Amazon Fresh has made its way to Australia, and Australians are wasting no time at all ignoring the hell out of it. Even though the Fresh program brings grocery deliveries right to a client’s doorstep, Roy Morgan’s State of the Nation Retail Spotlight reporting details that “Australian grocery buyers made more than 2.5 trips per week to supermarkets.” Morgan himself stated, “While almost 30 per cent say they’d consider it in the next 12 months, only around 3 per cent actually do so in any given four-week period.”
For all of its convenience, online grocery shopping is still a pretty basic thing. Brick and mortar grocery stores have moved into the realm of “retailtainment,” bringing entertainment into the shopping experience. Top grocery store chains are holding cooking classes, free tastings and other events to keep foot traffic moving – playing dirty!
The big dogs in Australia, Coles and Woolworths, are already putting a task force in position to handle the threat. Woolworths has created a fully independent business division. As Morgan noted, “It will also be interesting to track the success of Woolworths’ recently announced partnership with Australia Post to install more than 500 parcel lockers for their ‘Click-and-collect’ services, providing an extra 24/7 delivery option for their online customers.” Coles may have a tougher climb. Morgan’s studies show that around one third of the shoppers there are considering online shopping seriously. However, Amazon Fresh definitely has some advantages that it can leverage to get that market share.
Without the need for extra marketing gimmicks, online grocery distributors do not have to incorporate added expenses into their normal costs of doing business. The result is lower overall prices for the same kinds of foods. Combined with the added convenience of shopping online, Fresh may appeal to a contingent of price conscious consumers who may not have the mobility or the time of the average shopper. If Amazon targets older consumers and veterans, say many industry experts, the Fresh program will definitely have a foot in the door to the Australian mainstream.
In short, Australia may not be ready for online shopping now. However, there is room for growth. Additionally, do not discount the ability of the big guys in the brick and mortar grocery market to pull a 180 on Amazon Fresh and get into the online grocery shopping market.