Understanding Customer Preferences of Delivery Services for Online Grocery Retailing in South Korea

Abstract

With the rapid growth of online grocery shopping in South Korea, e-grocery retailers have faced intense competition. Consequently, they attempt to differentiate themselves by offering diversified delivery services, such as providing early morning delivery services or eco-friendly packaging. The purpose of this paper is to analyze consumer preferences with regards to delivery services with different delivery times and packaging types targeting South Korea’s online grocery markets. Specifically, six delivery types consisting of combinations of two delivery time options (dawn, daytime) and three packaging types (paper box, market cooler bag, personal icebox) are examined. A survey was conducted in July 2020 with 218 consumers who regularly buy fresh food online. The collected data were analyzed by means of a conjoint analysis and ANOVA. The present study finds that customers most strongly prefer dawn delivery using a personal icebox, followed by dawn delivery using a market cooler bag, with daytime delivery using a paper box being the least preferable. Furthermore, consumers value the packaging type more than the delivery time when selecting a delivery service. Lastly, the preferences of consumers regarding delivery service types differ according to their characteristics. This study is expected to contribute to the establishment of a delivery strategy for online grocery companies.