Coronavirus will change the grocery industry forever

The outbreak of coronavirus is pushing Americans to buy their groceries online, a development that could have a lasting effect on the supermarket industry....

Posted: Mar 19, 2020 3:15 PM
Updated: Mar 19, 2020 5:37 PM

The outbreak of coronavirus is pushing Americans to buy their groceries online, a development that could have a lasting effect on the supermarket industry.

While shopping for books and electronics online and ordering dinner through delivery apps have become staples of American life, most customers still prefer to purchase their meat and vegetables at the store. Last year, just 4% of grocery sales in the United States came online, according to Nielsen.

However, with shoppers stuck in their homes in the wake of the virus, online grocery shopping is exploding. Downloads of Instacart, Walmart's grocery app and Shipt increased 218%, 160%, and 124% respectively last Sunday compared with a year prior.

"We are seeing a larger percentage of customers over the age of 60 that are coming online," said JJ Fleeman, chief e-commerce officer for Ahold Delhaize in the United States, which owns brands like Stop & Shop, Food Lion and the online delivery service Peapod. "We're seeing a lot of new customers coming into the channel."

A third of consumers said Sunday that they had purchased groceries for online pickup or delivery in the past seven days, according to a survey by analysts at Gordon Haskett Research Advisors. Around 41% said they were buying groceries online for the first time.

"Consumer behaviors always shift in times of disaster," said Doug Baker, vice president of industry relations at FMI, a trade group for food retailers. "People are learning new skills and how to shop online as a result of what we're experiencing today."

Maria Alvarado in Phoenix usually shops in person for groceries at Walmart or Safeway, but she tried ordering online last week for the first time through Walmart's in-store pickup option. She plans to keep using the service.

"Once things go back to normal, I will probably use online again," she said. "It was really easy."

Big grocers like Walmart, Albertsons, Stop & Shop, Meijer, Hy-Vee and others have been experimenting with new ways to fulfill online orders in recent years. They have increasingly looked to technology to reduce costs and keep aisles from jamming up with shoppers and workers picking customers' orders.

Grocers have been building automated mini-warehouses inside their stores and opening up "dark stores" — locations that look like supermarkets but are closed to customers — to make deliveries and prepare pickup orders.

Yet the crush of demand in the wake of coronavirus has overwhelmed grocers' delivery and pickup networks, causing long waits, cancellations and outages in some parts of the country.

"The surge in online grocery orders is causing operational difficulties," said Bill Bishop, CEO of grocery consulting firm Brick Meets Click.

Grocers are scrambling to adjust and hiring workers to keep up.

Fleeman from Ahold Delhaize said the company was adding "web servers to help us process the increased demand" and offering more windows for customers to pickup their orders or get delivery.

This shift online during the crisis may reshape the supermarket industry by helping large grocers consolidate their grip, experts predict.

"We see this unfortunate period accelerating structural changes in consumer shopping," possibly by five years, said Seth Sigman, analyst at Credit Suisse, wrote in a report. "This is driving significant growth in new customers" to Walmart.

Consumers adopting online grocery shopping may add to the pressure small and mid-sized grocers already face, analysts say. These smaller chains don't have as much capital to invest in building out their delivery infrastructure. And delivery is less profitable for grocers than traditional purchases in stores.

Coronavirus "may hasten the adoption" of online delivery and pickup, touching off long-term challenges for smaller chains earlier than expected, Kelly Bania, analyst for BMO Capital Markets, said in a research report this week.

Indiana Coronavirus Cases

Data is updated nightly.

Cases: 613228

Reported Deaths: 9728
CountyCasesDeaths
Marion846851338
Lake45676687
Allen32980552
Hamilton29649315
St. Joseph27531382
Elkhart24478345
Vanderburgh19610250
Tippecanoe18108141
Johnson15191295
Porter14944169
Hendricks14485250
Madison11044222
Clark10811144
Vigo10795181
Monroe9458113
Delaware9170134
LaPorte9145164
Howard8292144
Kosciusko810183
Warrick680299
Hancock6782104
Bartholomew6640100
Floyd6507110
Wayne6177162
Grant6027116
Dubois558680
Boone556468
Morgan548695
Henry511464
Marshall506984
Cass486964
Dearborn486545
Noble475659
Jackson427747
Shelby420781
Lawrence393780
Clinton375044
Gibson374459
Harrison353045
DeKalb349864
Montgomery347654
Knox336239
Miami324544
Steuben315046
Whitley311126
Wabash305851
Adams302836
Ripley300546
Putnam298950
Huntington294860
Jasper291734
White275143
Daviess271774
Jefferson266238
Decatur249583
Fayette248648
Greene242262
Posey241028
Wells236951
LaGrange230062
Scott226839
Clay224332
Randolph215248
Jennings200636
Sullivan193533
Spencer193022
Washington188023
Fountain184927
Starke176444
Jay168623
Owen167637
Fulton164830
Orange160935
Carroll159715
Rush156318
Perry155929
Vermillion149734
Franklin149333
Tipton133133
Parke13088
Pike118526
Blackford111822
Pulaski97837
Newton92021
Brown88335
Benton87110
Crawford8099
Martin74913
Warren6857
Switzerland6695
Union6297
Ohio4977
Unassigned0376

Ohio Coronavirus Cases

Data is updated nightly.

Cases: 868656

Reported Deaths: 10768
CountyCasesDeaths
Franklin102154707
Cuyahoga865201153
Hamilton64744448
Montgomery43516419
Summit35250762
Lucas31663631
Butler31268232
Stark26096443
Warren19830142
Lorain19296229
Mahoning17471339
Lake16250154
Clermont16128112
Delaware1453680
Licking13326137
Fairfield1294981
Trumbull12920317
Greene12174141
Medina11732168
Clark11058265
Wood10457158
Allen9988127
Portage9454111
Miami924473
Richland9236118
Marion7486113
Tuscarawas7440183
Columbiana7409124
Pickaway732150
Wayne7111172
Muskingum710342
Erie6221130
Ross5558100
Hancock555292
Scioto542764
Geauga515955
Darke473492
Lawrence460658
Union456928
Ashtabula456473
Sandusky439562
Mercer435089
Seneca433866
Huron432841
Auglaize424164
Shelby422522
Jefferson422469
Belmont421145
Washington394240
Athens38389
Putnam378075
Madison358129
Knox356122
Ashland349038
Fulton340443
Defiance334486
Crawford325774
Preble322737
Brown315821
Logan312132
Ottawa296543
Clinton291543
Williams280367
Highland279018
Jackson265845
Guernsey257126
Champaign253428
Fayette239530
Morrow23464
Perry233718
Holmes226774
Henry221953
Hardin215533
Coshocton206922
Van Wert203445
Gallia199826
Wyandot196751
Pike178017
Adams177715
Hocking173224
Carroll157616
Paulding145321
Noble121040
Meigs109724
Monroe102232
Harrison89921
Morgan83931
Vinton71314
Unassigned00
Fort Wayne
Cloudy
32° wxIcon
Hi: 33° Lo: 30°
Feels Like: 25°
Angola
Cloudy
28° wxIcon
Hi: 31° Lo: 27°
Feels Like: 20°
Huntington
Cloudy
30° wxIcon
Hi: 32° Lo: 30°
Feels Like: 30°
Fort Wayne
Cloudy
32° wxIcon
Hi: 33° Lo: 30°
Feels Like: 25°
Lima
Cloudy
32° wxIcon
Hi: 33° Lo: 31°
Feels Like: 24°
More Clouds than Sun Wednesday
WFFT Radar
WFFT Temperatures
WFFT National

Community Events