Challenges of Online Grocery Business: 10 Ideas You Should Consider to Survive

The online grocery industry has always been considered as a fruitful, profitable, and attractive industry to business owners. Therefore launching an online grocery store has become quite a popular option to consider for starting an e-commerce business.

However, the Coronavirus disease in late 2019 – early 2020 has revealed many weaknesses that online grocery can experience in stressful situations, such as inability of websites to deal with peak load times, complex store structure and ordering process that confuse customers, inventory management imperfections which lead to issues with products supplies, delays with delivery and more. These weaknesses negatively impact customer experiences and result in significant profit losses.

Panic caused by COVID-19 will get down sooner or later, but situations similar to this, and even more severe, may happen again and again. Thus, you and your business must stay prepared for such types of accidents.

In this article, we’ve compiled the list of the issues e-commerce grocery websites may be stuck with. We have also supplemented all problems with the solutions, which may be used as guidelines for you to solve the issues efficiently.

#1 Inability to Handle High Traffic Loads

An online store can handle a limited number of concurrent visitors. At some moment you may feel fine with the current bandwidth of your store. But rest assured that during some collapses, the number of people wanting to make a purchase from an online store instead of brick to mortar will increase exponentially, resulting in a dramatic traffic leap. Is it a problem? Definitely yes, if your store is not prepared in advance! Traffic leap can cause many problems, the most serious of which is the inability to complete the purchase. And this inevitably impacts the profits of yours.

Solution: Server tuning and store performance optimization

Traffic fluctuation won’t become an unwelcome surprise to your online grocery business if you’re well prepared. Currently, there are plenty of methods to make your store resistant. However, all these measures should be applied in advance, so don’t waste your time and find a reliable optimization service provider as soon as possible.

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The most popular and robust way to overcome the issue is performance optimization and server tuning. One of our clients came to us with the requirement to prepare his store for Black Friday. Last year they experienced enormous traffic growth during the sales and, due to this overload, the website couldn’t work properly. Many customers were unable to complete the checkout and our client strived to prevent such a situation.

To resolve the problem we’ve decided to implement a new server structure – use a separate server for the database (DB), separate for admin panel, and several front-end cloud instances behind a load balancer. Admin Panel server handles store administrators’ activity with the website and processes external incoming API requests. DB server is free of web-server loading and handles only DB requests that make it possible to have the specific configuration oriented for the particular kind of loading. Front-end server instances are protected by the load balancer and are equally loaded. The adding of a new instance happens automatically in case of massive traffic loads and takes only several minutes. As a result, the website successfully managed to serve three times more users than the previous Black Friday sale.

#2 Complicated Product Catalog Structure

Let’s face it. Generally, people are never up to get the hang of the complex structure of anything. Their enthusiasm is even weaker when it comes to online shopping during some hard times. Add stress and anxiety to their reluctance, and this will make customers leave a confusing website and go look for some more clear, streamlined and user-friendly one.

Solution: Convenient navigation and advanced search

You can actually prevent such a problem at a stage of online grocery store development via implementing clear and logical structure. Opt for simplicity when designing the departments and categories of your website, and you’ll never lose. However, if you haven’t done this before, you still can fix this problem efficiently!

This process involves many steps, such as making competitors analysis, putting together the basic insights about consumer habits, frequently bought products, most popular product categories, planning out the website hierarchy, doing deep keyword research for setting up advanced search options on your website and many other activities. For sure, you can do it yourself – for example, install and set up search extensions such as Advanced Search from Amasty and AheadWorks for Magento or Instant Search+ application for Shopify to allow your customers to find exactly those products they are looking for. However, you should take into account that this procedure may be very time-consuming and requires some technical background to be executed well. Design of a catalog structure for an online grocery shopping platform and advanced search integration can be done properly by a well-reputed digital agency with proven track record.

One of our previous clients addressed us with such a problem – he was facing a high bounce rate on the search results page. After analyzing the store, we offered several ways to resolve the problem. Firstly, we’ve recommended integrating the Algolia search which works very quickly and always delivers relevant search results. As the next step, we have reworked the menu structure and implemented a mega menu solution. This enabled organizing and showcasing all the categories in a very convenient way, so users can see all subcategories available in a specific category. And a featured product bar right on the homepage with the most popular products sold became a supporting solution in this case.

#3 Unclear Terms & Conditions

Many people may wonder if a shop continues working in their ordinary schedule during a pandemic. And if the store continues working in their normal mode or at least informs about some slight changes – this may become a decisive factor which will tip the balance in your favor.

Solution: Highlight your terms & conditions

The best solution here is to place a statement about your work conditions right on the top of your website, for example, in the header top bar. In such a way, you provide your users with clear and relevant information, without any chance to be left in the dark.

So, for instance, you can consider how elegantly Baked by Melissa, a brand that sells cupcakes, solved this issue. When the COVID-19 outbreak was recorded, the company updated its website adding a bright and bold block with a brief announcement they continue working in their normal mode along with shipping to any of the US states. Thus customers have no hesitations and can proceed making an order.

#4 Poor Inventory Management

One more source of stress for customers while they make online shopping is when part of their order is being canceled due to ordered products actually missing in stock. Quite often the root of such a problem is when products are sold both online and offline, and stock levels are not automatically synchronized between ERP, e-commerce platform, and offline store. This results in the situation when customers are misinformed about the availability of the item.

Solution: Bi-directional inventory management system integration

Disappointment grows strongly, especially if we’re talking about some stressful situations. The first thing you should focus on to prevent such a problem is proper ERP system integration with your e-commerce software. This measure will enable all the orders made offline and online to be synchronized in both directions – from ERP to e-commerce platform and back to avoid any possible divergence.

We did such type of two-way integration for one of our clients, FoneJoy, an e-store that specializes in selling cell phone accessories and spare parts. This store has 4 separate store views – for FoneJoy itself, NutelSolutions – wholesale version of FoneJoy intended for merchants, Amazon and eBay.

Here is how it works: all orders that are made on Amazon and eBay are being sent to the ERP. The FoneJoy website has a module which periodically addresses the ERP, and ERP responds with the data about the orders made on the third-party website. Then these orders are being created in the Magento platform along with actualization of the stock. In such a way, all data about orders is being stored in one single database, and information about stock availability is the same across all the storeviews.

If you’d like not to disable out of stock products on the website and show that you usually sell them, but they are temporarily out of stock now – you may like an idea to inform the customers about a shortage of the items via marking product pages with bright and bold out-of-stock indicators along with providing an approximate arrival date. For Magento, you can consider Out of stock notification solutions by Webkul, Amasty, and Magecomp. As for Shopify – you may like Out-of-Stock Police. Grab some inspiration on how to implement that visiting Unconditional store – their “Sold out” bars are eloquent and leave no doubt about pieces availability.

Additionally, you can implement the “Notify me when in stock” feature to inform customers when a desired item is in stock. We recommend you to check iHerb website to see how they implemented such a feature.

#5 Inefficient Delivery

Slow and inefficient delivery may become the source of headache even in peaceful times, not mentioning the periods of any outbreaks, collapses and troubles, when customers need their orders urgently. You can see that clearly if you take a look at numerous investigations that explicitly state the current state of affairs. Let’s say, Amazon has created a waitlist for their fresh-registered shoppers during the coronavirus outbreak, and many other e-commerce retailers are experiencing hard times about delivering orders to the customers.

Solution: Search a robust delivery service provider(s)

Сooperation with established and well-reputed delivery service providers like UPS, XPO, USPS, FedEx, Postmates, Deliv, and others is very reliable, but in hard times they may experience delays in delivery due to increased parcels amount. So if you ship orders to some small localities, you should consider integrating alternative local shipping carriers if available. This will help your orders be delivered to the customers timely. Show all possible delivery options on the checkout page to inform your clients about variants. Additionally, you can show an approximate delivery date for the most popular delivery methods. We’ve implemented such a solution for our client, HawaiiHangover.com store, that sells Hawaiian clothing and accessories.

As we have experience collaborating with ShipHawk company, a shipping service provider, that enables connection of e-commerce stores with hundreds of delivery carriers and shipping providers, and automates all processes from booking up to delivery; we are fully aware of efficiency your store can gain with custom extension development for integration with a new shipping service. As a result, e-commerce stores have an opportunity to eliminate operational overhead, increase cart conversions, and significantly improve the post-purchase customer experience! You can learn more about via reading the case study.

#6 Lack of Customer Loyalty

Talking about the challenges of online grocery business, that’s impossible to gloss over customer loyalty phenomenon. In turbulence times, lack of loyalty on the part of shoppers may become one of the most serious problems for your business. The reason is that even during some stressful situations, customers primarily tend to shop from the places they feel emotionally connected with. And if your store is not on this list, you’ve got into some serious troubles, since your store won’t be the first place where customers would prefer to shop.

Solution: Customer loyalty programs implementation

Building a trustworthy relationship with your customers is the only way to overcome this obstacle. And customer loyalty programs implementation is one of the best solutions to establish relationships with the customers and sell groceries online successfully!

However, you should take into account that this is not a matter of one day, and here you should start working on it in advance to get ahead of your competitors. So, it makes sense for you to focus on selecting and addressing the right target audience as well as on defining the strategy of how to attract and retain this audience. All these steps, for sure, will help you to stay a top priority for your customers when it comes to making a purchase. As for recommending certain loyalty programs – you may want to consider popular customer loyalty extensions for Magento such as Reward Points by AheadWorks and Reward Points by Mirasvit. The most popular for Shopify are Loyalty, rewards, and referrals by LoyaltyLion and Smile: Rewards & Loyalty by Smile.io. Some of the most common rewards in modern loyalty programs are points that can be redeemed for products and services from the company or third parties, cashback rewards, discounts, exclusive offers and other rewards for being a member.

#7 Hesitations about Quality of the Products

So far many customers still experience a lack of trust when it comes to shopping in e-commerce grocery stores. Shoppers hesitate about the freshness and high quality of the items they purchase since there’s no way for them to check this. This issue becomes even more crucial if people shop from your online grocery for the first time.

Solution: Return merchandise authorization (RMA) implementation

One of the online grocery store features which is appreciated the most is the clear terms & conditions for refunds in case you receive stale food or products with expired date, and the right return merchandise authorization which is the part of the process of returning a product to receive a refund or replacement fast and hassle-free. In case with an online grocery store, this feature works like a solid guarantee for customers, and rest assured they will appreciate this feature!

#8 Limited Product Assortment

Talking about the features of an online grocery store won’t ever be complete without mentioning the importance of maintaining a diverse range of products. As you probably have already noticed, food is about 75% of the total assortment in an average offline convenience store. As for the remaining 25% – it can be represented as some basic hygienic stuff, kitchenware, seasonings, household cleaners, pharmacy products, pet supplies, and so on. Consequently, people who go to online grocery stores would expect to see approximately the same assortment. However, so far many groceries offer food items only.

Solution: Include not only food items

According to the Washington Post, 30% of profits of an e-commerce website for grocery come from selling non-food items, which is quite a decent rate! Thus, in addition to the food assortment, you can also consider an option to sell organic, vegan, and vegetarian food sets. People who follow diets will appreciate this very much and be sure they’ll get to your store again and again for repeat purchases.

One more popular option to consider for your online grocery shopping platform is selling previously formed food boxes, as it does Morrisons – their customers are welcome to purchase vegetarian and meat-eaters food boxes, various meal boxes, and many more.

#9 Fast-Changing Market Trends

When something wrong is going on, people do not tend to buy their ordinary set of items. Let’s say, numerous explorations during the coronavirus outbreak clearly showed that people prefer to purchase pasta, canned crushed, and tomato sauce, which can be observed from the stats.

Solution: Be ready to react consumer habits change

Sure you can’t prepare your business for any kind of collapse – that’s just impossible to predict everything. However, you can learn stats from previous incidents thoroughly, and find out some products are particularly popular while shopping at e-commerce grocery stores, so you can try to keep them always in stock and show up as featured products on a homepage, promote them on a shopping cart page or create product bundles with less popular products at a more reasonable price.

When it comes to online grocery market trend monitoring – it is much easier when you have some reliable data to analyze. And here you can benefit from analytics tools and key performance indicators. Both of them can provide you with meaningful data and give decisive insights about the current situation with consumer preferences.

#10 Poor performance optimization

Poor page speed load may kill all your efforts on making your online grocery store appealing to your customers. Time is precious, and thus nobody wants to wait when it comes to loading the web page. As you may have guessed, people are even less tend to be patient during some stressful times. According to the studies, a 100-millisecond delay in load time can cause conversion rates to drop by 7%. Sounds impressive, right?

Solution: Store speed optimization

The only way to solve the problem of poor store speed loading is developing a robust strategy for e-commerce store speed optimization. You can find plenty of techniques for speed optimization on your own, but the best solution here is to hire e-commerce professionals with a proven track record and experience with tasks like this.

We worked over store speed optimization for one of our clients. TeachingMe, an Australian-based online tutoring platform, has serious issues regarding the speed. After we made a thorough audit of the store and detected the weaknesses to affect, we concentrated on developing the right strategy to eliminate these weak points.

We started from abandoning the old hosting and instead recommended the owner to switch to Australian-based hosting that’s specifically optimized for Magento. The second step of us was merging and minifying CSS and JavaScript code. One more serious contribution to website speed optimization was image optimization. And eventually, the finishing touch of our engagement here was optimizing the extension’s code and installation of the full-page cache extension. In the future, the owner is considering an option to implement web accessibility practices to the website to ensure it can be used by people with disabilities.

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Final Thoughts

Selling groceries online is not a walk in the park itself and can be dark sometimes, but if you and your business are well prepared – you won’t be stressed too much. Follow our guidelines to make a basic contribution to your online grocery store resilience, contact us to get even more tips exclusively for your online grocery store development or optimization, and rest assured your business will survive!