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UK consumers hesitate to buy e-groceries
Tuesday, September 25 2001
by Stan Van Haasteren

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Only 19 percent of consumers in the UK will buy food on-line, according to a report by the Institute of Grocery Distribution (IGD) published on Monday.

The findings were published in the IGD's quarterly report called Consumer Watch. Of the more than 1,000 respondents, 20 percent said that they would rather pick the products they like themselves. Seventeen percent of respondents said would not buy groceries on-line because they do not like using a computer, while 15 percent said they were worried about payment security. Thirteen percent said would not shop on-line because they enjoy shopping and the same percentage said they would rather stick to going to the supermarket because they do not always know in advance what they are going to buy.

Despite the results of the survey, the potential for on-line grocery shopping remains good, according to IGD spokeswoman Jane Beard. "The overall attitude towards on-line shopping was positive," she said. "Most respondents just couldn't see the practical use for themselves at the moment. But that might change."

Some respondents believed that on-line shopping services might have a relatively limited product range compared to that found in the store. They were also worried about substitution of products by the retailer if what they requested was unavailable. "But if the retailer addresses these problems, then on-line grocery shopping will possibly go a long way," Beard said. She also stated that increased payment security might persuade consumers to shop on-line.

Anna Dawson from IGD's Consumer Unit said that consumers "appreciate the benefits, for example avoiding checkout queues, saving time, having the goods delivered to their homes and being able to order at any time of the day or night, but many still do feel it is not relevant to their needs." Dawson continued, "Consumers are often reluctant to change their shopping habits and the challenge for the industry is in communicating where home shopping can offer significant additional benefits to entice them to change."

Last week UK grocery giant Tesco reported a 77 percent growth in its on-line sales to STG146 million for the first half of 2001. Lucy Cross, investor relations officer at Tesco, said she was "not too concerned" about the findings. "We are a flexible company and we just follow the customers' needs. A number of our customers want to shop on-line and that is the reason why we provide that service. But if a lot of people say they will never shop on-line, fine, they are still welcome in our stores."

Tesco's increased sales for the first half of 2001 were achieved during a period when the service was still in the process of being introduced, said the company, and Tesco said the ventures' net loss of STG3 million reflected the launch cost of new Web sites such as the company's wine warehouse.

At present, six to seven percent of people buying from some Tesco supermarkets are ordering their goods over the Internet, according to the company. With the current growth of sales, Tesco's on-line business is expected to break even during 2001.

For more info visit http://www.igd.com

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