This report analyzes Amazon's grocery proposition in the UK. It provides an overview of Amazon's features and grocery offering. It examines awareness and usage of Amazon groceries as well as shopping behaviors. The report also analyzes Amazon's grocery categories and popular items. It looks at the uptake of subscription services and identifies issues from test shops. Finally, it outlines other non-traditional grocery channel propositions available to UK shoppers.

1. August 2012
82 Pages
£950
Non-Standard Grocery Channels
(Amazon & Beyond)
SAMPLE EXTRACT
Evolution Insights Ltd
Prospect House
32 Sovereign Street
Leeds
LS1 4BJ
Tel: 0113 389 1038
http://www.evolution-insights.com
www.evolution-insights.com 1

2. About Evolution Insights
Evolution is a leading research consultancy specialising in shopper motivation and behaviour. We deliver off-the-shelf, tailored and bespoke
research for manufacturers, retailers and agencies.
Our research and analysis helps • Evolution offer a range of products & services for
clients develop targeted shopper clients in the field of shopper research:-
marketing initiatives designed to
• Off-the-shelf research
influence shoppers at the point of
purchase. – Evolution’s off the shelf research
publications deliver affordable insight
into shopper motivation and
behaviours in UK food, drink and
grocery
• Insight Plus
– Insight Plus offers your business the
opportunity to engage in any of our
We use a range of research regular shopper research projects in
advance of publication, tailoring the
methodologies to discover genuine scope to suit your needs
insights. Our research incorporates
a broad spectrum of robust • Bespoke Consulting
qualitative and quantitative
research techniques. – As publishers of research, we are able
to draw upon a wealth of existing
proprietary data for consulting projects
As a leading publisher of shopper – helping to better inform and shape
research, we are ideally placed to any further research requirements.
offer your business actionable
shopper insight.
Further information is available at our
website http://www.evolution-
insights.com
Visit and sign up for Reflections, our free
quarterly newsletter offering analysis and
commentary on topical issues
www.evolution-insights.com 2

3. Contents
Figures and graphs 5 Problems with Subscribe & Save 40
Bulk Buying 41
Key findings and executive summary 7 Willingness to buy in bulk in store and online 42
What this report will do for you 8 Bulk Buying Online 45
Research conducted on Amazon.co.uk Grocery 12 Summary 46
Non-standard Grocery Channels: Introduction 13 Amazon.co.uk: Category Level Analysis 47
Consumer Confidence 14 Introduction 48
Income and Attitudes 15 Category Penetration 49
Channels 16 Subcategories 50
Subcategories Breakdown 51
Amazon.co.uk: Introduction 17 Sold by Amazon 54
Amazon.co.uk 18 International, Organic & Speciality Food 56
Timeline of major launches 19 Home Care & Cleaning 57
Amazon Marketplace 20 Beer, Wine & Spirits 58
Fulfilment by Amazon 21 Top 100 59
Delivery 22 Summary 61
Amazon Lockers 25
Pre-ordering and Product Availability Alerts 26 Amazon.co.uk: Test Shops 62
1-Click 27 Introduction 63
Amazon Prime 28 Shop 1 64
Amazon Accounts 29 Shop 2 65
Shopping via smartphones and tablets 30 Shop 3 66
Popularity of Features 31 Summary Table 67
Summary 68
Amazon.co.uk: Groceries 32
Introduction 33 Other Non-Standard Grocery Channel Propositions 69
Awareness and Usage 34 Introduction 70
Amazon Shoppers’ Behaviour 36 Shorters Club 71
Brands 37 Shorters Club Test Shop 72
Subscribe & Save 38 Costco 73
Uptake of Subscribe & Save 39 Macro 74
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4. Contents
Approved Food and Food Bargains 75
Viking 76
Staples 77
Summary 78
Methodology 79
Glossary 83
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5. Figures and graphs
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6. Figures and graphs
Page Type Title
14 Graph Consumer Confidence
15 Graph Average UK Household Income Tracker
15 Graph Current Food & Grocery Spend Attitudes
18 Graph Top 20 Brands first half 2012: UK (Based on Index). YouGov.
19 Figure Timeline of major launches
23 Figure Delivery opinions
29 Graph Amazon Accounts
31 Figure Popularity of Features
34 Graph Awareness and Usage
35 Graph Awareness and Usage (2)
36 Figure Amazon Shoppers’ Behaviours
37 Figure Brands
39 Figure Uptake of Subscribe & Save
42 Graph Willingness to buy in bulk in store and online by category
43 Graph Willingness to buy in bulk in store and online by category (2)
44 Graph Willingness to buy in bulk in store and online by category (3)
45 Graph I am likely to buy more items in bulk online than in store due to ease of transportation
49 Graph Category Penetration
51 Table Subcategory Breakdown
52 Table Subcategory Breakdown(2)
53 Table Subcategory Breakdown (3)
54 Figure Sold by Amazon
55 Figure Sold by Amazon by category
59 Figure Top 100
60 Figure Top 100 (2)
64 Figure Shop 1
65 Figure Shop 2
66 Figure Shop 3
67 Table Summary Table
72 Figure Shorters Club Test Shop
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7. Key findings and executive summary – What this report will do for you
This report will:
Provide you with a brief background to Amazon.co.uk.
Give a detailed outline of Amazon’s current features and
how useful shoppers find these.
Summarise Amazon’s Grocery proposition, including
awareness and usage as well as what shoppers use Amazon
Groceries for.
Consider Amazon Groceries offering at a category level. This
includes a category breakdown of penetration as well as
what items are actually sold by Amazon rather than third
party sellers.
Look at the uptake and barriers to Subscribe & Save.
Highlight issues found from first hand tests of Amazon
Groceries.
Outline some of the other non-standard grocery channels
propositions available to shoppers.
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8. Research conducted on Amazon.co.uk Grocery
Dates are given for when research was
conducted on Amazon.co.uk Grocery as the
number of items listed on Amazon changes
constantly. As such, our figures are given as a
snapshot of Amazon on the date given. We
assume that these are a fair general
representation of Amazon.co.uk Grocery.
This also applies for the most popular items
bought by shoppers on the given dates. We
believe that what we observed from the site at
these times are examples of average shopping
behaviour on Amazon.co.uk/grocery.
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9. Amazon.co.uk: Introduction – Timeline of major launches
1998 1999 2000 2001 2002 2003 2004 2007 2008 2009 2010 2011
Amazon.co.uk DVD/Video Store Marketplace DVD Rental Health and Beauty Musical
launched opened launched Service Store launched Instruments and
Electronics and launched DJ Store launched
Music Store
opened Photo Store Home and Sports and Leisure Office Supplies Amazon App for
opened Garden Store Store opened Store opened Android launched
opened DIY and Tools
Software and Grocery Store
Store launched
Video Games launched Checkout by
Jewellery and Lighting Store
Store opened Amazon launched
Watches Store opened
Toys and Games Kindle Store
opened
Store opened Clothing Store launched
launched Outlet Store All-New Kindle
Amazon Prime
launched opened launched
Print on demand Pet Supplies Store
for books launched
Shoe and
Baby Store launched Handbag Store Amazon Lockers
opened opened Amazon launched
MP3 Store Windowshop
launched Car and for iPad
Shoes Store Motorbike Store launched
opened opened
Kindle available in UK
Amazon.co.uk Shopping
App for iPhone and iPod
touch launched
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10. Amazon.co.uk: Introduction – Delivery
Amazon offers several Evening Delivery – £14.99
different delivery options Express Delivery – £8.99 per
per delivery. £7.48 per unit delivery. £4.49 per unit for
for items sold specifically for Amazon Prime members. Amazon Prime members.
by Amazon. These may Orders before the Evening Orders before the Express
not apply to third party deadline are guaranteed to deadline guaranteed to
sellers on Marketplace, arrive on the same day. arrive by 1pm the following
Delivered 18:30-21:30
unless they are “Fulfilled day. Offered on almost all
weekdays and 14:30-17:30 at deliveries to mainland UK
by Amazon”. the weekend. Only available addresses.
within certain postcodes.
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11. Amazon.co.uk: Introduction – 1-Click
1-Click offers a fast and easy way for shoppers to order
from Amazon.co.uk. 1-Click is automatically enabled
after a shopper has placed their first order through
Amazon.co.uk. After this order, a “Buy it now with 1-
Click” button will be on the right-hand side of any Product
Detail page for items listed by Amazon and Amazon Pro
third party sellers. This will check the order out and
dispatch it to the default address, gathered from the
previous order.
A 1-Click order can be changed or cancelled within 30
minutes of placing it.
FREE Super Saver Delivery is not available for 1-Click
orders.
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12. Amazon.co.uk: Introduction – Amazon Accounts
‘What kind of Amazon account do you have?’
80
16
4
Standard Unsure Prime
The majority of Amazon shoppers have a standard account. Just 4% have an Amazon Prime
account. Shoppers may feel that the charge is too high or that they just won’t use their account
enough to take full advantage of the Prime benefits.
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13. Amazon.co.uk: Category Level Analysis – Sold by Amazon
18%
82%
Only 18%* of all food and grocery items on Amazon.co.uk Grocery are actually sold by Amazon.
This means that shoppers only benefit from Amazon postage deals or Amazon Prime membership
on less than one in five of all available food and grocery items. Including those third party food
and grocery items which are fulfilled by Amazon, only 20%* of all items listed on Amazon.co.uk
Grocery are eligible for FREE Super Saver Delivery.
Some shoppers are aware of these differences between sellers, with 36% of Amazon food and
grocery shoppers only buying directly from Amazon and avoiding third party sellers.
*data gathered on 12.07.12
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14. Amazon.co.uk: Test Shops – Shop 1
Shop One
No. of items 23 items
Missing basic items such as milk and butter. No standard milk just Time 18:02:70
UHT milk, evaporated, condensed and milk portions. Specialist
butters available, such as Hazelnut, Ghee and Raw Cashew Butter
rather than standard butter. Cost £99.37
Postage £81.62
Brand repertoire is limited so alternative brands were chosen for
Total £180.99
most items.
(% Postage +82%)
Can only buy certain items in bulk, such as a pack of 8 Dolmio
Meatball Bolognese Sauce rather than just one.
Having to buy from several different sellers resulted in some
extreme high delivery prices, for example £9.02 delivery on £1.42
bag of German Mamma Lucia Cannelloni Pasta, 250g.
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15. Methodology
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16. Methodology
Evolution’s methodology
• Evolution carried out a preliminary survey of
around 100 shoppers to test questions for the
main survey.
Secondary and Preliminary • Detailed secondary and desk research is
desk research quantitative survey conducted to define the topic area, macro drivers
and trends, scope and examples within the
research topic.
• Initial insights gained are used to help further
design the main survey.
Main quantitative • A main survey is completed by at least 1,000 UK
Test Shops adults who are the primary household shopper for
survey
food & grocery.
• Test shops were carried out to gain first hand
experience of Amazon.co.uk/grocery
• Comprehensive and detailed assessment of all the
data received was then used to uncover insights.
Insights • Throughout this process, primary research was
supported by secondary research drawing on
Evolution’s proprietary databases, national
statistics, news and industry resources.
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17. Methodology: quantitative research - survey
Topics of questions in quantitative survey
Demographic profiling • Detailed shopper insights were
gained from a survey of 1,027
primary shoppers. The samples
Usefulness of Amazon’s features were fully representative of the UK
population.
Opinions about deliveries • The survey contained 10 questions
relating to topics outlined to the
left – in addition to standard
Awareness and usage of amazon for non-food and grocery items demographic profiling questions
• The questions were designed to
Awareness and usage of amazon for food and grocery items give maximum insight into
shopper’s motivation and
behaviour
Barriers to Amazon Groceries
• The survey was carried out during
the week commencing 6th August
Category penetration 2012.
Shopping behaviours on Amazon Groceries
Awareness and usage of Subscribe & Save
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18. Methodology: Test Shops
To see just how practical Amazon Groceries is
for food and grocery shopping and to gain
primary experience of how it operates test
shops were conducted upon the site. Shopping
lists were taken from The Grocer 33, a list of 33
everyday food and grocery items. The price
and quantity of items were recorded along with
postage charges for those items sold by third
party sellers. Unavailable items were also
noted along with the time it took to complete
the online grocery. Three separate shops were
conducted by an non-online shopper allowing
for averages to be calculated. Any other
problems or comments are also given. All tests
were conducted in the week commencing
23.07.12.

19. Contact us
Evolution Insights Ltd
Prospect House
32 Sovereign Street
Leeds
LS1 4BJ
Telephone: 0113 336 6000
e-mail: insights@evolution-insights.com
Web: http://www.evolution-insights.com
Company No. 07006001
Country of Incorporation: United Kingdom
© Evolution Insights Ltd. All rights reserved 19