Traditional grocery stores find themselves reeling as a rising number of consumers pivot towards digital platforms for their health and beauty needs, according to recent research.

Statistical findings from a PYMNTS study, "Tracking the Digital Payments Takeover: Catching the Coming eCommerce Wave," conducted in collaboration with Amazon Web Services, illustrate this emerging trend. According to an April survey of nearly 2,700 U.S. consumers, 39% are highly likely to ramp up their online purchases of health and beauty products in the future.

Furthermore, a study titled "Changes in Grocery Shopping Habits and Perception," which examined the shopping behaviors of over 2,400 U.S. consumers, has unveiled a sharp decline in in-store purchases of personal and healthcare products. Roughly half of all grocery shoppers have curtailed their visits to brick-and-mortar outlets for these goods in recent years. The study also found that only one-third of respondents are buying these products in stores more often than online.

This trend paints a picture where online retailers like Amazon are gaining ground, particularly in the realm of shelf-stable goods. Amazon CEO, Andy Jassy, noted this shift during the company's latest earnings call. He compared Amazon's burgeoning grocery business to the entry of mass merchandisers into the grocery sector several decades ago. In the face of economic uncertainty, consumers are opting for non-perishable, economical choices, making consumables an area of continued strength, Jassy noted.

Karen Webster of PYMNTS, however, highlights the sobering reality for grocery executives, who may have been lulled into a sense of security by the ongoing dominance of physical stores. She warns that their reign is gradually eroding, one aisle at a time.

"Grocery store executives might soon experience the same agonizing downfall that haunted department store CEOs," Webster said. "Death by a thousand cuts looms as consumers shift their grocery purchases online or towards specialty physical retailers, who offer a more curated selection of the products once found at their local grocery stores."

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Sources: https://www.pymnts.com/news/retail/2023/grocers-losing-share-of-health-and-beauty-sales-to-ecommerce/