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Shopping for grocery and everyday household products is an integral part of life. In India, buying from a nearby kirana store (small retail store in the neighbourhood in India), ordering products via phone call from the kirana store, picking up groceries from the supermarket are some of the methods adopted by consumers for grocery shopping. The retail market for grocery in India is currently growing at a rate of 10% CAGR (Compounded Annual Growth Rate) which is about the size of 400 billion dollars. Online grocery accounts for only 0.1% of it. However, it is expected to grow to 10 billion dollars in the next 4 years and significantly be concentrated in the urban areas of India. With changing time, consumers have started becoming technology savvy, resulting in widespread use of Internet and mobile phones (Ravish, 2017). E-tailers have identified an opportunity to reach consumers via the online platform, thus beginning the era of online shopping in India. The food and grocery (F&G) market has witnessed the entry of many online players, but over the years only a few have remained operational. However, statistics suggest the growth to increase in the next few years (Thmmiya & Kulkarni, 2017). The online grocery portals provides to prospective customers features such as comparative and competitive pricing, deals and coupons, home delivery options which are otherwise rare in grocery stores. According to a Nielsen survey (Terron, 2012), the urban and affluent consumers in India have opted for the e-commerce as an alternate means of shopping for many such advantages. This digital platform has provided the Indian customer the product, service, query resolutions, content all under the same umbrella of digital shopping.
Grocery market growth in the online space presents a challenge for supermarket chains competing for share, where their investments in online and offline need to be balanced (Francesca & Rettie, 2009). Earlier research related to internet grocery shopping has concentrated on comparing online and offline purchase behaviour in various ways like the importance of brand names (Degeratu et al., 2000), brand loyalty (Danaher et al., 2004), shopping pattern (Andrews & Currim, 2004), and consumers’ perceptions of the advantages and disadvantages of online grocery shopping (Ramus & Nielsen, 2005). Study has also been conducted on consumer traits of internet shoppers, either in terms of their general shopping orientation (Brown et al., 2003) their web-usage-related lifestyle (Brengmen et al., 2005), or psychographic characteristics (Barnes et al., 2007). Additionally, literature (Rohm & Swaminathan, 2004) has attempted to develop a typology of internet grocery shoppers, based upon motivations for shopping online.
Another Nielsen survey (Swedowsky, 2009) evaluated the parameters that drive increased consumer interest in online grocery shopping. Convenience, selection, and savings have been stated as primary reasons for choosing online grocery over store shopping. Shipping costs, inability to inspect perishables, and having to wait for deliveries to arrive, have been mentioned as disadvantages of online grocery shopping. There is a significant number of people who continue to shop from stores in-person and have not yet experienced online shopping. Reasons stated have been the habit and preference of the individual or insufficient means to use it due to lack of awareness/availability of online grocery options.
There is opportunity for growth of online grocery shopping due to the following reasons: