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Web-based food retailing service is the new trend. It is a concept which has made headway across the world. E-grocers compete with each other as well as with traditional retailers to gain consumer attention and loyalty. Of late, even large and established traditional retailers have now joined the fray by launching their own online business ventures to reach out to a greater number of customers. Online retailers’ success depends on the unwavering commitment to deliver constant, reliable service to customers who opt not just for shopping convenience but also for product assortment and quality at reasonable pricing.

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Nowadays, many e-grocers are also offering extra services to their target consumers. How e-Grocery, an online grocery shopping & delivery service firm which caters primarily to consumers in Phoenix, Denver and Seattle competes with traditional retailers and employs marketing tactics and strategies for growth is the focal point of this paper. An Assessment of e-Grocery USA’s Competition and Marketing Strategies E-Grocery USA is a company which is a relatively new entrant in the burgeoning online retailing business.

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By offering over 25,000 items to customers seeking the one-stop convenience offered by an online store, it enters into competition not just with other online retailers but traditional sellers of food and other practical everyday items. E-Grocery’s customers are primarily the middle-income to high-income earners who are pressed for time, are rearing and nurturing families (“Profile,” para. 7) or would not want to queue or contend with frustrating and sometimes distressing circumstances offered by traditional grocery stores.

Aside from offering one-stop online convenience that does away with the aggravations posed by traditional stores, e-Grocery competes with regular stores through value-added offerings and efficient delivery service. E-Grocery offers the total e-commerce solution by offering “website ease-of-use…important in terms of convenience and time-savings – the leading reasons consumers give for buying groceries online (and) personal interface between buyer and seller and issues of service after the sale” (Ernst and Hooker, 2003, para. 7).

Less weighty than product quality and assortment and the all-important customer service but a factor nonetheless in luring target consumers are pricing strategies. E-Grocery fully knows the importance of varying customer requirements and predispositions. “Some customers want top-quality service, speed, ease of shopping and rewards – and are willing to pay a premium… some consumers don’t care about speed or service, they want a bargain (“Right Pricing Strategy,” para. 6).

E-Grocery competes with traditional retailers in this respect through a dynamic pricing and promotional strategy. By giving customers real value for money and shopping rewards that come in the form of coupons, discounts and free recipes, e-Grocery is able to gain customer attention and acceptance. These all augur well for short-term success as far as luring customers or gaining market stronghold is concerned.

E-Grocery had had a healthy starting point in online retailing, but it is up against formidable competition from big brand players with the vast resources to offer personalized service to customers. Innovation alone, however, does not ensure the business viability of an e-grocer, as may be gleaned from one firm which capitalized much on raising the bar and delivering personalized service to customers that it even launched a mobile shopping service. It still closed shop, though plans are afoot for it to rejoin the bustling online retailing business.

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Kylie Garcia

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