Back in 1975, the company says, Woodman’s Food Markets became the first grocer in Wisconsin to use barcode scanners in its stores.  More than 40 years later, the employee-owned grocer is embracing the idea of selling food online.

Woodman’s launched an updated mobile app in February that customers can now use to order their groceries from a smartphone or tablet. Woodman’s, which has an online store at ShopWoodmans.com, offers online ordering for pickup and delivery at eight of its 16 locations. By the end of 2017, the grocer plans to make online ordering available chainwide.

The updated app was created by  vendor GrocerKey Inc., which provides retailer-branded e-commerce grocery technology to mid- to large-sized retail chains. Woodman’s hired GrocerKey in 2015 to set up, manage, and operate ShopWoodmans.com. Woodman’s licensed GrocerKey e-commerce technology and mobile apps as part of the deal. Woodman’s also contracted GrocerKey to hire and manage the staff necessary to operate the e-commerce operation, including picking and packing orders.

A previous Woodman’s app was aimed mostly at making in-store shopping easier, and the new app is designed to do that as well. In addition to online ordering, the app allows shoppers to create shopping lists, organize them by the fastest path through the store and get an estimated dollar total before they start shopping. An in-store search feature helps shoppers to locate products, and all product listings include product ingredients and nutritional information.

As of the end of June, about 15,000 consumers had downloaded the updated app.

Clint Woodman, president,
Woodman’s Food Markets

Clint Woodman, president of Woodman’s, says online sales represent 2% to 3% of overall sales at the stores that offer it. He says the average e-commerce order volume of $140 to $150—is roughly three to five times the average of $30 to $50 in its stores. Online ordering for pickup is free on orders of $100 or more and $4.95 for orders below that amount. Delivery costs $9.95 with a $50 minimum order.

Woodman says he thinks convenience of shopping on the web is what leads to the higher order volumes the grocer sees in the online orders.

“I believe the shopping experience is probably more enjoyable as they’re doing it from a more comfortable environment on their own time, so, inevitably they have more time to think about what they need,” Woodman says. “Their shopping list is available to them on their phone or computer to access whenever they think of something that they want to add. Furthermore, someone else is doing the heavy lifting, putting in the work, picking, packing, delivering so why not keep adding to the list/order?”

GrocerKey CEO Jeremy Neren says adding online ordering to the mobile app made sense because ShopWoodmans.com has seen a steady increase in mobile users since the site was launched. Mobile traffic, he says, now represents just over 50% of website visits.

Woodman says the grocer is beginning to roll out digital coupons on its app. Woodman’s also plans to step up its e-mail marketing and, possibly add push notifications, which are messages that appear on the screen of customers’ mobile phones.

Orders for pickup and delivery are packaged at Woodman’s supermarkets, and there are no plans to change that, Woodman said.  There is ample room at Woodman’s stores, which are as big as 250,000 square feet. By comparison, the Food Marketing Institute says that the median supermarket in 2015 had 42,800 square feet of space. Woodman says the stores offering online shopping devote 500 to 1,000 square feet to e-commerce “staging areas” at the front of its stores, where consumers pick up their orders.

Neren says GrocerKey completed 18,000 Woodman’s orders in 2016, and the number continues to grow. In June alone, he says, they handled about 5,000 orders at the six locations that were taking online orders at that point. Neren and Woodman say the online store started turning a profit less than a year after it launched.

“In many cases e-grocery orders are stock-up trips,” Neren says “Given Woodman’s large assortment, this is the most common use for ordering from ShopWoodmans.com. The average ShopWoodmans.com order has 55 items in it, so customers are typically buying everything they need for a week.”

Another way Woodman’s stays current is by maintaining a robust social media presence. Every Woodman’s location has its own Facebook page and Twitter feed. Woodman’s also maintains an archive of its folksy television commercials on YouTube and shares recipe ideas on Pinterest. Woodman says the company also invests in Facebook ads.