As consumers look for lower-priced grocery options amid ongoing budgetary pressures, Flashfood is seeing its eCommerce marketplace, which sells food that would otherwise go to waste at discounted prices, boost grocers’ sales.
In an interview with PYMNTS, Nicholas Bertram, who was announced as CEO of the company Wednesday (Jan. 17), explained that the app, which partners with grocers to offer deals on products nearing their expiration dates, drives overall traffic and sales for grocers.
“Through surveys, we know factually that the majority of people who come in to pick up their Flashfood order are also walking into the store and picking something else up,” Bertram said. “That’s why we strategically positioned the Flashfood zone past the point of purchase. … Most of the shoppers, I think, usually go and pick up the other things that they want, and then pick up their Flashfood order on the way out.”
Consumers are looking for deals on their groceries. The PYMNTS Intelligence report “Consumer Inflation Sentiment Report: Consumers Cut Back by Trading Down,” which was based on a study of more than 2,000 U.S. consumers, found that 57% have cut down on nonessential grocery purchasing amid inflation. Plus, 47% have switched to merchants with lower prices for at least one grocery product, and one-third have traded down from their favorite grocery brands to less expensive alternatives.
Bertram said more people are using the app for the deals it offers than for the ethical reasons, such as looking to reduce food waste.
“Less than 10% of our users in surveys chose Flashfood because of the impact on the planet, …which is fine,” Bertram said. “Consumers make their choices. They chose us because we save them money.”
Bertram added that the “excitement” of seeing what the deals are on a day-to-day basis also drives usage, with a select group of “power users” returning to the app daily to be the first to get good deals.
Consumers, for their part, are becoming increasingly comfortable using apps and other digital platforms to buy groceries. The PYMNTS Intelligence report “Consumer Interest in an Everyday App” revealed that 61% of those who had shopped for groceries in the previous month did so via connected devices at least some of the time.
Plus, the new PYMNTS Intelligence report “The Online Features Driving Consumers to Shop With Brands, Retailers or Marketplaces,” which drew from a survey of more than 3,500 U.S. consumers, found that 77% are very or extremely satisfied with their experiences buying groceries on online marketplaces.
Looking at the year ahead, Bertram said he envisions rapid growth in both the app’s user base and its retailer partnerships. The company could expand internationally beyond North America. He said now that the app can prove its benefits for grocers, the company has an easier time finding partners.
“What retailers really want more than anything else is traffic,” Bertram said. “And once we had the data to really prove our hypothesis that we were bringing incremental traffic, and we were actually statistically increasing the loyalty of the shoppers, that changed [things] big time.”