The evolution of e-commerce and how food businesses can benefit from it

The evolution of e-commerce and how food businesses can benefit from it

By
Laura Robinson
April 21, 2020

The message from sector experts is clear: if you’re not selling online yet, you should be.

But in an increasingly noisy digital marketplace, what does that mean for food businesses in 2020?

A few years back, many brands had experimented with web stores. Then technological developments and growing customer expectations upped the ante. In 2018 and 2019 we saw a shift towards digital-first or omnichannel models. Today, the most forward-thinking businesses see e-commerce as part of a wider digitalisation strategy that provides seamless, cross-channel experiences.

After taking a while to find its feet, e-commerce in the food sector is now picking up the pace. Studies suggest that global food e-commerce sales will triple by 2023. 70% of consumers will buy food online by 2024 and these purchases will make up 15-20% of the food and beverage industry’s overall sales by 2025.  

Faced with a myriad of models and approaches, it can be difficult to know where to start. So, let’s dive into the latest digital trends and see what e-commerce can offer.

Trend drivers: Access and confidence, shifting habits and customer loyalty

For consumers, buying online is easier and more convenient than ever. 97% of EU households now have access to fixed broadband services, while improvements to data security have strengthened consumer confidence. Millennials – the biggest online food ordering converts - are now entering their prime spending years. And the closure of physical stores due to the COVID-19 pandemic is finally convincing late adopters to embrace the digital world.

E-commerce is also a boon for businesses. Online stores can promote greater brand loyalty by keeping track of customers’ purchase histories to personalise their offer. Products can also be more easily transformed into subscriptions or memberships that drive repeat purchases and activate longer-term revenue streams. Ultimately, loyal customers are worth up to 10 times as much as their first purchase. So it pays to create a digital experience that keeps them coming back.

Models: B2C, B2B, B2B2C - and the growth of D2C

B2C – the model most commonly associated with e-commerce - allows businesses to sell to consumers via their own web shop or an existing third-party platform. When creating their own store, companies typically invest in developing their digital presence in parallel - through content marketing, social media or paid adverts - to build brand awareness and drive online traffic.  

But the e-commerce landscape is now becoming increasingly diverse. The development of B2B e-commerce, for example, has been largely driven by millennial buyers, looking to improve efficiency and reduce manual errors by partly automating the ordering process through inventory tracking. Then there’s the B2B2C model, where businesses collaborate with partners that have an existing relationship with their target customers. The original business builds credibility and acquires customers in bulk, while the partner business earns a commission on sales or offers added value to their existing customer base.  

D2C – direct to consumer sales – is becoming one of the most significant growth trends amongst producers, manufacturers and wholesalers. This approach not only maximises efficiency and boosts their profit margins but also gives them ownership of the customer relationship, allowing them to better understand and respond to their needs.

Thinking it through: Tools and fulfillment

Companies looking to develop online sales channels now have a plethora of tools at their fingertips. Businesses may start with free online store builders and shopping cart solutions or opt for a subscription to a fully hosted platform, like Big Commerce or Shopify. Then, as their online activities grow, there are countless options for add-ons – from tracking and reporting software through to AI-powered systems that enable voice commerce, advanced personalisation and predictive and anticipatory sales strategies.

When it comes to fulfillment, food businesses often face specific challenges around packaging and the delivery of highly perishable or delicate food items. Companies will need to weigh up the pros and cons between developing solutions in-house or working with a specialist logistics company. Either way, experts recommend that businesses experiment with a small delivery radius first and expand as sales grow.  

Finding the e-commerce sweet spot: Jeni’s and Ben & Jerry’s

Jeni Britton Bauer - founder of Jeni’s Splendid Ice Cream - believes in traditional good food with a heavy sprinkle of 21st century innovation. This is just as apparent in her creative range of flavours as it is in her brand’s customer-centric, omnichannel sales strategy. As well as serving up iced treats in their “scoop shops”, the brand offers a seamless, experience-oriented delivery service. Their social media stream is full of videos of excited customers receiving their products. Ordering is quick, simple and human and deliveries are made in a bright orange gift box, complete with a card and personalised message. And the strategy seems to be working: Jeni’s overall sales – split between retail, wholesale and e-commerce - exceeded $42 million last year.

Recognising the opportunity to connect with their fans, Unilever giant Ben & Jerry’s ventured into direct online sales in 2017. The brand partnered with e-tailor, a specialist in frozen fulfillment, to ship products in dry ice overnight to ensure perfect creamy texture on arrival. In November last year, the company joined forces with Barista’s Coffee Co. to launch Munchie Magic - a virtual restaurant that delivers a range of snack products direct to customer doorsteps through collaborations with UberEats, DoorDash and GrubHub. The brand has seen a huge surge in orders since the COVID-19 pandemic took hold, enabling them to open five new locations in just twenty-two days.

Keep it human - and never stop testing

Ultimately, digital tools are a means to an end. The goal is to make the purchasing process as simple, positive and enjoyable as possible - and companies don’t need to have a team of in-house user experience experts to achieve this. Thinking through the ordering process as if it were a real human interaction and testing it out personally can flag improvements that have a real impact on sales volumes and repeat custom.

Of course, there’s no need to jump in with both feet. But by making e-commerce a spoke in your overall strategy, you can diversify your revenue streams, build resilience and ensure your business benefits as online sales grow.

Business opportunities

Manufacturers

  • Launching a new product? Try offering exclusive D2C sales to a community of fans. This will give you direct feedback to inform product development and help you refine your marketing messages.
  • Consider introducing or optimising your B2B e-commerce platform to attract millennials buyers looking for more efficient ordering solutions.

Food Service

  • If e-commerce is a short-term strategy during the COVID-19 lockdown, explore collaborations with third-party delivery apps to get started quickly. If you’re concerned about upfront fees or weighty commissions, the Too Good to Go app, is a quick, easy and free alternative.
  • If you’re reconsidering your longer-term strategy, consider using the increase in online demand to test out customer interest in e-commerce by trialling local deliveries.

Retail

  • While grocery delivery slots are like gold dust, explore how you can develop online channels to convert physical customers into e-customers - and test out loyalty mechanisms to keep them coming back.  
  • Does another business have access to a community of consumers who might be interested in your products? Consider the benefits of a B2B2C e-commerce collaboration.

Written by
Laura Robinson

From policy geek to digital consultant, Laura has always enjoyed bringing people together through words or tools to drive positive change. She is most proud of finally taking the leap into entrepreneurship by founding Pink Pear Agency - a network of passionate specialists who help food businesses grow innovative projects and share their stories with the world. Laura is currently interested in project development and management, digital tools, content strategy and copywriting.

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  • Access Member Directory
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The message from sector experts is clear: if you’re not selling online yet, you should be.

But in an increasingly noisy digital marketplace, what does that mean for food businesses in 2020?

A few years back, many brands had experimented with web stores. Then technological developments and growing customer expectations upped the ante. In 2018 and 2019 we saw a shift towards digital-first or omnichannel models. Today, the most forward-thinking businesses see e-commerce as part of a wider digitalisation strategy that provides seamless, cross-channel experiences.

After taking a while to find its feet, e-commerce in the food sector is now picking up the pace. Studies suggest that global food e-commerce sales will triple by 2023. 70% of consumers will buy food online by 2024 and these purchases will make up 15-20% of the food and beverage industry’s overall sales by 2025.  

Faced with a myriad of models and approaches, it can be difficult to know where to start. So, let’s dive into the latest digital trends and see what e-commerce can offer.

Trend drivers: Access and confidence, shifting habits and customer loyalty

For consumers, buying online is easier and more convenient than ever. 97% of EU households now have access to fixed broadband services, while improvements to data security have strengthened consumer confidence. Millennials – the biggest online food ordering converts - are now entering their prime spending years. And the closure of physical stores due to the COVID-19 pandemic is finally convincing late adopters to embrace the digital world.

E-commerce is also a boon for businesses. Online stores can promote greater brand loyalty by keeping track of customers’ purchase histories to personalise their offer. Products can also be more easily transformed into subscriptions or memberships that drive repeat purchases and activate longer-term revenue streams. Ultimately, loyal customers are worth up to 10 times as much as their first purchase. So it pays to create a digital experience that keeps them coming back.

Models: B2C, B2B, B2B2C - and the growth of D2C

B2C – the model most commonly associated with e-commerce - allows businesses to sell to consumers via their own web shop or an existing third-party platform. When creating their own store, companies typically invest in developing their digital presence in parallel - through content marketing, social media or paid adverts - to build brand awareness and drive online traffic.  

But the e-commerce landscape is now becoming increasingly diverse. The development of B2B e-commerce, for example, has been largely driven by millennial buyers, looking to improve efficiency and reduce manual errors by partly automating the ordering process through inventory tracking. Then there’s the B2B2C model, where businesses collaborate with partners that have an existing relationship with their target customers. The original business builds credibility and acquires customers in bulk, while the partner business earns a commission on sales or offers added value to their existing customer base.  

D2C – direct to consumer sales – is becoming one of the most significant growth trends amongst producers, manufacturers and wholesalers. This approach not only maximises efficiency and boosts their profit margins but also gives them ownership of the customer relationship, allowing them to better understand and respond to their needs.

Thinking it through: Tools and fulfillment

Companies looking to develop online sales channels now have a plethora of tools at their fingertips. Businesses may start with free online store builders and shopping cart solutions or opt for a subscription to a fully hosted platform, like Big Commerce or Shopify. Then, as their online activities grow, there are countless options for add-ons – from tracking and reporting software through to AI-powered systems that enable voice commerce, advanced personalisation and predictive and anticipatory sales strategies.

When it comes to fulfillment, food businesses often face specific challenges around packaging and the delivery of highly perishable or delicate food items. Companies will need to weigh up the pros and cons between developing solutions in-house or working with a specialist logistics company. Either way, experts recommend that businesses experiment with a small delivery radius first and expand as sales grow.  

Finding the e-commerce sweet spot: Jeni’s and Ben & Jerry’s

Jeni Britton Bauer - founder of Jeni’s Splendid Ice Cream - believes in traditional good food with a heavy sprinkle of 21st century innovation. This is just as apparent in her creative range of flavours as it is in her brand’s customer-centric, omnichannel sales strategy. As well as serving up iced treats in their “scoop shops”, the brand offers a seamless, experience-oriented delivery service. Their social media stream is full of videos of excited customers receiving their products. Ordering is quick, simple and human and deliveries are made in a bright orange gift box, complete with a card and personalised message. And the strategy seems to be working: Jeni’s overall sales – split between retail, wholesale and e-commerce - exceeded $42 million last year.

Recognising the opportunity to connect with their fans, Unilever giant Ben & Jerry’s ventured into direct online sales in 2017. The brand partnered with e-tailor, a specialist in frozen fulfillment, to ship products in dry ice overnight to ensure perfect creamy texture on arrival. In November last year, the company joined forces with Barista’s Coffee Co. to launch Munchie Magic - a virtual restaurant that delivers a range of snack products direct to customer doorsteps through collaborations with UberEats, DoorDash and GrubHub. The brand has seen a huge surge in orders since the COVID-19 pandemic took hold, enabling them to open five new locations in just twenty-two days.

Keep it human - and never stop testing

Ultimately, digital tools are a means to an end. The goal is to make the purchasing process as simple, positive and enjoyable as possible - and companies don’t need to have a team of in-house user experience experts to achieve this. Thinking through the ordering process as if it were a real human interaction and testing it out personally can flag improvements that have a real impact on sales volumes and repeat custom.

Of course, there’s no need to jump in with both feet. But by making e-commerce a spoke in your overall strategy, you can diversify your revenue streams, build resilience and ensure your business benefits as online sales grow.

Business opportunities

Manufacturers

  • Launching a new product? Try offering exclusive D2C sales to a community of fans. This will give you direct feedback to inform product development and help you refine your marketing messages.
  • Consider introducing or optimising your B2B e-commerce platform to attract millennials buyers looking for more efficient ordering solutions.

Food Service

  • If e-commerce is a short-term strategy during the COVID-19 lockdown, explore collaborations with third-party delivery apps to get started quickly. If you’re concerned about upfront fees or weighty commissions, the Too Good to Go app, is a quick, easy and free alternative.
  • If you’re reconsidering your longer-term strategy, consider using the increase in online demand to test out customer interest in e-commerce by trialling local deliveries.

Retail

  • While grocery delivery slots are like gold dust, explore how you can develop online channels to convert physical customers into e-customers - and test out loyalty mechanisms to keep them coming back.  
  • Does another business have access to a community of consumers who might be interested in your products? Consider the benefits of a B2B2C e-commerce collaboration.

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  • Read Unlimited Articles
  • Access Member Directory
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The message from sector experts is clear: if you’re not selling online yet, you should be.

But in an increasingly noisy digital marketplace, what does that mean for food businesses in 2020?

A few years back, many brands had experimented with web stores. Then technological developments and growing customer expectations upped the ante. In 2018 and 2019 we saw a shift towards digital-first or omnichannel models. Today, the most forward-thinking businesses see e-commerce as part of a wider digitalisation strategy that provides seamless, cross-channel experiences.

After taking a while to find its feet, e-commerce in the food sector is now picking up the pace. Studies suggest that global food e-commerce sales will triple by 2023. 70% of consumers will buy food online by 2024 and these purchases will make up 15-20% of the food and beverage industry’s overall sales by 2025.  

Faced with a myriad of models and approaches, it can be difficult to know where to start. So, let’s dive into the latest digital trends and see what e-commerce can offer.

Trend drivers: Access and confidence, shifting habits and customer loyalty

For consumers, buying online is easier and more convenient than ever. 97% of EU households now have access to fixed broadband services, while improvements to data security have strengthened consumer confidence. Millennials – the biggest online food ordering converts - are now entering their prime spending years. And the closure of physical stores due to the COVID-19 pandemic is finally convincing late adopters to embrace the digital world.

E-commerce is also a boon for businesses. Online stores can promote greater brand loyalty by keeping track of customers’ purchase histories to personalise their offer. Products can also be more easily transformed into subscriptions or memberships that drive repeat purchases and activate longer-term revenue streams. Ultimately, loyal customers are worth up to 10 times as much as their first purchase. So it pays to create a digital experience that keeps them coming back.

Models: B2C, B2B, B2B2C - and the growth of D2C

B2C – the model most commonly associated with e-commerce - allows businesses to sell to consumers via their own web shop or an existing third-party platform. When creating their own store, companies typically invest in developing their digital presence in parallel - through content marketing, social media or paid adverts - to build brand awareness and drive online traffic.  

But the e-commerce landscape is now becoming increasingly diverse. The development of B2B e-commerce, for example, has been largely driven by millennial buyers, looking to improve efficiency and reduce manual errors by partly automating the ordering process through inventory tracking. Then there’s the B2B2C model, where businesses collaborate with partners that have an existing relationship with their target customers. The original business builds credibility and acquires customers in bulk, while the partner business earns a commission on sales or offers added value to their existing customer base.  

D2C – direct to consumer sales – is becoming one of the most significant growth trends amongst producers, manufacturers and wholesalers. This approach not only maximises efficiency and boosts their profit margins but also gives them ownership of the customer relationship, allowing them to better understand and respond to their needs.

Thinking it through: Tools and fulfillment

Companies looking to develop online sales channels now have a plethora of tools at their fingertips. Businesses may start with free online store builders and shopping cart solutions or opt for a subscription to a fully hosted platform, like Big Commerce or Shopify. Then, as their online activities grow, there are countless options for add-ons – from tracking and reporting software through to AI-powered systems that enable voice commerce, advanced personalisation and predictive and anticipatory sales strategies.

When it comes to fulfillment, food businesses often face specific challenges around packaging and the delivery of highly perishable or delicate food items. Companies will need to weigh up the pros and cons between developing solutions in-house or working with a specialist logistics company. Either way, experts recommend that businesses experiment with a small delivery radius first and expand as sales grow.  

Finding the e-commerce sweet spot: Jeni’s and Ben & Jerry’s

Jeni Britton Bauer - founder of Jeni’s Splendid Ice Cream - believes in traditional good food with a heavy sprinkle of 21st century innovation. This is just as apparent in her creative range of flavours as it is in her brand’s customer-centric, omnichannel sales strategy. As well as serving up iced treats in their “scoop shops”, the brand offers a seamless, experience-oriented delivery service. Their social media stream is full of videos of excited customers receiving their products. Ordering is quick, simple and human and deliveries are made in a bright orange gift box, complete with a card and personalised message. And the strategy seems to be working: Jeni’s overall sales – split between retail, wholesale and e-commerce - exceeded $42 million last year.

Recognising the opportunity to connect with their fans, Unilever giant Ben & Jerry’s ventured into direct online sales in 2017. The brand partnered with e-tailor, a specialist in frozen fulfillment, to ship products in dry ice overnight to ensure perfect creamy texture on arrival. In November last year, the company joined forces with Barista’s Coffee Co. to launch Munchie Magic - a virtual restaurant that delivers a range of snack products direct to customer doorsteps through collaborations with UberEats, DoorDash and GrubHub. The brand has seen a huge surge in orders since the COVID-19 pandemic took hold, enabling them to open five new locations in just twenty-two days.

Keep it human - and never stop testing

Ultimately, digital tools are a means to an end. The goal is to make the purchasing process as simple, positive and enjoyable as possible - and companies don’t need to have a team of in-house user experience experts to achieve this. Thinking through the ordering process as if it were a real human interaction and testing it out personally can flag improvements that have a real impact on sales volumes and repeat custom.

Of course, there’s no need to jump in with both feet. But by making e-commerce a spoke in your overall strategy, you can diversify your revenue streams, build resilience and ensure your business benefits as online sales grow.

Business opportunities

Manufacturers

  • Launching a new product? Try offering exclusive D2C sales to a community of fans. This will give you direct feedback to inform product development and help you refine your marketing messages.
  • Consider introducing or optimising your B2B e-commerce platform to attract millennials buyers looking for more efficient ordering solutions.

Food Service

  • If e-commerce is a short-term strategy during the COVID-19 lockdown, explore collaborations with third-party delivery apps to get started quickly. If you’re concerned about upfront fees or weighty commissions, the Too Good to Go app, is a quick, easy and free alternative.
  • If you’re reconsidering your longer-term strategy, consider using the increase in online demand to test out customer interest in e-commerce by trialling local deliveries.

Retail

  • While grocery delivery slots are like gold dust, explore how you can develop online channels to convert physical customers into e-customers - and test out loyalty mechanisms to keep them coming back.  
  • Does another business have access to a community of consumers who might be interested in your products? Consider the benefits of a B2B2C e-commerce collaboration.

The message from sector experts is clear: if you’re not selling online yet, you should be.

But in an increasingly noisy digital marketplace, what does that mean for food businesses in 2020?

A few years back, many brands had experimented with web stores. Then technological developments and growing customer expectations upped the ante. In 2018 and 2019 we saw a shift towards digital-first or omnichannel models. Today, the most forward-thinking businesses see e-commerce as part of a wider digitalisation strategy that provides seamless, cross-channel experiences.

After taking a while to find its feet, e-commerce in the food sector is now picking up the pace. Studies suggest that global food e-commerce sales will triple by 2023. 70% of consumers will buy food online by 2024 and these purchases will make up 15-20% of the food and beverage industry’s overall sales by 2025.  

Faced with a myriad of models and approaches, it can be difficult to know where to start. So, let’s dive into the latest digital trends and see what e-commerce can offer.

Trend drivers: Access and confidence, shifting habits and customer loyalty

For consumers, buying online is easier and more convenient than ever. 97% of EU households now have access to fixed broadband services, while improvements to data security have strengthened consumer confidence. Millennials – the biggest online food ordering converts - are now entering their prime spending years. And the closure of physical stores due to the COVID-19 pandemic is finally convincing late adopters to embrace the digital world.

E-commerce is also a boon for businesses. Online stores can promote greater brand loyalty by keeping track of customers’ purchase histories to personalise their offer. Products can also be more easily transformed into subscriptions or memberships that drive repeat purchases and activate longer-term revenue streams. Ultimately, loyal customers are worth up to 10 times as much as their first purchase. So it pays to create a digital experience that keeps them coming back.

Models: B2C, B2B, B2B2C - and the growth of D2C

B2C – the model most commonly associated with e-commerce - allows businesses to sell to consumers via their own web shop or an existing third-party platform. When creating their own store, companies typically invest in developing their digital presence in parallel - through content marketing, social media or paid adverts - to build brand awareness and drive online traffic.  

But the e-commerce landscape is now becoming increasingly diverse. The development of B2B e-commerce, for example, has been largely driven by millennial buyers, looking to improve efficiency and reduce manual errors by partly automating the ordering process through inventory tracking. Then there’s the B2B2C model, where businesses collaborate with partners that have an existing relationship with their target customers. The original business builds credibility and acquires customers in bulk, while the partner business earns a commission on sales or offers added value to their existing customer base.  

D2C – direct to consumer sales – is becoming one of the most significant growth trends amongst producers, manufacturers and wholesalers. This approach not only maximises efficiency and boosts their profit margins but also gives them ownership of the customer relationship, allowing them to better understand and respond to their needs.

Thinking it through: Tools and fulfillment

Companies looking to develop online sales channels now have a plethora of tools at their fingertips. Businesses may start with free online store builders and shopping cart solutions or opt for a subscription to a fully hosted platform, like Big Commerce or Shopify. Then, as their online activities grow, there are countless options for add-ons – from tracking and reporting software through to AI-powered systems that enable voice commerce, advanced personalisation and predictive and anticipatory sales strategies.

When it comes to fulfillment, food businesses often face specific challenges around packaging and the delivery of highly perishable or delicate food items. Companies will need to weigh up the pros and cons between developing solutions in-house or working with a specialist logistics company. Either way, experts recommend that businesses experiment with a small delivery radius first and expand as sales grow.  

Finding the e-commerce sweet spot: Jeni’s and Ben & Jerry’s

Jeni Britton Bauer - founder of Jeni’s Splendid Ice Cream - believes in traditional good food with a heavy sprinkle of 21st century innovation. This is just as apparent in her creative range of flavours as it is in her brand’s customer-centric, omnichannel sales strategy. As well as serving up iced treats in their “scoop shops”, the brand offers a seamless, experience-oriented delivery service. Their social media stream is full of videos of excited customers receiving their products. Ordering is quick, simple and human and deliveries are made in a bright orange gift box, complete with a card and personalised message. And the strategy seems to be working: Jeni’s overall sales – split between retail, wholesale and e-commerce - exceeded $42 million last year.

Recognising the opportunity to connect with their fans, Unilever giant Ben & Jerry’s ventured into direct online sales in 2017. The brand partnered with e-tailor, a specialist in frozen fulfillment, to ship products in dry ice overnight to ensure perfect creamy texture on arrival. In November last year, the company joined forces with Barista’s Coffee Co. to launch Munchie Magic - a virtual restaurant that delivers a range of snack products direct to customer doorsteps through collaborations with UberEats, DoorDash and GrubHub. The brand has seen a huge surge in orders since the COVID-19 pandemic took hold, enabling them to open five new locations in just twenty-two days.

Keep it human - and never stop testing

Ultimately, digital tools are a means to an end. The goal is to make the purchasing process as simple, positive and enjoyable as possible - and companies don’t need to have a team of in-house user experience experts to achieve this. Thinking through the ordering process as if it were a real human interaction and testing it out personally can flag improvements that have a real impact on sales volumes and repeat custom.

Of course, there’s no need to jump in with both feet. But by making e-commerce a spoke in your overall strategy, you can diversify your revenue streams, build resilience and ensure your business benefits as online sales grow.

Business opportunities

Manufacturers

  • Launching a new product? Try offering exclusive D2C sales to a community of fans. This will give you direct feedback to inform product development and help you refine your marketing messages.
  • Consider introducing or optimising your B2B e-commerce platform to attract millennials buyers looking for more efficient ordering solutions.

Food Service

  • If e-commerce is a short-term strategy during the COVID-19 lockdown, explore collaborations with third-party delivery apps to get started quickly. If you’re concerned about upfront fees or weighty commissions, the Too Good to Go app, is a quick, easy and free alternative.
  • If you’re reconsidering your longer-term strategy, consider using the increase in online demand to test out customer interest in e-commerce by trialling local deliveries.

Retail

  • While grocery delivery slots are like gold dust, explore how you can develop online channels to convert physical customers into e-customers - and test out loyalty mechanisms to keep them coming back.  
  • Does another business have access to a community of consumers who might be interested in your products? Consider the benefits of a B2B2C e-commerce collaboration.