Food vs Non Food eCommerce

Food vs Non Food eCommerce

Online grocery retailer is very different from a General Merchandise or rather Non Food Retailers.  Let’s see some of the subtle/substantial differences between online grocery and other category ecommerce sites and its impact from systems perspective. Following are some of the unique features of a grocery website.

Repetitive buying behavior vs. less frequent buying

Grocery customers are repetitive buyers because of the nature of goods being brought. So, it means that a grocery customer when he visits your site to buy, he expects that you recognise him, provide necessary discounts, remember his orders etc. When compared with a person who wants to buy a Digital Camera or a book online, the grocery customer needs more attention.

System Impact – You need to provide features such as Shopping Lists, Ability to order directly from the previously stored Shopping list. You also need to provide more personalized service and features to enable him to keep visiting you again. Some sort of loyalty programme would be helpful.

Large Basket Size vs. Small Basket Size

Typically, a grocery basket is huge, again because of the nature of goods being brought. This means that your systems needs to cope up with huge basket sizes (in the order of 100’s of products) as opposed to a single digit products for any other Retailer.

System Impact – Design your cart to hold multiple items. You need to provide multiple entry points to the cart such as being able to add all items to cart from previously saved Shopping lists.

Delivered from a nearby Store vs. Delivered from a Warehouse

Grocery items (especially perishable goods) are not stocked and delivered. In general, grocery goods are delivered from a store nearby to the customer while the non-food goods are picked, packed and dispatched from a Warehouse.

System Impact – Customer is asked for his post code or sometimes has to register before he buys grocery goods. Stores systems need to be integrated with your centralised, online website so that they know about the orders to be fulfilled.

Payments will have to be reauthorised and final payment authorisation done on delivery

Product Substitutions

As the fulfillment happens from Stores, in grocery, one cannot ensure that the product is available for sure at the store. So, one typically provides a substitution. Some retailers go to the extent of capturing customers accepted substitutions before hand so that there are less number of product rejections.

System impact – Model substitutions based on product category, products. Picking systems should be made aware of these substations, especially if the preference on substation is captured from the customer.

Allow orders to be updated with substations. Payment process to be allowed to re run to ensure right and accurate payment is done.

Infinite Inventory vs. Finite Inventory

Grocery products are normally assumed to be infinitely available as it can be fulfilled either through a substitution or by getting it from nearby store or from the marketplace itself.

Systems impact – No need to for any real time inventory check before you place an order. While, in non food (say for example: a digital camera or a laptop), inventory check becomes very important as the retailer has to be absolutely sure if he can fulfill his promise to the customer with respect to delivering the right product at the right time.

There are quite a few subtle differences other than the above. This is only a snapshot. While this is purely from Food perspective, I think I will write one more from Non food perspective. i.e. uniqueness from Non Food perspective. Maybe next month…

2 Comments

  1. Anoop says:

    A very nice post Harish.. some interesting points that also needs dwelling is – the process of returning goods in case of grocery. There is typically no warranty concept, and especialy on perishable goods this could get tricky..

  2. harish says:

    Thanks Anoop.

    Normally, in Grocery, returns are done on delivery. Many don’t accept returns post delivery. I guess that is one way of addressing the perishable goods problem.

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