E-retail is a growing trend across all industries, including F&B. The recent acquisition of Whole Foods Market by Amazon has signaled a new phase in online grocery shopping.
How will the e-retail landscape evolve in the near future? At the 2017 Future of Nutrition conference we were joined by a panel of experts to discuss the impact of ecommerce on the food and beverage industry in the future and the changes in consumers’ approach to nutrition. Below are some key takeaways from the discussion.
Power plays in the shifting e-retail landscape. Online retail has opened up the market to smaller players, however at the moment big brands are still dominating thanks to greater reach in ad space and over indexing. Start-ups on the other hand, have to build their own brands and develop their own presence online. At the moment it seems like the big brands are winning, but when you look at the success of emerging online companies such as Hello Fresh, retailers are starting to view these smaller companies as threats.
Personalisation in nutrition and retail. Personalisation is a buzz word in the industry at the moment. Personalised nutrition is changing consumers’ approach to food purchasing decisions by making them think more about the impact of nutrition on their personal health. At a retail level, we are seeing personalisation in the way people shop. For example, families might shop differently than single person households and some people prefer to do online shopping with a trusted retailer whilst others experiment with grocery boxes and meal delivery services.
Sustainability: traceability, authenticity, consumer trust. Again, this is another pervasive trend across the industry. As consumers demand more information about the origins of food they eat, there is an opportunity for companies to offer tools and technologies that can better inform consumers about the food they are buying, e.g. barcode scanners linked to online databases which allow consumers to trace the production of the food they are buying. It’s all about making data available.
Growth of data: Dangers and opportunities. With the opportunity to make more information available to consumers come certain opportunities and challenges. Consumers today want to become more informed about the products they are purchasing, particularly when it comes to food and nutrition. They are also quite lazy and prefer to choose ‘the path of least resistance’ when it comes to finding this information. Those companies who are willing to make more data accessible will likely win out. However, with growing demand for trust and authenticity consumers will probably prefer to select information from impartial sources. How might this sharing of information be organised?
A shift up the value chain: Retailers acted first in e-retail as they have traditionally been closer to consumers, but now players further up the value chain are having to respond. What new business models are likely to evolve as a result? And how should finished product manufacturers develop their online B2C marketing to capitalise on this opportunity?
Opportunity for the industry to support consumers in living healthier lifestyles? Health and wellness is growing increasingly important for consumers. As they begin to proactively inform themselves of the benefits and dangers of different food types, there is a real opportunity for retailers and finished product manufacturers to play a role in providing the services and tools they need to make informed decisions. If retailers and food industry players develop online platforms to connect with health associations and communities, they can become a strong voice in the fight against non-communicable diseases.
Safety concerns and regulatory challenges. As identified earlier, e-retail opens up opportunities for smaller market players and also emerging categories, e.g. insect protein, that are harder to buy in-store. The internet has also globalised shopping, allowing consumers to easily access products that might not be available in their own countries. One big challenge with this though, is how should online retail be regulated? Is there a way to develop standardised, global regulations? Or should it be the responsibility of the retailers themselves to ensure the products they sell are safe and of the right quality?