How Americans buy nearly everything has begun to change. People no longer simply drive to a nearby store and buy what they need. Instead, most things can be ordered online, and that has impacted the entire retail sector.
The supermarket/grocery business has already felt some of these changes. Going forward, however, the pace of change is going to pick up. That means that services like same-day delivery, which numerous regional chains as well as Costco (NASDAQ:COST), Amazon's (NASDAQ:AMZN) Whole Foods, and Amazon itself offer in select markets, are likely to expand. In addition, other ideas that make shopping easier will be implemented, according to GroceryStories.com John Karolefski.
"Consumers can expect a focus on convenience as grocers make shopping easier and more enjoyable in 2018," he said in a press release, laying out some of the top trends to expect in the new year. Karolefski, who spent 15 years as senior editor of Supermarket News, has covered the grocery/supermarket business for 25 years.
What trends are coming?
More shopping options: This year, Costco added both same-day delivery through Instacart and two-day delivery for orders from a limited number of items on orders over $75. In addition, Wal-Mart (NYSE: WMT) and Target (NYSE: TGT) tested curbside pickup and various other methods to make ordering online and picking up in store easier.
Expect more of this in 2018, says Karolefski, with new ideas being tested and chains starting to see what works. There will be heavy trial and error here and what consumers want may vary greatly by market and geography.
Mobile payment at checkout: This is already being done at progressive retailers like Whole Foods. Expect other national chains to follow with some offering more than one mobile payment choice.
More eating and drinking in stores: Getting people to leave their houses has become harder. That makes expanded food selection, coffee bars, beer and wine bars, and even restaurants a major draw. Expect more chains to follow the model used by Whole Foods and, in a different way, Costco, where getting a bite to eat and/or something to drink is part of the overall experience.
More meal kits: While companies like Blue Apron may have created a market for meal kits, supermarkets are well-positioned to offer their own take. That means that chains will do everything from offering recipe cards in stores next to the needed ingredients to selling dish ingredients as a package.
This is a growing market that's based on convenience. Supermarkets can in some ways be more convenient than a dedicated meal delivery service because they offer the ability to act impulsively and walk home with what you need to make your desired meal.
More access to product information: The internet has made consumers more discerning. People expect more information because information of all types is easier to come by. Karolefski noted that companies in the food space have added scannable codes to nearly 15,000 packaged items that bring shoppers to a website containing detailed information about that item.
"A major education campaign will take place in 2018 to make shoppers aware of the codes and prompt them to scan to learn more about the food they are buying," he said.
The customer is key
Amazon has largely led the way in prompting retailers to put their customers first. The online giant has relentlessly moved the bar when it comes to convenience and pricing across a variety of retail areas. Now that it has its sites set on food -- both through its own Amazon Fresh service and Whole Foods -- expect it to push other grocery chains to be equally innovative.
In addition, Wal-Mart and Target have both recently purchased logistics companies, at least partly to help with figuring out the grocery business. Those big players, trailed by Costco, will push regional supermarket and smaller grocery chains to innovate as well, with customer experience and choice at the forefront.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Daniel B. Kline has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends Costco Wholesale. The Motley Fool has a disclosure policy.