Amazon Set To Shake Up Australian Online Grocery

Amazon Set To Shake Up Australian Online Grocery

Nielsen’s syndicated Grocery E-Commerce Report for the third quarter of 2018 reveals that online grocery shopping has grown significantly, increasing by 39.7% in value sales during the 12 months to October 2018 versus the prior year. In comparison, the total grocery market grew just 2.7% in the same period.

Online grocery now accounts for 3.8% share of total grocery dollar sales – up 1.0 percentage point in the last 12 months. And it is expected that the rapid growth of online grocery sales is expected to continue as Australians get more comfortable and experienced with online shopping. These weeks leading up to Christmas will undoubtedly see a surge in new shoppers’ trialling online grocery stores for their ‘big shop’ during this busy period,”

Coles and Woolworths continue to be the major players in the Australian online grocery space, representing approximately 85% of total online grocery value sales. However, Australians’ interest in Amazon and the expansion of available grocery categories Amazon now has on offer, is set to shake up the online grocery landscape.

Household brands from across dry grocery categories, such as biscuits, cereals, and confectionery can now be purchased via Amazon, as is a range of health and organic items which may attract customers looking for specialty items they may not have seen in their local bricks and mortar stores.

Young Transitionals Lead the Growth Online

‘Young Transitionals’, defined as households younger than 35 years old with no kids, has the greatest share of online grocery buyers and this group increased the amount they spent online by 94.4% in the last year. ‘Small-Scale Families’, households with children aged between 6-11, also grew by 44.9%.

In terms of items bought online, frozen food, specifically frozen meals, ice cream and frozen vegetables, and confectionery continues to be the leading categories for online sales growth, both recording 57% growth in the last year. These are followed by dry grocery, with 48.5% growth.

Health and beauty remains the grocery department attracting new shoppers at the fastest rate. This could be attributed to the simplicity and convenience of purchasing necessities, such as toothpaste and deodorants online.