Amazon’s online grocery sales grow nearly 50 percent in first quarter

One Click Retail reports that U.S. grocery sales on Amazon.com grew by nearly 50 percent year-over-year in 2018’s first quarter — an increase of $200 million — to reach $650 million. Coffee remains Amazon's largest grocery category by far, according to the Salt Lake City-based e-commerce data measurement, sales analytics and search optimization firm.

Both coffee and Amazon’s cold beverage offerings grew by more than 40 percent and earned more than $140 million in the first quarter, according to One Click Retail. Amazon sells its own coffee and bottled water under the Happy Belly private brand.

Sylvain Perrier, president and CEO of Mercatus, a provider in digital solutions for grocery, says Amazon’s “overwhelming success in the grocery space” is a sign of just how important online grocery is becoming to shoppers.

“Following the purchase of Whole Foods Market and investments in various grocery initiatives including Amazon Go, Prime Now and Pantry, Amazon’s grocery success will continue to accelerate as they increase their capabilities with new grocery initiatives and expanded delivery areas,” Perrier said. “Consumers clearly are getting more comfortable with the idea of online grocery across a broader spectrum of categories. Case in point is Amazon’s reported 152 percent surge of milk and cream purchases — a perishable category that consumers have long been hesitant about buying online.”

Perrier said Amazon’s success should be a wake-up call to grocers who are not considering an investment in online grocery ordering, fulfillment and delivery.

“By failing to create a better digital shopping experience, retailers are missing out on the opportunity to meet customer expectations and build greater loyalty,” he added. “Additionally, as we see loyalty-driven Amazon Prime thrive from adoption in Amazon’s grocery initiatives, it’s essential that grocers understand the power of customer data collection and its ability to improve future offerings and customer experiences.”