When given the choice, customers are more likely to sacrifice convenience (quicker delivery time) for lower fees, according to shopper behavior research from Mercatus, a grocery digital commerce platform.
"If you are a grocery delivery customer–especially one using a third-party marketplace–it’s understandable that you may want to find ways to pay less given inflation’s impact on purchasing power,” said Mark Fairhurst, VP of marketing at Mercatus, in a statement. “These incremental costs, including delivery fees, shopper service charges, fuel surcharges, and even a very modest tip, are some of the last things customers view during the checkout stage, and they can add $20 or more to the bill.”
The research also found that one in five households in the U.S. used online delivery services in the last month. The top two reasons cited for not using grocery delivery, tied at 62 percent, are because the consumers prefer to select their own fruits and vegetables and because they do not want to pay for the extra charges, fees, and tips.
“Grocery customers don’t want to pay more than they must, and the explicit fees that come with online delivery are a big speed bump,” said Sylvain Perrier, president and CEO of Mercatus, in a statement. “Other aspects of this research reinforce that grocery customers shop regional grocers for different reasons than big-box mass retailers like Target or Walmart. Being more convenient is the main reason customers prefer Grocery over a Mass retailer, followed by the quality of the products they want to buy.”
Further research found that when presented with a fixed fee of $9.95 for orders over $100, over 30 percent of customers preferred to receive the order within 30 to 60 minutes, while 40 percent selected to receive it within 1 to 3 hours. When offered a variable fee, however, the share of shoppers choosing 30-to-60-minute or 1-to-3-hour windows decreased by over 50 percent.
Mercatus’ research on shopper behavior is the first of a three-volume series, the next of which will focus on what drives shoppers to choose grocery pickup.
Related: Food Delivery Demand Wanes; As Grocery Prices Swell, Restaurants Offer Value