Why Go to the Supermarket When You Can Go Online?

Online grocery shopping is gradually drawing more Israeli customers, and supermarket chains are trying hard to make their websites easier to use.

Once every two weeks, Sigal and her husband do their food shopping in 15 minutes together at the computer. “For four years, rather than drive to the nearby supermarket, we’ve been doing our shopping on the Internet,” she says. “It’s minimum effort and maximum success.”

Sigal is a loyal Mega Online customer, mainly for the sake of convenience. “It’s not that I think they’re especially cheap,” she explains. “On the contrary, Internet shopping is expensive compared to stores in my opinion, and I’m definitely aware that prices at Mega aren’t low. There’s also a 27 shekel ($7.75) delivery fee, but that’s a price I’m willing to accept for the convenience. There’s also an advantage that on the Internet I don’t buy on impulse but follow a strict shopping list, which wouldn’t happen in a supermarket full of temptations. Also, I can compare prices between products more easily than in the store since all the prices are laid out in front of you on the Internet and I don’t need to strain too hard with calculations.”

Another major consideration that Sigal points out for having groceries delivered is her family’s third-floor apartment in a no-elevator building. “Even if I needed to go to the supermarket I would have the order delivered,” she says, “so I prefer saving my time on shopping by ordering in the evening and waiting for delivery the next day.”

In addition to the higher prices online, Sigal notes the drawback of having someone else pick fresh produce. She says usually it’s not a problem, but when fruit, for example, is not in great condition when it arrives, “I insist they replace it, even if it means an argument,” she says.

While complaints about the high prices of Internet grocery shopping in Israel are common, the chains don’t go out of their way to address them. For several years they’ve been claiming that online prices are comparable to those of supermarkets in the cities. They say that’s a fairer basis of comparison than their lower-priced suburban stores, and draw attention to the costs of technology, packing and delivery involved in online shopping.

Change of approach

Nevertheless, there has been some change in the supermarket chains’ approach in recent months as they finally discover the potential of e-commerce. They still haven’t launched marketing campaigns or encouraged customers to join the club of keyboard consumers, but they do offer specials, invest in their loyal customer base and are upgrading their websites.

Product pricing is also getting different treatment. While Rami Levy repeatedly insists his store prices will remain identical or even lower than on the Internet, both Mega and Super-Sol are reducing the gaps.

Three months ago Mega began urging customers to shop at its Mega in the City stores “because for a few shekels it’s not worth going out of the city.” A price survey by TheMarker at that time discovered that it wasn’t even worth going out of the house, because Mega’s website offered even lower prices.

In a comparison of 30 items, the prices at Mega Online were comparable to those at Mega in the City, and only slightly more expensive than the company’s lower-cost chain. There are also delivery charges, which must be balanced against the gas and time savings.

At Super-Sol the trend was even more pronounced. The Internet price of a basket of items was just 2 shekels more than at the discount chain Super-Sol Deal, and 60 shekels less than at the chain’s city center Super-Sol Sheli stores.

Such comparisons, along with the fact that the only way to compares prices easily is over the Internet, has led to a growth in online shopping. Perhaps brick-and-mortar stores won’t be empty of customers anytime soon, but many Israelis are moving their grocery shopping online.

The market research firm Panels surveyed 505 adults, including 190 who regularly buy groceries online from Super-Sol (23%), Mega (13%) or Rami Levy (12%). Buying online is most prevalent among families with average incomes and people with higher education, according to Panels CEO Sarit Sternberg. Nearly 60% said they chose which service to order from according to the prices on the website, while 40% said they use the website of the chain they shop at the most.

For 28% of respondents, the choice was also affected by the delivery area of the service. Rami Levy Hashikma Marketing, with just 26 supermarkets around the country, is at a distinct disadvantage there.

Liat, a Tel Aviv resident with two young daughters, says she does all her household shopping on the Rami Levy website but admits being forced to change her habits in order to save on costs. “The prices at Rami Levy are without a doubt lower and that’s the winning consideration for me,” she says. “But because of the heavy pressure on deliveries, I know I need to order on Monday for it to arrive the following Sunday. And my situation isn’t all that bad considering there are places where Rami Levy won’t delivery at all.”

More than half of respondents, 60%, cited the time savings as the biggest advantage of online shopping. Convenience was also a major factor; 39% said not having to leave the house was a big plus. Considering the savings on gas, 16% said they believed shopping by Internet was cheaper and 10% feel they buy only what they need and aren’t tempted into buying other items on display at the store.

However, the survey also found several drawbacks in shopping online. The inability to get a complete impression of the product bothered 59% of respondents, while 22% percent cited the belief that prices are higher online. As to their complaints about web groceries, respondents cited poor service, long waits for delivery (11%), produce that isn’t fresh (10%), and missing items due to error or because the item is out of stock (10%).

Without fresh fruit and vegetables

Ruti, from Nes Tziona, regularly shops on Super-Sol’s website, claiming it offers the lowest prices in her area. She also enjoys the convenience and appreciates being able to view her previous purchases.

“The delivery packages are organized and everything arrives at the house nicely wrapped,” she says.

But Ruti still has qualms about the service. “My main problem with the Internet shopping experience is that I can’t always count on products arriving fresh,” she says. “Therefore I buy most of my fruits and vegetables separately.”

Most online shoppers we spoke with said they’re much more satisfied now with orders placed over the Internet than in the past. Rami Levy received the highest points for service among the three chains, with 68% of its website’s customers saying they are very satisfied with its quality of service, compared to 65% for Super-Sol and 58.5% for Mega. Rami Levy was also the hands down favorite among consumers for its prices.

Ilan Assayag