Amazon Order Variability; Amazon Fresh UK; Online Grocery GrowthBy Cleveland Admin
Despite positive reception to online grocery growth, businesses are frustrated with Amazon’s algorithmic ordering patterns because of demand planning and inventory management. 79% of brands report inaccurate forecasting from Amazon and 95% reported week-to-week ordering variability. Due to this, 71% of manufacturers report that they reference Amazon’s forecasts in the demand planning process, but do not heavily rely on it. According to our study, brands have had success with different tactics in an attempt to manage Amazon’s order variability, including increasing Amazon-specific safety stock, automation of order acknowledgement and order cancellation, and increasing domestic product.
Amazon Fresh UK:
Amazon Fresh has opened up its first UK location in Ealing, London on March 4th. Like Amazon Go stores, this location has cashierless checkout, making it different from the ten Amazon Fresh retail locations that have opened stateside. The integration of Fresh and Go stores demonstrated in the Ealing location is interesting to note as Amazon Go has been coupled under Fresh internally at Amazon. This could be due to continued online grocery growth.
Incremental Online Grocery Shoppers:
One of the interesting datapoints from our latest 1,000+ consumer study within online grocery is the momentum these platforms are generating in terms of new users. Our study looked at shoppers within the last 30 days, and on average, 7.5% of these shoppers are new as of 2021. While this is well below the major uptick seen during the pandemic in 2020, the ability for these platforms to attract incremental shoppers is a very positive sign of the online grocery growth over the coming years.
Source: CRC Online Grocery Growth Consumer Study, March 3, 2021, N=1,086 respondents in total, ~350/platform