perspective, it corresponds so well with what we’re seeing in the rapid evolution of the industry. Three areas of the report particularly resonate with me due to their significance:
1. Shopping is Entertainment – grocery shopping as a social activity
Shopping is entertainment. I love this quote: “Online shopping needs to be more Pinterest than Shopify!”
Shopping is a group activity – a social activity. But is grocery shopping as a group activity a chore (when you’re in a hurry in the store with your kids, for example) or a welcome chance to explore (trying out new flavours at the deli counter with your partner)?
Buying groceries online has plenty of scope for making the shopping experience more entertaining. Families can share shopping lists and recipes as they plan their meals and treats for the coming week. At the same time, auto-replenishment functionality can help to deal with all of the boring stuff that we need – the household cleaning products, pantry ingredients, standard products like milk and butter.
Retailers need to look carefully at how they interact with people. Consumers are relocating experiences that they once had in restaurants (and bars and clubs and all manner of other places) to the home. The kitchen is where they engage with the shopping experience now. Shopping has gone from being an activity undertaken with people and for people to something isolating and overwhelming.
This is where brands can win big. In all of its optimization, the retail sector has lost the opportunity to build relationships with the people that we interact with on a daily basis. The more mass-produced and commercialised consumer brands become, the harder it becomes to win loyalty and reoccurring consumption based on personal interactions.
2. The Product Eternal
In the new circular economy, consumers are far more conscious about the brands they buy from, looking at everything from eliminating waste to the continual use of resources. It is great to see sustainability taking a step forward. Brands are looking at this more closely in their annual reports and featuring it on the homepages of their websites. The impact that brands have on society matters, but so does the impact that society is having on brands.
Major brands, such as Coca-Cola, are listening to what consumers are saying and having to innovate fast. It is one thing using recycled plastic or cans. But in reality, consumers want to eliminate the use of plastic altogether. It’s encouraging to see tests with recycled paper bottles instead of plastic. This kind of innovation will continue at speed over the coming months and years.
The meal kit industry faces the same scrutiny over its use of plastic. Regardless of industry, the future needs to be sustainable. When it comes to food, consumers care increasingly about where produce comes from. Is it non-GMO or organic? Is it sustainably sourced? What jobs did it create? Do growers receive fair pay?
The industry is also dealing with changes in consumption habits, such as the rise of veganism, leading to the rise of companies such as Upfield, a major player in the plant-based CPG space. Key to this ‘product eternal’ theme is listening to what customers want. Retailers need to anticipate their needs and work in collaboration with consumers. They need to have the courage to disrupt.
3. Brands and the Widening Class Schism
Some consumers prefer shopping in vast marketplaces; others prefer smaller, local brands. It’s no different online, where small companies compete with huge marketplaces like Amazon and Walmart. Maybe this is a class schism but ultimately those lines are being blurred; consumers have a choice.
The advancements in technology and shift in consumer habits will open up new opportunities. Consumers will be loyal to those brands that deliver seamless experiences that meet their needs.
What we’re seeing, across the retail spectrum, is brands becoming homogenized, just as Ben Schott described in his oft-quoted piece for Bloomberg, ‘Welcome to Your Bland New World.’ Ultimately, this means that brands need to position their products in the context of solving shoppers’ problems. Just selling the premium mayonnaise won’t cut it; the brand needs to put that product in 50 different contexts where it would make sense for the shopper to buy it. The Selfie Complex is then pushing consumers to buy whichever products are associated with the mayonnaise.
We’ve actually looked at this in Europe. We found that shoppers keep 98.2% of items that are automatically put in their cart from a branded recipe. As such, owning the narrative where brands present their products, will lead to conversion and ultimately brand preference.
For me it's less class, it's more widening the gap in who can deliver the best experience.
- The opportunities for innovation right now in the online grocery retail space are huge.
- Attitudes and behaviours are shifting, with sustainability and ethics in sharp focus.
- Living with tech all around us is playing into brands being discovered in new ways while driving consumer loyalty.
Erik Wallin is CEO and co-founder of Northfork (northfork.ai), the recipe shopping technology powering the Walmart recipe shopping experience within the Tasty app.