And so, it is just the next step that we even start buying our daily groceries and groceries online as well!
online grocery store
Online grocery stores have become the next big thing in the world of eCommerce Marketplace Business.
What is an online grocery store?
As for the definition, an Online Grocer is nothing more than a traditional supermarket or grocery store that allows ordering via the Internet. It was made possible through -
Whether it was on their own new zealand phone number library website or another eCommerce website or even through a mobile app. This made the lives of common men, especially the working class, much simpler as all they had to do was select items and pay for them online without the long and messy checkout queues.
Post this, they could pick it up themselves by visiting the store on their way home or have it delivered to their doorstep if that store was within the store's geographic delivery radius.
When a survey was conducted from the customer's point of view about online shopping at the supermarket, this was the result:
online grocery store result
How to set up your own online grocery store?
This concept is not new, Webvan and HomeGrocer.com were launched back in the 90s.
They even secured large investments that allowed them to create the infrastructure necessary to support the business, including warehouses and a fleet of vans.
Its initial growth seemed extremely promising and by mid-2000 sales had reached over $1 million per day.
But where are these online stores now?
What was the reason for his downfall?
Here are some of his crucial mistakes:
They overestimated the profit margin on online orders.
In a traditional grocery store, the customer comes to the supermarket, picks up the products themselves and takes them home.
But that is not the case in online stores. The seller picks products and delivers them to customers . Unfortunately, customers are not willing to bear the cost of shipping and handling fees.
This results in relatively lower profit margins.
Companies did not consider ROI.
The fact that while the grocery sector generates high sales, its margins are low; that is, the returns on huge investments are extremely slow.
The rapid expansion had a negative impact on their balance sheets.
The impact of an online grocery store was overestimated.
As with most predictions about online stores back in the 1990s, the impact of this online business model was seriously overestimated.
They believed this would revolutionize the industry, but they were wrong. This represented just over 0.09% of all online grocery spending, which was nowhere near what the startups had estimated.
So, taking these lessons as precautionary measures, let us now look at how to set up an online grocery store and operate it efficiently to make considerable profits.
What you need to prepare:
Plan and strategize your online store business
This is the foundational step of your business. This phase takes up most of your time, as this is where you plan your entire business model and operational details.
You also need to consider all the factors involved in the delivery of food items such as their shelf life, perishability, durability and many more.
Below is a graphical representation of the basic business model you can follow for your online grocery store business.
online grocery store strategy
There is always room to improvise and customize it to your needs.
Analyze your competitors
There is always something to learn from your peers and counterparts. Since many have already set foot in this field, you can study their methods, tactics, etc.
You could do a SWOT analysis on them and use that data to understand and develop your business.
Find your niche
Setting up your business can be a difficult task as the market already has popular and well-established grocery stores.
Hence, you will have to do your research and plan in such a way that you stand out from the rest.
For example, you can focus on a single product category and sell more fruits, grains, or vegetables instead of selling every item out there.
Partner with trusted grocery suppliers
Since you are just starting your business , it is best to start with smaller geographic locations. Conduct extensive research and analysis and focus on the best partners available.
The main supplier partners required for the online grocery store business are:
Delivery Partners
Wholesalers and
Farms
Warehouses.
Grocery stores
Develop your application
Once you are sure of all the documentation you need to create your online grocery store, it is time to bring the app to life. There are three main ways you can create your app.
Build it from scratch:
On your own or
Hire a capable technical team
Use a SaaS platform
Buy an Instacart Clone Script
Choose the most suitable method based on your investment capacity. You will definitely have a budget, a timeline, and a plan in mind. Judge which one best suits these three conditions and go for it.
Once you have created your app, you will need to monetize it. You can implement any of the following methods for this purpose.
How to monetize your online grocery store?
Commission-based monetization
For every order your partners receive, you can set a certain percentage as a commission. This monetization model will also help accelerate your growth.
Subscription-based monetization
This is a model where you charge your customers a fixed and recurring subscription amount. To make this plan seem more attractive to your customers, you can also add some discount vouchers, or free delivery access for some orders, and many such innovative offers.
The hybrid solution
The best of both worlds. You can charge your partners a commission and your customers a subscription fee.
This is the model that most successful online grocery stores use.
Launching your app is the final and most important step. You will need to incorporate eye-catching offers to attract the crowd. And personalization is the key to a successful launch.
Here are some tips you can work on.
Provide some innovative recipes.
Add additional discounts and offers if there are referrals from friends/family
Enable an option where they can upload a list and automate it to be delivered periodically.
Add a feature where they can share a cart with other customers.
How to use digital marketing for your online grocery store?
In the current pandemic situation, this service is in high demand. Make sure you make smart and optimal use of this opportunity and carve a niche for yourself in the eCommerce business world. To help you with digital marketing, here are some tips.
Select your target audience
This is one of the crucial parts of growing your business. Knowing who your product is perfectly suited for is a crucial part.
Researching and understanding their lifestyle, demographics, and interests will help you design and develop your marketing plan targeting those areas.
This provides good content marketing strategies, opens strong communication channels and creates a better representation of the brand message.
Social Media Marketing
Social media has become a huge platform that connects people around the world and is one such platform that provides international visibility.
If used correctly, you could also use this platform to drive traffic to your online grocery store website.
Some of the most used social media platforms are Facebook, Instagram and Twitter. Create an account and make yourself visible to the social media family.
Create unique content, eye-catching graphics, and aim to capture your audience’s attention. This has been proven to be one of the most effective ways to increase your customer base.
Influence Campaigns
In today's times, people are more interested in researching a product through reviews, ratings, and gaining information through other people's experiences.
Leveraging social media influencers is a great way to create a digital marketing strategy.
Getting an influencer to talk or demonstrate your app’s website will definitely grab the attention of their followers and thus help convert these viewers into potential customers.
