« Should unpaid internships be allowed? | Main | Are 'pet-friendly' hotels really worth the extra money? »

October 21, 2021

Buying your groceries online could become the norm

Walmart Canada is foraying into a new retail sphere, the world of selling food online.

The discount store quietly added food options to its website, which include items such as canned soups, pancake mix and gluten-free cereals, according to the Globe and Mail. The store typically has free shipping, except in the territories, and it's testing same-day shipping in Toronto. They could even offer fresh and frozen product options in the future, a spokesperson told the newspaper.

Many stores have shifted their businesses towards creating a robust shopping website as consumers have taken to showrooming, which means they check out the item at a brick and mortar store and then research on the Internet, sometimes even while in the store, for the best price.

While Canadians aren't as likely to shop online as other nations with 22 per cent of Canadians having never bought anything online, which is a stark contrast compared to four per cent of residents in China never buying anything online, more and more retailers are realizing that they need to grow their brands on the Internet.

Online grocery shopping was rumoured to be the next big thing during the '90s with people likely appreciating the convenience of having their groceries dropped off in front of their doors.

While it's common for people to research groceries before heading out to buy them, whether it's to find a coupon, compare prices or use a shopping list, there aren't many options in Canada that let customers have groceries delivered to their doors.

Selling groceries online is different than selling electronics or toys. It needs a different business model that requires food to be shipped on time, but it also needs to stay fresh. It also needs to take account the different grocery shopping trends around the world. In North America, 60 per cent of consumers are more likely to stock up on food staples, such as bread or milk, while in Europe, only 37 per cent of consumers stock up on food staples and 21 per cent of them go grocery shopping when they need an item, according to report by Nielsen.

Britain is one of the few countries where online grocery shopping has gained traction. One fifth of Britain's residents buy their  groceries online every month, one third of those residents shop online regularly, according to IGD, a consumer goods industry research and education charity. That sector will continue to grow thanks to lower levels of car ownership.

In Canada, there are retailers banking on the online grocery shopping industry taking off. Grocery Gateway was floundering until it was bought by Longo's, an Ontario grocery chain, in 2004. It delivers to Toronto and the surrounding areas, such as Kitchener, Waterloo and Guelph, and the website recently teamed up with Steam Whistle Brewing to add beer to its list of deliverable groceries.

Amazon recently announced that it was expanding its same-day, grocery delivery business to Los Angeles and the San Francisco Bay area after testing it for years in Seattle. If all goes well, the company is looking at launching the service in 20 cities by 2014, according to Reuters.

Walmart is also testing an online grocery service in San Francisco and it currently operates a service in Britain.

It looks like the online grocery shopping game is afoot and in a few years, it might very well take off.

Would you buy your groceries online? Why or why not?

Josephine Lim, MSN Money      



Post a comment


Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...