Shopping for groceries online is becoming more popular than ever. And grocery industry experts only expect that trend to continue. Many options exist for grocery brands to sell, and customers to buy, their products online. Yet, Amazon and the Amazon platform looks well positioned to steal a large part of eCommerce grocery market share. Amazon grocery delivery’s convenience is a large part of the reason.
Amazon’s grocery delivery options are numerous. They are also part of the reason that they seem to have a leg up on everyone else. From the Amazon Prime Pantry program to Amazon Prime Now – there are a variety of ways for customers to get the groceries that they need. We are going to look at the different programs for non-perishable and perishable items. We will also show why their delivery convenience makes Amazon a go-to place for online grocery shopping.
Shoppers looking to buy non-perishable goods and household items have a few choices when it comes to shopping on Amazon. Customers can either purchase products that fall within the Amazon Prime Pantry program, are simply Prime products or are also available under the perishable goods programs.
The variety of options makes shopping for non-perishables on Amazon easy. However, each has different advantages. Amazon is shifting more and more CPG goods into the Amazon Prime Pantry program. These products are typically everyday household items that do not have an expiration date. Delivery for Prime Pantry has its downsides.
Amazon cannot guarantee two-day delivery for Prime Pantry orders. This is mainly due to the size and shape of packages. Amazon tries to package all Prime Pantry product orders together in one shipment. But the problem is that oversized goods can slow down delivery times. For example, ordering a huge bundle of toilet paper with a bottle of olive oil may take longer than 2-days to receive because of the size of the toilet paper bundle.
You can still order CPG items outside of Prime Pantry and still enjoy the guaranteed two-day delivery. Many times, this means that you may be purchasing non-brand name or small brands goods. The Prime Pantry program tends to have larger, well-recognized brands. The proliferation of third-party sellers on the Amazon marketplace make it easy to find supplemental goods that are many times Fulfilled by Amazon with the two-day shipping guarantee.
Non-perishable goods are also available with the goods programs that Amazon offers. The two main programs are AmazonFresh and Amazon Prime Now. Both of these programs are only available in limited areas leaving many eCommerce grocery shoppers out of luck.
AmazonFresh provides same-day or next-day delivery to Amazon Prime members. It is available in most major metropolitan areas. You can also choose whether you want it delivered while you are home or not. Amazon actually had to scale the AmazonFresh program back because of challenges they had with USPS failing to meet their delivery windows.
Another perishable good program that Amazon has rolled out is Amazon Prime Now. Prime now is included in the normal Prime Membership. You can shop for groceries, household items, electronics and other items from local stores and have them delivered to your door. Prime Now offers same day delivery and claims they can get your goods in 1 hour.
These two Amazon programs make it convenient to shop for fresh food items, but the limited availability makes it unrealistic for most parts of the United States. Only about 90 cities or geographic areas have access to Amazon Prime Now. AmazonFresh is also only limited to select zip codes. But there still is another option for Amazon customers to get their fresh and perishable goods.
Amazon shoppers still can purchase perishable goods directly through the Prime program. But, the selection is currently limited. The main reason is the logistical challenges of eCommerce grocery – and that is that is a large reason why Amazon can only provide perishable good delivery in select areas. Grocery brands have conformed to the traditional model of brick and mortar fulfillment. Our team has been helping more companies make the transition to be able to fulfill their perishable goods on eCommerce platforms.
Grocery brands that use cold-storage networks for fulfillment can offer their products as part of the Prime program. This can make a wider range of perishable goods fulfillable from Amazon. Fresh produce is still limited. But, meats, seafood and frozen goods can all easily be fulfilled and Prime eligible.
The key to offering perishable goods as Prime products is establishing your fulfillment network. It is possible to create a network that can reach the full continental U.S. in under 24 hours – and this broadens your audience far more than brick and mortar grocers. Customers searching for perishable goods without paying to join the additional Amazon programs or being limited by geographic availability will continue to search for these types of deals on their Prime accounts.
Many of the Amazon grocery delivery programs have an extra cost that the customer must pay. First, each Amazon customer looking to take advantage of one of these programs must have an Amazon Prime Membership which starts at $119 a year. Then there are additional costs depending which program you choose.
AmazonFresh costs prime members an additional $14.99 every month. Then there are additional delivery fees if certain thresholds are not met. There is a $9.99 charge for orders under $35 not including sales tax. The costs with the program add up quickly and can make it cost prohibitive for many customers.
Prime Pantry also has an additional fee for Amazon Prime members of $4.99 a month. There is also a shipment threshold of $10 – with orders under that threshold having a $5.99 delivery fee. Prime Members without the Prime Pantry add-on can still buy Prime Pantry products for a $5.99 fee on items under $35.
Amazon’s various grocery delivery options have made it a great place for shoppers to get the everyday products they need – and brands to reach customers outside of the traditional grocery model. Fresh produce and perishable goods still face challenges before they can be more available for eCommerce.
Brands should consider getting onto the Amazon platform to take advantage of Amazon grocery delivery now. Listings that get established early can be positioned well for future growth. The fees that customers must pay to get their groceries seem high now. But as Amazon continues to improve its logistics and product fulfillment more and more shoppers will come to take advantage of the convenience.
