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IJRAR19W1503 International Journal of Research and Analytical Reviews (IJRAR) www.ijrar.org 48

GOING BEYOND URBAN: ONLINE GROCERY

DELIVERY EXPANDING TO TIER-2 CITIES

INTRODUCTION

The internet has done a noteworthy job in helping shorten the space between individuals and their possibilities, by introducing

online services and ventures. E-commerce is expanding throughout the world and giving better outputs every year. These online

marketplaces are offering all kinds of products to fulfil both tangible and intangible needs of the consumer. While products like

computer appliances and accessories lead the market share, products like household goods and groceries are struggling to catch

the attention of consumers purchasing online. Generally, groceries are bought in a set-up where the customer can review the

item before purchasing. The feeling of touch, smell and sight straightforwardly influences the buying decision of customers.

Additionally, markets are not simply restricted to only perishable products, solid eatables, (for example, canned and packaged

food) and non-food products, for example, household appliances are likewise accessible. Thus, shopping for food turns into a

genuine endeavour where strong senses help decide the decision.

Online shopping for food looks encouraging when contrasted with different items accessible on the web however it faces rather

various difficulties of its own for its purchasers and vendors. conveyance/transportation of delicate things turns into a sensitive

issue. the purchaser is simply not intrigued enough to leave their routine grocery shopping habits and change to new ones;

paying little heed to the amount of money and time that could be saved. It is vital to explain the factors that impact purchasers

towards buying grocery products through an online grocery store. Online Grocery Stores have a great deal of potential as

Generation Y and their forerunners usually use this innovation to save time and seek convenience. These new consumers of

online grocery shopping are more educated and are willing to take risks. These individuals are willing to try new things and find

easier solutions for their problems.

Through this research, we aim to find the key factors that help in increasing the adoption of online grocery stores, what is the

current attitude of consumers towards online grocery stores and what do the consumers want from an online grocery store. There

have already been many studies done on this topic, but none so on the tier-2 demographic. Since a large population of India

resides in these areas, learning about the consumers of this area can help online grocery stores to find a breakthrough into this

complex market. Also, there has been an increase in the internet and mobile penetration in this area. We feel that with the

increase in purchasing power, these consumers would make an ideal customer base for any online grocery store.

Effects of COVID-19 on e-grocery Industry

More than 90% of countries and territories have reported more than 5 million cases and 0.3 million deaths due to an infectious

virus called coronavirus (COVID-19) (Source: covid19.who.int). This virus is highly contagious and is spreading across the

globe rapidly.

For the public's welfare almost, every country has put themselves under lockdown including India. People of every grade are

practicing social distancing and are staying at home. Although the lockdown is in the best interest of the common people, it

certainly has its consequences. For example, we are witnessing some unfortunate changes in the economy of the world. The

outbreak of coronavirus and lockdown imposed by the government has built panic between the masses, due to which they are

stocking up consumer goods (Atta, rice, pulses, sugar, edible oil, etc.) and sanitization goods (sanitizer, toilet paper, tissues,

etc.), which are supplied by three different markets in India. Firstly, the unorganized sector, which is the Kirana Stores, having

a market share of about 95% and organized sector which includes Retail chains with 4.8% market share and also E-commerce

platforms with 0.2% of market share. (Source: www.news18.com)

While there has only been 0.2% market share of e-commerce platforms in India, the scope of this market has risen with increase

of internet usage and users. This market is led by two big players, Big Basket and Grofers with about 60% of market share

(Source: dazeinfo.com). Although they have failed to produce good results in tier-2 cities. But there are some bootstrapped

players which have started from these cities. This time, e-grocers have seen five times increase in the order volumes as many

large retail stores were shut to maintain social distancing.

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1. PROBLEM RECOGNITION

PROBLEM RECOGNITION

India is a huge market and it is known that the cities categorized under Tier 1, Tier 2 and Tier 3 serve as the basis for

segmentation for marketers. Due to globalisation, many new industries that are growing fast in India are gradually covering

the entire nation in terms of market. Following are fastest growing industries in India:

1) Food Industry

2) Tourism Industry

3) Healthcare Industry

4) Education and Training

5) Retail Industry

As in an article of Economic Summit, a research published to institute Oxford Economics, the Top 10 Fastest Growing Cities

by GDP will be India from 2019- 2035.

Fig. 1

It is eminent from the data that Tier 1 cities will be the attraction spot for companies to market their products through traditional

as well as increasingly exclusive ways, to establish their businesses. There is no doubt that new businesses and start-ups

(National and Multinational) based on unconventional platforms (digital and online) are and will continue to expand their

marketing programs to capture the consumers of these promising cities to sell their products.

For Example, despite of prominent establishment of industries such as, Financial services (Paytm, UPI, Google Pay, MyJio

App), Educational (Udemy, Unacademy, Byjus), Healthcare (MedLife, FitBit, PharmEasy), Tourism and Stay (OYO, Make My

Trip) most of their target segment is from Tier 1 cities only. Leaving behind the Tier 2 cities and the last to reach, yet growing

Tier 3 Cities.

It is important to observe that at present, around 96% of India’s consumers are from tier-2 and tier-3 cities. Around 50% of the

country's GDP is given by these cities. Yet, the contribution of these new businesses is minimal. The biggest industry in Tier 2

and Tier 3 cities continues to be (and will be) Agriculture which gives the country its maximum consumption and GDP.

However, looking back at the new online based businesses that have recently emerged, there are many reasons for the less

effectiveness of reach in Tier 2 and Tier 3 cities also known as the rural cities. One generic reason being many of the marketing

efforts that are more advanced than the conventional methods are not reaching the homes in these cities, due to a vast variety of

reasons. However, there is still immense scope in these areas due to the following:

1. The level of online penetration is gradually increasing in the rural market. Online penetration includes social media

platforms like Facebook, Tiktok, WhatsApp which are consumed in larger amounts in rural areas day by day.

2. Despite the online penetration, government programs like Rural Electrification Programs (REP) since 1970 and

initiatives by FMCG companies like Project Shakti and E-Choupal has introduced good distribution and marketing




(including the 4 P’s of marketing i.e. Product, Price , Place, Promotion) in rural areas and opened doors for new

marketing programs. Hence these areas are less likely to continue to be remote or unreachable (for products of the

marketer’s) providing more scope to marketers for Integrated Marketing Programs.

Narrowing down the segment and the business of our concern, we have picked “Online Delivery Stores” among the new growing

online businesses.

Industry -Online Grocery Delivery (Retail): Grofers and Bigbasket (Online Applications) - A category of home delivery of

basic household items and grocery as its major product (and complimentary and additional offerings). These are growing but

not yet established like the big online retail stores like Amazon and Flipkart in India. It’s product differentiation from these big

stores is that they focus more on vegetables and fruit delivery along with the daily “Rashan”, which is its positioning for the

Indian market.

Segment - Tier 2 cities: It is found that the segment which has the online delivery market’s maximum share is the Tier 1 cities.

Which shows that people who use these are mostly from Tier 1 cities and not Tier 2 or Tier 3. However, we see it ideally targets

Tier 2 cities as well, because the practice of rashan buying is a prominent culture and a necessity of the middle-income

households that are seen majorly in Tier 2 cities, hence as a marketer it is seen that Tier 2 cities are potential segments.

Problem : Why Tier 2 cities are not buying from Online Delivery and Can we move a step closer to make them use Online

Grocery Stores, and How can we do that through a marketing program?

Problem: Our problem formulated from above is that :

1) To analyse consumer behaviour with retail purchase industry in Tier 2 cities

2) To conduct research to find why Tier 2 cities do not use Online Grocery Purchase

3) To make Integrated Marketing Communication for hypothetical online delivery in Tier 2 cities




3. LITERATURE REVIEW

LITERATURE REVIEW

1. Customer Purchase Behaviour

According to Kaushik V. Pandya and Jagdish Vallabhaneni (2012) [1] UK online grocery is far ahead of India because Indian

consumer are relying on the traditional way of purchasing, though the technology has taken a next step with the usage of debit

cards, credit cards and e-wallets.

1.1 Knowledge and Cognitive Thinking

Consumer behaviour and purchase decisions usually arrive at the affective and cognitive stages. And it is difficult to get into

the cognitive thinking process of tier 2 customers, because it evolves from knowledge and evaluation of retail products which

they usually buy from unknown and varied sources (Kirana stores, Local vendors, online stores etc). And these stages imply the

consumer’s decisions, on whether to use credit or debit card, buying behaviour congruences, social and mutual decisions,

shopping on credit from the shopkeeper and also to avoid paying for the extra cost of online delivery.

1.2 Combined Experience in Grocery Buying

According to Bikramjit and H. Pradeep and Manaswini (2018) [2] there are four factors that decide whether a particular

consumer will ever purchase grocery online or not and they are- risk, convenience, compatibility, flexibility. Sensory assortment

is the manner in which the product categories, information and visuals are placed in the website. This is a competitive advantage

for kirana stores as real visual and sight of shelves are an added benefit to kirana stores. Transaction security is the payments

security, page of payment which builds consumers' trust for doing transactions. Whereas, Tier 2 customers use less online

services so these factors can be converted into a simpler term as experience. The experience of consumers will involve the

degree of these factors and will simply depend if a consumer has used online shopping app even once in their lifetime. Our

research will take experience as a variable to know

consumer behaviour.

1.3 Convenience

Bikramjit and H. Pradeep and Manaswini (2018) [2] also included that convenience in many Tier 2 cities is a part of experience,

this also includes features like website access, ease of product selection, etc. But their study didn’t compare convenience with

the kirana stores. So, our aim in the study will be to find whether the percentage of total experience emerging in tier 2 cities is

more for kirana stores or for online delivery, whether those who have experience in online grocery still choose to buy

from kirana stores or are slowly switching to online buying.

2. Purchase Decisions and Evaluation Criteria

2.1 Experience Evaluation-Cost of delivery, price, quality, product range

Ramus and Asger Nielsen (2005) [3] mentioned that the loss of recreational arena of product purchases and delivery of inferior

quality products is the disadvantage in the minds of consumers that have low experience in online shopping and contradicting

belief was they prefer online mode for convenience, product and category range as well as the discounted pricing. So, the

cheaper prices are offered by Big Basket than Kirana stores. And according to Yan Huang (2006) [4] delivery charges are not

the most important factors when it comes to online grocery shopping as consumers are more concerned about the travel time

wasted by them if they do grocery shopping by themselves.

The convenience and risk are perceived differently by consumers of different demographics and hence we might see a new kind

of trend in our research as it on tier 2 customers of India.

2.2 Substitutes Available

In a study by Sinha, P.K., Gokhale and Rawal (2015) [5] found that for fruits and vegetable shopping both organised and

unorganised sector consumers depend on the location of the store, prefer perceived quality check, product range and geographic

area. The consumer profiles such as age is also an important factor. In our study we will see vegetable vendors, unorganized




fruit vendors which are located majorly in geographic area of Tier 2 cities and their behaviour towards different substitutes

available.

2.2.1 Buying behaviour - Substitutes or complements

According to the research by Robinson Helen; Dall’Olmo Riley Francesca; Rettie Ruth; Rolls- Willson Gill (2007) [6] people

in UK refer to online buying behaviour as complementary to traditional modes of purchase behaviour rather than a substitute.

What we don’t know is, that in Tier 2 cities kirana stores and vegetables vendors will remain substitutes or act as complementary

product or co-exist individually, so, we will also find if there is a scope of people preferring a synergistic integration of both

kirana stores and internet grocery.

2.2.2 Trust

According to Harsh Sharma et al, in study [7] consumers depend on 8 key factors, some of them are: - store personnel, store

reputation, location routine, relationship. They also value the employment generation in unorganised sector and depend a lot on

relationship to sustain their family buying. We propose that consumer in tier 2 buy from kirana stores because of trust they have

formed with kirana stores over a period of time.

2.2.3 Relationship

A research on retail store practices [8] mentions that consumer’s willingness in bottom of the pyramid to buy from shopkeepers

and kirana stores are due to the relationship and trust that is built for a long tern loyalty, in our study we will consider that what

percentage of tier 2 people buy from kirana sores because of the relationship they developed consequently.

2.3 Frequency of purchase orientation

Here also the daily routine, family consumption patterns, needs of upgrading, continuing grocery supply impacts the frequency

of purchase whether they buy in bulk monthly or buy as needs arise from nearby kirana stores, the relationship with kirana store

owners also provides customisation according to frequency of purchase to give comfort and convenience which is an added

benefit of kirana stores. By knowing the frequency of purchase of tier 2 cities, online stores can keep adjusting, hence we will

find frequency of purchase as a part of research.

Himanshu and Kanav Mittal have mentioned in their research [9] that expectations of people buying on various platform is

different, and mostly working segments use online grocery where time saving is the key point, but in our study for tier 2 cities

we can form hypothesis that consumers who are not working do not use online delivery.

2. Switching with Value Addition

3.1. Farm Fresh Provision

In an article on “Attracting consumers of locally grown products” (2001) [10], a study of 500 correspondents and households

in Wisconsin was conducted to see the behaviour of the consumers towards organic, herbal, or virgin, natural, farm fresh grocery.

It was found that people would choose quality, taste, nutrition, but if it is available in nearby locality or general sellers, and

would pay equal price as other products for it from the shop that provides this. They were also ready to pay a premium for farm

fresh and better-quality product if readily available but would not go an extra mile to buy it. Our focus of study will be to find

how people in Tier 2 in India behave likeably, neutrally or negatively to provision of farm fresh grocery, through online mode.

3.2. Discounts and Offers

Chitra Sharma (2015) mentioned in her article [11] that consumers prefer buying goods from online grocery delivery platforms

on the basis of factors such as offers and discounts, free home delivery, etc. According to Chitra Sharma, that giving discounts

is a good method of making customers switch from traditional forms to online shopping.

In an article by Bhumika Khatri (2019) [12], explained that Zomato and Swiggy, Indian e-commerce start-ups for restaurants

food aggregation fulfil over three quarters of all food orders in the country in which, as per their research, Zomato app has been

downloaded in 12% of smartphones and Swiggy app has 10%. The report further highlights the penetration of the apps are

higher in tier 2 cities than in metros. Increased internet usage, smartphone penetration and logistics were not only the factors

influencing Indian population. The tier 2 people adopted these apps because of some marketing techniques used by them like

Zomato gold reward programme, Swiggy pop, sponsoring in events like cricket world cup, Indian Premier League, etc. With

the example of Swiggy and Zomato, we can conclude that good marketing strategies and different offers are crucial source to

attract the people of tier 2 cities.




In our study we will also propose that with Farm Fresh Provision and Discounts and Offers, non-online consumers will prefer

and switch to online retail like Grofers and Big basket and also find the percentage willing to prefer online grocery given the

two value additions.

4. Covid-19: Seasonality or Short-Term Economic Downfall

In a recent article of Jill E. Hobbs (2020) [13] found that how food industry and food chain has been interrupted due to the

Covid-19 outbreak and he has researched on the possible mid-term, short-term, and long-term effects. What the article lacks is

few insights on how e-retail and home delivery will be affected.

Referring to this research there are going to be permanent economic alter and so we propose that if Pandemic continues it will

act as seasonality where retailers need to treat COVID 19 as a constant seasonal variable depending on the fluctuations in

severity of pandemic in the economic model and while inducing or researching a technique. Based on this we will find about

advertising and consumer behaviour that will affect the IMC models.

4.1 Advertising e-grocers

According to this article of Aditi Shrivastava and Alnoor Peermohamed (2020) [14] it is found that during coronavirus customer

visit on e-grocery apps have increased by 60 to 70% and the basket size hiked by 15 to 20%. It will be a significant opportunity

for e- grocers to retain their first-time users after this pandemic. Although, Satish Meena, a senior forecast analyst, Forrester has

analysed that this demand won’t last forever since customers have been stocking up goods and will not re-purchase for at least

2 to 3 weeks. But certainly, this pandemic has created an awareness in tier-2 cities, just as demonetization did for payment apps

in 2016. One of the leading payment applications, Paytm, traffic increased by 435%, app download grew 200% and there was

250% rise in overall transaction after that [Source: www.appknox.com]. Though, in this situation customers would not lose

buying options but certainly the purchase intention would grow for e-grocers. Hence, there is a scope for e-grocers to grow their

market in India, it will be interesting to see the results after this as consumer behaviour is difficult to predict.

4.2 Prediction on consumer behaviour Post Covid-19

Some prediction on consumer behaviour post Covid-19 is shown by Dr Jones Mathew (2020) [15] in his article. According to

this article, lockdown, the result of Covid-19 has helped few companies to advertise themselves beyond they could ever imagine.

Consumers preferences have changed drastically, as it has shifted towards convenient method of purchasing online.

Due to Covid-19 some factors are added in consumer behaviour for purchasing grocery. Physical distancing has become a

motivation for consumers to buy grocery online because people feel safer and secure staying at home. Consumer are becoming

more and more hygiene concern, so it will become a major factor to attract consumers. There are festivals and rituals which

Indian consumer will not let go this easily so they will be influenced by offers given by companies during those festivals. There

would be unsure spending power of consumers because of job losses, pay cuts and lower spending but positive actions by

companies during that time will be a catalyst for influencing customers. This lockdown is affecting consumers psychologically;

which can be positively solved by motivational ad campaigns by the companies. In this study, we will go through some consumer

behaviour towards e-grocery stores during this pandemic time and form our prediction on consumer behaviour towards online

grocery post this pandemic.




3. RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

Research Design

The research targets the sample population of consumers drawn from Tier-2 cities of India, who have or don’t have any previous

experience of ordering from an online grocery store. Only primary data collected through Google Forms has been used.

• Primary Data

The sample size of the study is 100 individuals and it employed snowball and purposive sampling techniques to get data

from the respondents who were best suited for our research. The primary data collection was done through Google Forms

using questionnaire technique.

Sample Design

Size of sample

A number of 100 respondents that belong to a tier-2 city have been selected for the research.

Research Techniques

We are seeking a precise conclusion to an established issue. In this research, we have explored the main aspects of an under

researched problem. Following are the methods of research.

1) Deductive and Inductive reasoning

2) Hypothesis Testing

Data Collection

The research questionnaire caters to four sections of questions designed to know different aspects of the respondent. Section

one includes questions related to the demographics of the respondents such as the age, gender, occupation and the city they

reside in. Section two of the questionnaire consists of questions on the current purchasing behaviour of the consumers, such as

the frequency of their purchase and the places they buy their daily grocery items and fruits from. Depending on whether the

respondent has ever shopped from an online grocery store, they are led to different parts of the questionnaire. For respondents

who have an experience in online grocery shopping, the questions focus on how their purchase patterns have changed due to the

coronavirus pandemic, what difficulties they face while shopping online and also what products they buy from an online grocery

store. Likert scale questions

have also been included to know whether the respondents are willing to completely switch to online grocery stores and how

likely are they to recommend online grocery to others. While for respondents who haven’t ever purchased from an online grocery

store, their questionnaire focuses on whether they are aware about online grocery stores, why they prefer physical stores over

online stores, why haven’t they ordered from an online grocery store and what conditions or offers motivate them to shop online.

Likert scale question has been used to understand the consumer purchase intention.

Objective

To solve following research questions:

Q1) What variables affect consumer behaviour with grocery shopping in Tier 2 cities and how?

Q2) How segments in Tier 2 cities and percentage of consumers differ in attitudes towards online grocery shopping?

Q3) How should an ideal marketing programs for online grocery services be in Tier 2 cities?

Q4) How Covid-19 Pandemic has affected the consumer behaviour of tier2 cities towards online grocery stores?




a) Qualitative Method

Parameters

In our study, we will be studying the four parameters to judge and derive the retail purchase orientation and overall consumer

behaviour towards online grocery stores such as Big Basket, Grofers and Dunzo with Brick and mortar stores; the research will

find the four parameters defined-

1. Substitutes – The percentage consumption and use contributed to substitutes available in the grocery retail industry.

2. Experience- The combined total experience of a user based on convenience, assurance, perceived risk, and sensory

assortment. It is assumed to be a total experience if the respondent is through a past online purchase.

3. Frequency- The timeliness of purchase needs a pattern of repeat grocery purchases.

4. Knowledge- The awareness alone wholly contributes to knowledge but convenience sensory assortment, assurance, and

perceived risk contributes partially because respondent experienced decision making and cognition but left at the

purchase (Payment Page) stage. Considering 100% awareness of experienced respondents, we do not take the count of

people who have already once purchased online, but only the ones who have zero experience.

b) Quantitative Method

Conducting quantitative tests and data analysis for hypothetical assumptions

Hypothesis

To test following hypothesis which can generate solution to our research problems:

H1: Tier-2 consumers are not aware about online grocery stores

H2: Tier-2 consumers don’t have a positive perception of online grocery shopping

H3: Tier-2 consumers don’t have experience of online grocery shopping

H4: Tier-2 consumers don’t find online grocery shopping easy

H5: Tier-2 consumers find online grocery shopping risky

H6: COVID-19 pandemic has increased the amount of online grocery purchase in tier-2 cities

H7: People are willing to switch to online grocery stores if they are offered farm fresh products

H8: People will switch to online grocery shopping if they are offered discounts.

H9: Tier 2 cities needs integrated marketing communication instead of direct marketing communications for online grocery

delivery to penetrate deeper




5. DATA ANALYSIS AND FINDINGS

DATA ANALYSIS AND FINDINGS

The percentage finding of 4 parameters - Substitutes, Frequency, Experience, Knowledge that indicate shopping behaviour

orientation & consumer preference for online or physical grocery stores are as follows:

1. Approach/ Method:

Deductive reasoning is the approach to form inference from the conclusions as facts. Conclusions are facts derived by forming

qualitative measures to the logical numeric data.

a) Substitutes

Fig. 1.1

Fig. 1.2

Conclusion

1. Street Vendors (78.4%) and Kirana Stores (72.8%) are maximum consumed substitutes for fruits & vegetables and

household grocery simultaneously.

2. Online Grocery stores usage is preferred least over other available substitutes




Inference

1. Traditional retail is still consumed more than modern substitutes in Tier 2 cities for both vegetable, fruits and household

groceries.

2. Physical brick and mortar like Big Bazaar are preferred over online grocery which shows least favourability towards

online stores in Tier 2 Cities.

b) Frequency

Fig. 1.3

Conclusion

1. Maximum frequency (timely need of purchase) behaviour is Weekly with 36.4% and Every 2 -3 days with 30.8%.

2. Monthly purchase (frequency) 15.9% is equal to Every Two-Week purchase (frequency) 15.9%

3. Least percentage of frequency / use pattern is for Whenever Required

Inference

1. More people do short term repurchase over a week or within 2-3 days, do not stock up the groceries over, they are likely

to prefer freshness and avoid chances of rotten grocery due to prolonged storage for weeks.

2. Those who do stock up grocery for long periods prefer stocking it for over a month slightly more than, similar to or less

than stocking it over 2 weeks.

c) Experience




Fig.1.4

Conclusion

1. More people have a past experience of buying grocery online (51.4%) than those who have never bought grocery before

(48.6%)

Inference

1. People who have single or multiple experience of only purchase are almost equal to people who never experienced

online purchase.

2. The numerical data of experience over non experience of online purchase can succeed depending on the demand and

awareness spike.

3. The data is biased towards students in count, it is inferred from the hypothesis (if true) that students bought online and

housewives didn’t.

4. Correcting the biases of students in count, the count for people having no experience may succeed the count of people

having a single (or multiple) experience in actuality.

5. The people who have not purchased and have left the last stage of payment, still gain experience.

d) Knowledge

Fig.1.5

Conclusion

1. Considering the percentage of people aware about online grocery (92.3%) exceeds largely the percentage of people not

aware of online grocery stores (7.7%).

2. The data is for the percentage of people with zero past experience.

Inference

1. The awareness is drastically increased in Tier 2 Cities, exceeding the unaware consumers, knowledge is high.

2. These are the consumers who had no past experience in grocery buying, yet the awareness levels confidently exist.

3. The awareness is high due experience in technological use (deducing from the fact that all respondents use mobile

devices) contributing as a source to the cognitive phase of online and internet shopping.

4. The ones who are aware do not have purchase experience but may or may not have exposure to convenience, security,

sensory assortment of online purchase, hence these 3 variables are partially the part of knowledge.




Covid-19 data analyses and findings

Fig.2.1

Facts: -

75% of tier 2 people were already aware about e grocery services before the breakout of this pandemic.

About 20% of tier 2 people were there who came to know about the e grocery services during the pandemic.

And one fourth from the 20% percent downloaded at least one of the e grocery apps.

Only 5% of people from tier 2 are still not aware about the e grocery services.

Fig.2.2

Facts: -

14% of people started buying groceries online during COVID-19 pandemic.

There are about 38% of people who did not buy groceries online during this pandemic.

There were 22% of people who were already buying groceries online, and got nothing new from this pandemic.

11% of people buying groceries online during this lockdown were not satisfied with the service.

14% of people showed interest in buying groceries from online platforms after we took their survey.




Fig.2.3

Fact: -

42% people’s grocery purchase increased from online platforms during this pandemic.

Fig.2.4

Fact: -

62% of people want to continue online grocery shopping even after the lockdown is lifted.




Inferences: -

From the above facts and collected qualitative survey some inferences are drawn using deductive method of research: -

1. In total 95% of tier-2 people are aware about the e-grocery services.

2. But even after good awareness and Covid-19 Pandemic (a situation where physical distancing is necessary and grocery

has become a main survival) there is about 55% of people who did not bought grocery from online platforms for even

once during this time and also percentage of people who have tried buying once but did not had a good experience.

3. This can be because of some reasons like: -

No services like this are available in their city.

The situation of Covid-19 has increased the hygiene concerns, so people do not feel secure buying groceries from these

online platforms.

Covid-19 has increased the demand for groceries, so people are not getting appropriate delivery slots or it's showing a

long time to deliver the groceries.

Or people facing difficulties in finding products they require.

The situation of covid-19 has made companies reduce the option of Cash on Delivery, so this could be a reason for

people not using e-grocery services to buy their groceries.

4. There is some percentage of people who have started buying online grocery during this Covid-19 outbreak, and if not

then they want to buy.

5. The situation of Covid-19 has helped online grocery stores to build customers as 42% people’s grocery purchase has

increased during this time from online stores.

6. And also, pre Covid-19 there were almost 22% of people who were buying their grocery online but as per survey and

Fig- 2.4 there are about 62% of people who will continue buying grocery from these platforms.

Hypothetical Model of Ideal Online Grocery Delivery Communication

Marketing Communication to penetrate in Tier 2 Cities.

Objectives: To know the ideal -

1) Communication strategy

2) Target segment

3) Mode of communication

Approach

1) Communication strategy; what should be the goal of the strategy

Goal: To convert users to non- users - Identify perception and weakness of online stores- It must improve an

unfavourable image.

Goal: To increase switching rate – Strategize based on weakness and strength of benchmark competitor in relation to

online sector in retail industry.

2) Target segment; improve any selected parameter and gain consumer confidence

Segmentation based on occupation- i.e. housewife, student and businessman

Segment wise advertising spend through awareness levels

Advertise to segment lacking the most in the aspect of purchase experience parameter i.e. convenience.

Target segment be congruent to awareness spend and type of message.

3) To predict the ideal mode of communication

To test the hypothesis that integrated marketing communication is the most effective media tool for Tier 2 consumers




Technique

3.1. Communication strategy - To convert non- users to users

Method - Weakness Evaluation

Weakness of online grocery purchases is correlated with their reason for not buying online implying the fact – Weakness leads

to inactivity.

Fig 3.1

Findings

1. Maximum respondents chose the following problem – Never had the need to

2. Minimum respondents chose the following problem - My servant usually goes and buy the items

Formulation

Focus level - Problem Tabulation

Focus

Level

Minimum (Ignore) Neutral (Maintain) Maximum (Highly Increase)

Problem 1 My servant usually goes and buy

the items

Tried Ordering But faced

difficulties

Never had the need to

Problem 2 Don’t know how to order No online grocery store is available in

the market.

Problem - The strategy of an ideal hypothetical communication should target on solving the problems

Focus Level – Communication should stress minimum, maximum and neutral to these problems.




Communication Strategy Application from Problem- Focus Level Tabulation

The communication campaign must identify, generate and enlighten consumers on the need to do online grocery

shopping

Inform and educate people on the availability, presence and whereabouts of their website, application and popularise

the brand

3.2. Communication Strategy - To increase switching rate

Method – To interpret competitive disadvantage

Fig 3.2

Highest chosen perception of Kirana Stores over Online Store–

1. It’s (Kirana stores) Easier to access

2. Have good relations with the shopkeepers

To increase switching - Implying the results in 1, 2, and 3,

Improve the online store blueprint such as accessibility of online stores i.e. delivery, reduce pain point by availing on

time pick-up from Kirana store on online order purchase

Advertise the relationship of the brand to consumers closely and in every aspect by promoting an integrated tagline.

Example – Amazon’s IMC of “Apni Dukan” in an attempt to establish a traditional relationship.




3.3 Target Segment and Media Selection

Awareness:

Segments aware about online grocery and not aware about online grocery

Segments answer “Yes” and “No” to awareness

Difficulties Faced

Segments facing difficulty while ordering and purchasing online. Tests the “convenience” aspect of experience.

Media

Newspaper alone contributed to awareness, (traditional media) Social Media alone contributed to awareness, Integrated - Set

of both traditional and modern media contributed to awareness. Respondents chose mix of television, social media, word of

mouth, newspaper.

Technique

1. Yes and No indicates the level of Awareness, Difficulties Faced and the type of Media selected by each segment.

2. Response to “Yes” and “No” to Awareness, Difficulty’s Faced and selection of Media Mix is counted separately for

each segment.

3. The data is standardized, since in further part of the questionnaire it gets divided based on experience which distributes

them in no order.

3.3.1 Statistics and Tabulations

Statistic showing Awareness of respondents

Awareness Housewife Student Business

Yes 0.818181818 0.367647 0.736842

No 0.090909091 0.014706 0.105263

Table 3.3

Statistics showing Convenience of respondents

Difficulties faced Housewife Student Business

Yes 0 0.161765 0.052632

No 0.090909091 0.455882 0.105263

Table 3.4

Statistics showing media contribution to awareness

Media Housewife Student Business

newspaper alone 0.090909091 0.029412 0.052632

social media alone 0 0.073529 0.052632

Integrated 0.181818182 0.279412 0.684211

Table 3.5




3.3.2. Data Interpretation (% ) and Chart Display

Fig. 3.6

Conclusion 1–

1. Businessmen are least aware

2. Housewives are less aware than students but more aware than businessmen.

Difficulties Faced (Convenience)

Fig. 3.7

Conclusion 2

2.1 Convenience is highest for housewife

2.1 Convenience least for businessmen




Media Contribution

Fig. 3.8

Conclusion 3

3.1 – Social Media alone did not contribute awareness to housewife.

3.2 – Social Media alone contributed highest awareness to students as compared to other two segments i.e. businessman and

housewife.

3.3- Integrated media mix contributed awareness to students more than social media alone contributed awareness to students.

3.4 – Integrated media contributed the most to businessmen than social media alone or newspaper alone

Result

Foundation of hypothetical model of ideal online grocery delivery marketing and communication:

1. Target segment - Businessmen and housewives will be the target segment for advertisement and campaign.

Awareness level of these segments to be increased.

2. Marketing message - Communication strategy must highlight ease, convenience and usage efficiency of online

grocery services to gain

a) Convenience advantage,

b) Convert non-users to users both,

c) Increase switching rate by establishing needs and traditional relationship to businessmen in Tier 2 cities.

3.Media Mix

Integrated marketing communication (IMC)

Integrated marketing communication connects and develops brand perception in consumers through social media, (website,

YouTube, Twitter, LinkedIn) television, newspaper, business and lifestyle magazines, billboards, banners, metro(coming up in

Tier 2), sellers, distributors and touchpoints (word of mouth) to create one whole of the message into brand image.




6. LIMITATIONS

LIMITATIONS

1. The research was targeted only towards the tier-2 population of India. But since the sample size is small, the accuracy

and authenticity of representing the whole demographic may be low.

2. Since most of the respondents were students, the data might not project the entire demographics of our sample well. It

creates standardization issues for other segments of sample i.e. housewife and businessmen etc. due to number

differentiation bias.

3. The male to female ratio of our respondents is disproportionate and hence can lead to some error in our data

interpretation.

4. People may have filled the questionnaire without interest which may have led to the collection and analysis of inaccurate

data.

5. The respondents may belong to same family and provide chances of duplications

6. The questionnaire was distributed online and does not cover an audience that is less tech- savvy, the respondents all use

mobile phones, it can be derived hence that the study ignored consumers that are less technologically advanced.

7) Data is skewed to Kanpur, Aligarh, Bareilly as most respondents belonged to this city, on the positive side the results

can be perfectly applied to these cities.

8) COVID 19 may have changed immediate situations and confused responses about issues like purchase experience

9) However, accurate predictions found for COVID-19 are low, the implications in response to COVID-19 may not be

effective in the long term.

10) The research is not conducted for any particular Online Grocery Brand, doesn’t provide brand specific conclusions and

applicable to any online grocery service.

11) Research was conducted under a restricted environment of COVID -19 and pose disadvantage of freedom of conduct.




7.CONCLUSION

CONCLUSION

Traditional retail is still consumed more than modern substitutes of retail in Tier 2 cities for both vegetable, fruits and household

groceries. Brick and mortar like Big Bazaar are preferred over online grocery which shows least favourability towards online

stores in Tier 2 Cities.

More people do short term repurchase over a week or within 2-3 days, do not stock up the groceries over, they are likely to

prefer freshness and avoid chances of rotten grocery due to prolonged storage for weeks. Those who do stock up grocery for

long periods prefer stocking it for over a month slightly more than, similar to or less than stocking it over 2 weeks.

The awareness is drastically increased in Tier 2 Cities, exceeding the unaware consumers, knowledge level is high. These are

the consumers who had no past experience in grocery buying, yet the awareness levels confidently exist. The awareness is high

due experience in technological use (deducing from the fact that all respondents use mobile devices) contributing as a source to

the cognitive phase of online and internet shopping. The ones who are aware do not have purchase experience but may or may

not have exposure to convenience, security, sensory assortment of online purchase, hence these 3 variables are partially the part

of knowledge.

In total 95% of tier-2 people are aware about the e-grocery services. But even after good awareness and Covid-19 Pandemic (a

situation where physical distancing is necessary and grocery has become a main survival) there is about 55% of people who did

not buy grocery from online platforms for even once during this time and also percentage of people who have tried buying once

but did not had a good experience.

And also, pre Covid-19 there were almost 22% of people who were buying their grocery online but as per survey and Fig. 2.4

there are about 62% of people who will continue buying groceries from these platforms.

The communication campaign must identify, generate and enlighten consumers on the need to do online grocery shopping.

Inform and educate people on the availability, presence and whereabouts of their website, application and popularise the brand.

Improve the online store blueprint such as accessibility of online stores i.e. delivery, reduce pain point by availing on time pick-

up from Kirana store on online order purchase. Advertise the relationship of the brand to consumers closely and in every aspect

by promoting an integrated tagline. Businessmen are least aware about Online Grocery Delivery in Tier 2 Cities; Housewives

are less aware than students but more aware than businessmen. Convenience is highest for housewives in experience of online

purchase. Convenience is least for businessmen. Integrated marketing communication should be the best applied media

communication program for Online Grocery delivery in Tier 2 cities.




8. SCOPE OF FURTHER STUDIES

SCOPE OF FURTHER STUDIES

1. The study covers parameters such as Substitutes, Frequency, Experience, Knowledge that indicate shopping behaviour

orientation & consumer preference for online or physical grocery stores.

2. The study also covers the situation of Covid19 and the consumer behaviour towards online grocery stores during this

pandemic time.

3. The study covers the suggested Integrated Marketing Communication Process for the e-grocery companies, which they

can adapt for increasing the purchase intention in tier2 cities.

4. But there are certain limitations in our study which can be referred from the heading of limitations, and for further

studies these limitations can be reduced.

5. There is a huge scope in this topic for further studies as people can work on how specific online grocery brands such as

Grofer’s and BigBasket can improve their distribution system and service blueprint in COVID 19 pandemic.

6. People can increase the sample size and also use more diversified samples to predict the better scope of e-grocery in

tier-2 cities of India.

7. There is a further scope in this study if it is done for different parts of India for e.g. North India, South India, North-east

etc.

8. This study can be helpful for studying the markets of different countries.




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