This might be the explanation you’ve been waiting for if you’ve been wondering why Amazon and others are willing to invest millions in selling groceries online.
In a special report on Business Insider, a lengthy slideshow recounts how consumer behavior is shifting from offline to online, and how that’s affecting the retail industry. The high-level summary is that while physical retailers are shuttering stores, online sales are growing.
But what’s the deal with groceries?
Two slides, in particular, explain why there’s a sudden surge of interest. Recent entrants into the space include grocery delivery services, like Amazon Fresh and Instacart, but also a host of online food delivery services exist, like Munchery, Caviar, Eat24, Bitesquad, Postmates.
In short, food sales are an area worth investing in because so little of it takes place online today. If any of these companies are successful at shifting consumer habits just a little bit, and can get the economics to work, it could represent a huge opportunity.
In the first slide, we see how much money is currently being spent offline vs. online in the U.S., and online amounts to just peanuts:
In the second slide, we see how groceries stack up against other categories, like furniture, clothing or health. Those segments have already started shifting online. The food and beverage category is the last segment that remains nearly untouched.