It turns out that the biggest driver of ecommerce success in the grocery world, appears to originate with return customers, according to the industry consulting firm of Brick Meets Click.
It was long-term, established online grocery customers who collectively generated more than 3.5 times the revenue for conventional grocers than new customers, found a study sponsored by Cardlytics, Mercatus and Hussmann.
“Grocers need to build more meaningful engagement with their online customers,” explained David Bishop, partner at Brick Meets Click.
The more established customers, those who have shopped online with a grocer for over 60 weeks, spent 2.4 times more than new customers who started shopping within the past four weeks.
Relationship dividends are generated by increased order frequency and spending per order. Comparing the two customer cohorts quantifies that the more established customers’ order frequency is 1.9 times higher than for new customers, and their average order values are 1.3 times greater.
Most customers have strong preferences when receiving online orders from conventional grocers. When given the option, fewer than 5% used both pickup and delivery services from the same grocery brand during a 12-week period studied in 2021. So, if a grocer only offers one receiving method, it could be sending the 54% of shoppers who prefer delivery and 42% who prefer pickup to a rival.
Attracting new customers is important, but nurturing existing ones is essential, BMC stresses. During the study, 34% of online customers had used the grocer’s service for 60 weeks or longer and accounted for 46% of overall online sales, while 23% of customers who placed their first order with the grocer accounted for just 13% of sales.