The Consumer Direct Services Revolution in Grocery Retailing: an exploratory investigation

Abstract

Purpose - To provide empirical evidence and explanation of the phenomenon that providers of home delivery of groceries are still of minor importance in highly concentrated retail markets. Design/methodology/approach - Based on a critical literature review three propositions were set up. A web based survey was conducted with two prospective consumer groups for home delivery providers: time starved consumers and consumers with Internet affinity. A structural equation modeling analysis was applied in addition to uni- and bivariate analysis. Findings - In contrast to some assumptions in the literature shopping in stores for groceries was not generally perceived to be an annoying activity. Respondents were aware of their own shopping logistics efforts in terms of spatial and temporal distance when shopping in stores but were unable to convert these efforts into costs. Any perceived inconvenience connected with shopping for groceries had no impact on respondents’ willingness to pay for home delivery services or their future intentions to use such services. Research limitations/implications - The study only investigated two specific consumer groups within highly concentrated urban grocery retail markets. However these groups may be considered typical of most western European countries and thus the study’s findings are of importance to retailers. Practical implications - The major findings suggest that in general home delivery service may not be considered a strategic competitive advantage in grocery retail markets. Other marketing issues such as pricing, assortment and store personnel still substantially affect a consumer’s choice of retail formats. This leads to the conclusion that home delivery providers should either appeal to niche markets and/or offer additional differential criteria compared to traditional retail formats. Originality/value - The paper argues for a different viewpoint for researchers investigating the topic of Internet-based distance retailing. Further, the reintegration of logistical tasks from consumers should not be considered detached from other format choice criteria.