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Opportunity in The Digital Grocery Aisle: 5 Strategies to Help Brands Increase Sales

 

By Robb Powell

 

More than half of internet users — nearly 55% — are expected to purchase groceries online this year and a hybrid in-store/online approach is expected to be the dominant model for the future.

 

Many brands, however, aren’t taking full advantage of the growing online opportunity. Here are five strategies to optimize sales across digital grocery shelves:

 

1. Explore regional and smaller grocery.coms.

 

As brands strategize how to best capture sales in this dynamic marketplace, they should consider not just the digital leaders and big box retailers, but the huge potential across traditional grocers and regional retailers and coordinate their online and in-store marketing efforts with these partners, too. While some of these regional and smaller grocery retailers may have gotten off to a slow start online, most are investing in and optimizing their online platforms with better search capabilities and other features to improve customer experience and drive sales and profitability.

 

Many next-tier grocery chains now offer a positive customer experience online — some are even outperforming much larger retailers — and offer brands a chance to stand out in a less-crowded marketplace. For instance, in the areas of research and discovery (on-site search, homepage layout, navigation and content), top-scoring U.S. retailers include not just Target, ranked first in this area., and BJ’s Wholesale, ranked No. 5 by Incisiv’s “2020 Grocery Digital Maturity Benchmark Study,” but regional player Brookshire Grocery Co. (tied at No. 5). Brookshire’s also tied with BJ’s at No. 2 globally in ease of online ordering (checkout process, convenience, product assortment and other features), behind Target and ahead of Tesco and Publix. Looking at fulfillment capabilities, Walmart, with its strong availability and execution of pickup, leads the pack, followed by Kroger, Publix, Costco and regional player Wegmans.

 

2. Create customer-specific digital content.

 

After selecting the best grocery partners, brands can pursue targeted onsite search, promotion and advertising, all of which have a significant impact on sales, brand awareness and customer experience. It starts with ensuring that the brand’s assets — high-quality images, complete product information and possibly videos — are available and easily accessible. An online digital campaign should reinforce brand standards and align with in-store and other efforts to provide a seamless experience to the shopper.

 

Optimal customer-specific digital content:

 

  • Delivers high-quality content and useful brand information
  • Is managed to leverage retailer algorithms
  • Can evolve with changing platforms and tools
  • Positively impacts consumer engagement
  • Mirrors messaging being used across retail in-store and digital media campaigns
  • Aligns to brand positioning and voice
  • Includes key value messaging

3. Focus on digital assortment and availability.

 

If there’s no alignment between product availability and how or if products show up on a shopper’s screen, brands will lose sales and customers will be frustrated. Each retailer has its own policies about which products appear online, so it’s important for brands to understand the policies and how to influence how their products are presented.

 

For example, a retailer might have a policy to not include seasonal items in the online mix. But some brands, such as candle manufacturers that offer holiday-themed or seasonal scents, are highly dependent on seasonal sales. By staying in close touch with grocery chains, brands can have more influence over how seasonal products are treated.

 

Key factors in harmonizing digital assortment and availability include:

 

  • Auditing and understanding the current digital assortment at each retailer
  • Comparing the online offer to the brick-and-mortar offer​ and implementing a sales strategy that encompasses both
  • Identifying gaps and incremental seasonal opportunities to influence retailers’ online policies
  • Resourcing ongoing maintenance and monitoring

4. Amplify your presence on retailers’ dot-coms.

 

Because the great majority of conversions happen on the first page of search results, brands and specific products must be promoted or dominate the search results so that shoppers will see and click on them first. These search optimization efforts should be paired with in-store strategies and executed seamlessly so that shoppers can easily and intuitively make their purchases.

 

Brands should also consider how their products are categorized and work much more closely with retailers on their keyword strategy, something that’s not happening regularly.  For example, shoppers may type in “butter,” but are using it as a catchall term that includes margarine and other dairy or nondairy spreads. For that reason, a margarine brand will want to have its products also appear under “butter.”

 

To amplify products on retail platforms and in digital media, brands should:

 

  • Monitor and strategically manage both paid and organic product search results
  • Develop tailored activities for each retail platform that impact share of voice and performance
  • Coordinate onsite and offsite merchandise and media campaigns to communicate with targeted shoppers during key shopping moments to maximize conversion
  • Optimize digital content through the inclusion of mobile-optimized imagery, concise titles and product descriptions that highlight the product’s value
  • Manage promotions and sampling campaigns to align with business KPIs
  • Ensure consistent messaging, event timing and SKU selection across in-store and digital campaigns

5. Leverage data and analytics.

 

Many brands have a surprising amount of difficulty getting visibility into the details of their online sales metrics, but it’s worth the effort to gain access and work through the complexity of extracting insights, which vary by retailer, because the data is a treasure trove of critical information. Used effectively, data and analytics can help pinpoint problems with digital promotion and advertising and provide insights into inventory and out-of-stocks.

 

To get the most from available data, brands should:

 

  • Manage customer-level ePOS (where available) and leverage e-commerce sales analytics tools and outside partners who can execute the findings
  • Cohesively manage online and in-store sales measures to impact the total business model with meaningful trends and insights
  • Ensure alignment to retailers’ changing strategies, business goals and KPIs
  • Track efforts and business metrics impacted by e-commerce optimization to maximize opportunity

As online grocery shopping continues to grow, brands have a huge, untapped opportunity to optimize marketing and drive sales and profitability through a coordinated in-store and online strategy, one that better aligns with shoppers’ still-evolving buying habits across retail platforms.

 

Learn how Advantage Sales and Advantage Digital Commerce have partnered on a unique digital shelf management strategy to help brands optimize sales online.

 

Erin Heikkinen, senior director, e-commerce strategic consulting for Advantage Digital Commerce, contributed to this blog.

 

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