Online Grocery Consumption: History
Please note this is an old version of this entry, which may differ significantly from the current revision.

Because of e-commerce growth, the grocery (FMCG) industry is also equipped with advanced technologies such as the Internet of Things (IoT), cloud computing, and block chain technology. 

  • consumer adaption of technologies
  • consumer trust
  • perceived risk
  • online shopping
  • artificial intelligence

1. Introduction

E-commerce industry has witnessed a phenomenal growth due to the rapid advancement of mobile internet technology and technophile customers. Many traditional industries, such as FMCGs, are attempting to capitalize on the market opportunities presented by transformation and up gradation. Previously, online shopping was only available in a few product categories and to a select group of consumers. The volume of global online commerce has increased significantly, owing to the recent COVID-19 crisis [1][2], which has accelerated the growth of e-commerce. The devastating effects of the COVID-19 pandemic on the global economy as a result of lockdown, physical facility closures, perceived risks, and personal safety concerns [3] are some of the influencing factors building consumer intention to purchase even grocery products online. In recent years, a large number of e-commerce firms have entered the FMCG sector in the hope of creating value and sharing market benefits. Online grocery shopping is becoming an increasingly important part of life for customers all over the world, and it has fundamentally altered the way people shop for groceries. Because of the omnipresence of technology and the consumer convenience, online shopping has grown significantly in terms of volume as well as use.
The COVID-19 pandemic has motivated consumers to accept technologies and purchase grocery products online. Newer technologies and business models, as well as big data/predictive analytics, indicate that the shopping experience is about to take a quantum leap into an unknown shopping realm [4]. Many studies on customer behavior [5][6], new business models [7][8], retailing technologies such as virtual reality [7][8], and changes in retailing reality in certain shops [7] indicate the relevance of new technology in retailing. Changes in the internet’s rapid expansion are now influencing the retail-shopping model, with the use of new technology to enhance the whole consumer shopping process, placing pressure on traditional company strategies to adapt. In the grocery industry, there are three sorts of business models. These include “brick and mortar” used in conventional retail chains, “pure-play” used only by online merchants [9], and “bricks and clicks” used by retailer traders online and offline through their offline chain shop (known as multichannel retailing) [10].
The global spread of the COVID-19 epidemic has changed people’s shopping habits and perceptions of e-commerce. The country’s enforced lockdown regulations, as well as customers’ rising reluctance to venture outside and buy for necessities, have pushed it into e-commerce. Consumers have shifted their purchasing habits away from shops, supermarkets, and shopping malls and toward online portals for products ranging from necessities to branded goods. Indeed, the COVID-19 emergency declared in March 2020 gave a strong boost to food hoarding [5][7] and online shopping for food products, with an increase in the number of customers buying foods online to comply with the rules (particularly social distancing)—and simply to ensure they get the food they want instead of facing empty shelves. The COVID-19 pandemic has posed many challenges before business houses and consumers also. Consumer adaption of technology in exploring online shopping of grocery items has motivated them to choose this topic as subject of research. Many studies have shown that, despite technological advancement, its acceptance and influence in building intention to purchase grocery products online is limited. Two important factors that influence low acceptance of online e-commerce platforms are perceived risk and consumer trust in online transactions. As a result, two fundamental questions arise: (a) what factors influence consumer acceptance of technologies for online grocery shopping? and (b) whether consumer trust and perceived risk associated with online platforms mediate the relationship between consumer acceptance of technology for online grocery purchase intention.

2. Background of Online Grocery Consumption

2.1. Consumer Trust and Online Grocery Purchase Intention

Accepting online shopping technologies and facilitating any transactions requires trust. Because it is a virtual transaction, trust is more important in E-commerce than in offline transactions. Consumer trust is critical for increasing consumer acceptance of new technology in online shopping and assisting in the process of e-commerce expansion in various retail product categories [11][12]. Trust is positively influenced by technical security features, simplicity of navigation, information display method, and an individual’s verification. Trust is a key component in developing buy intentions and establishing long-term consumer connections for repeat purchases and loyalty. Trust is positively influenced by technical security features, simplicity of navigation, information display method, and an individual’s verification. Because cognitive and emotional trust influence consumer acceptance of the ideals communicated, trust also has a hierarchical influence on perceived value [13]. E-retailers should consider that they could achieve greater success if they assure customers that their personal information will be safe, and they can increase their trust by providing facilities that provide more secure transactions when they do online purchasing. According to [14], trust is an evaluation of one’s relationships with another person who will carry out certain transactions in line with the expectations of people who carry out transactions in an unpredictable environment. This trust does not emerge quickly; it must be nurtured and continuously proven.

2.2. Perceived Risk and Online Grocery Purchase Intention

According to available research, consumers continue to believe that using the Internet for purchasing is risky [15][16]. Furthermore, whether or not a person makes an online purchase, these perceptions can have a significant and inverse relationship with attitudes and intentions [17][18]. Consumers’ propensity to order groceries online was observed to be very low. The spread of the COVID-19 pandemic, on the other hand, has compelled many customers to shop online. Despite technological advancements and the exponential growth of internet services in business facilitation and retail modeling, organized retailing only accounts for 19% of the retail market [17][18][19]. This means that some factors are impeding the growth of online marketing and online transactions in such product categories. One of them is the customer’s perception of risk associated with online purchase. Retailers must comprehend the issues associated with perceived risks and devise solutions. The fear of the unknown is the main factor that prevents customers from purchasing via the Internet. Because of a number of problematic causes and concerns, some people have negative impressions about e-commerce purchasing behaviors. The fear of the unknown is the main reason that prevents people from purchasing through the Internet. Some people have bad impressions about e-commerce purchasing activities owing to a variety of problematic causes and worries. While both security and privacy are essential, clients are more concerned about security than privacy. If online clients’ actual purchase experiences diverge from their purchasing intentions, they will perceive a higher level of risk [19]. According to Cox and Rich [20], perceived risk is determined by the subjective ambiguity of the consequences.
Consumers will have multiple buying goals or expected results of purchasing items or services for each purchase choice. Several forms of perceived risk have been widely employed in past study, and it has been discovered that consumers appear to be cautious while purchasing online [20]. Pentz et al. [21] explored the consumer adaption of digital technologies in online shopping and found significant different in dimension of perceived risk in online shopping among experience and inexperienced online shoppers for different categories of products. Pham and Awan [22] found COVID-19 played a moderating role in consumer utility awareness, which encouraged shoppers to shop online. However, society’s affection may be a factor in consumers’ reluctance to shop online. Meanwhile, contrary to previous research, awareness of the COVID-19 pandemic and marketing policies have no significant impact on online shopping during the COVID-19 pandemic. According to the previous research findings, perceived risk is an important factor in explaining consumer behavior. As previously stated, consumer purchase intention and purchase behavior can be viewed as an example of risk-taking, based on the fact that any action taken by consumers will have consequences that they cannot predict with any degree of certainty, and at least some of which are likely to be unpleasant If perceived risk is powerful in explaining customer behavior, consumers’ reluctance to purchase online could be a direct result of perceived risk, particularly in emerging markets.

2.3. Consumer Technology Acceptance, Perceived Risk, Trust and Online Grocery Purchase Intention

The relationship between consumer trust, perceived risk, consumer acceptance of technology in online purchase of FMCG product has been extensively searched in many studies. A review of the literature on some of the factors of consumer acceptance of online grocery shopping is presented below. It has been demonstrated that social influence has a major impact on human behavior in general and technology adoption (TA) in particular. Several studies have been done to investigate the function of social impact in the adaption of online shopping technologies, and it has been shown that social identity and group norm have substantial effects on consumer involvement. Positive social influence has been found to enhance the link between beliefs and attitudes regarding online buying, as well as the relationship between attitude and shopping intention. In terms of consumer online shopping behavior, authors like Pascual-Miguel et al. [23] and Ingham et al. [24] indicated that social influence may be handled through the impact of individuals like family, friends, and coworkers to whom the customer could seek knowledge or social approbation to utilise online shopping. The previous work related to many online buying research like Zhou, T. [25], Lorenz et al. [26]. Matthew et al. [27] (have confirmed the impact of social influence on consumer intention to use online shopping.
Venkatesh et al. [28] define effort expectancy as the amount of comfort associated with the use of any system. This means that effort expectation relates to the amount of work required utilising the system, regardless of how simple or complex it is. Users may readily embrace and utilise user-friendly technologies. As a result, effort expectation is expected to have a significant influence on buyers’ intentions to use online purchasing. Ingham et al. [24] experimentally revealed a strong relationship between perceived ease of use (as a comparable factor to effort expectation) and customer attitudes about online purchasing. Pascual-Miguel et al. [23] recently confirmed that females’ desire to use online shopping is significantly predicted by the function of effort expectation, while this link is more likely to disappear for male groups. Mandilas et al. [29] found a substantial direct link between perceived ease of use and customer intent to utilise online purchasing.
The extent/degree to which an individual feels that adopting the system would help him/her achieve increases in work performance is referred to as performance expectation [28][30]. This element, like perceived usefulness from TAM, is acknowledged as a critical component in shaping an individual’s attitude toward utilizing any technology [31][32]. According to [33], the degree to which a person believes that using a certain biometric technology will fulfil the organization’s security access demands in a specific region is referred to as performance expectation. Indeed, either performance expectation or an equivalent concept captures the cognitive gains expected while utilising a new technology. Importantly, such benefits have been widely seen to have a substantial effect on people’s perceptions and desire to embrace various types of apps [34][35][36]. Customers’ intentions to utilize online shopping were also found to be significantly predicted by the function of perceived usefulness, a concept related to performance expectation. Performance expectation has been found to specifically, substantially, and favorably impact one’s behavioral intention to adopt and use an IT system [36][37]. Facilitating conditions refer to a person’s belief that organizational and technological infrastructure exist to facilitate system utilization [28]. It refers to external elements such as infrastructure and resources that influence the desire to buy food online in the context of this study. Hedonic motivation refers to the effect of a person’s pleasure and pain receptors on their desire to go towards a goal or away from a hazard. The capacity of the web and e-commerce platforms to give hedonic, non-functional value to online consuming experiences is widely known, as is the importance that customers place on hedonic benefits. Martnez-López [38] developed a perceptual behavior theory (PBT) and applied the technology acceptance model (TAM) to explore the influence of trust, perceived danger, perceived utility and perceived ease of use on purchase intention.
The relationship between consumer trust, perceived risk, consumer acceptance of technology in online purchase of FMCG product has been extensively searched in many researchers. Bianchi and Andrews [39] examined the influence of trust and risk on the purchase behavior of Latin American consumers. Perceived risk and trust variables, according to the data, had a favorable effect on the desire to continue shopping online. Consumer attitude influences their propensity to buy online, and perceived danger has an inverse connection with attitude. Juaneda-Ayensa et al. [40] examined the major determinants of technology adoption and use, as well as their influence on buy intent, which underlies multi-channel consumer behavior. Nagy and Noémi [41] investigated how consumers adopt and use Artificial Intelligence (AI)-powered online shopping. The study looks at consumer trust and acceptance of AI in online retail. An online survey was conducted in Hungary to create a database of 439 respondents for this study. Trust was discovered to be one of the most important factors influencing consumer attitudes toward AI. The other key factor in attitudes and behavioral intention was discovered to be perceived usefulness, which was found to be more important than perceived ease of use. According to a similar study by [42], consumers still have the choice whether to use new technology, such as shopping online in an AI web shop, or not.

3. Implications and Conclusions

Based on the findings, the emergence of the pandemic brought changes in consumer perceptions towards contactless shopping. Because of the importance and variety of hedonic motivations in online consumption experiences, company marketing strategists must pay close attention to them when deciding on website design and configuring online media strategies; this is especially important in the current context of social media. Even in online consumption processes that are heavily geared toward achieving instrumental goals. Online grocery marketing firms must continue to promote marketing strategies that stimulate consumer shopping needs by providing more purchasing options, particularly more policies that help customers gain trust in the online system and develop consumer trust in the contactless transaction system. True to reality, hedonic incentive, facilitating conditions, and social influence are all major elements influencing consumer purchasing decisions in India. Before making a purchase, people often seek the advice and opinions of family members or former purchasers.
It can be seen that the information India consumers receive from others, whether through any form and means, has a significant influence on the buying decision of them. Perceived risk and customer trust are other important areas for online shopping platforms. The impact of COVID-19 will be apparent for coming months. Online grocery shopping platforms must realize the fact the modern consumers are more concerned about perceived risk and trust associated with technology acceptance. As the number of online frauds and concerns toward privacy and safety have increased, online platforms must explore ways to gain customer confidence and trust. In order to reduce consumer perceived risk and gain their trust, these platforms must focus on their efficient and safe deliveries, clearly demonstrate the values and quality of the product, utilize a user-friendly interface to avoid customer confusion and reduce effort, conduct promotional campaigns to attract potential consumers and provide appropriate information. Referral programs and encouraging satisfied customers to write positive reviews could be the other possible strategies to attract customers and gain their trust. Online grocery shopping platforms need to be more professional, change faster, grasp technology trends to better meet the needs of consumers not only amid pandemic but also in the post pandemic period also as in a long run online shopping trend is expected to grow faster. In particular, the process of return, exchange or refund should also be focused and designed in a simple way to enhance the experience of online shopping for consumers.

This entry is adapted from the peer-reviewed paper 10.3390/su131810221


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