Total e-commerce grocery sales passed $9 billion for the month of January, seeing nearly 70 million U.S. households place on average 2.8 orders online during the month.
The results are part of Brick Meets Click and Mercatus Grocery and their rolling shopper survey on e-commerce. The surveys have been showing tremendous sales growth in e-commerce grocery since the pandemic began.
The latest findings, a survey of 1,776 U.S. adults fielded between Jan. 28-31, showed online grocery reached $9.3 billion in sales, with 77% of that going to delivery and pick-up for a total of $7.1 billion.
Total sales grew 15% in January 2021 vs. November 2020, driven largely by a 16% increase in the number of households buying online, the study said. Among the total household monthly active users, 78% engaged with either a delivery or pick-up service — up from 64% in November. The ship-to-home usage rate dropped from 56% to 46% during the same period. By comparison to other booming months, January’s overall usage rate fell short of the record 76.7 million households who shopped online in April 2020.
The report also said the average order value decreased nearly 11% in January 2021 versus November 2020 when analyzing the aggregated spend rates across all three segments (pick-up, delivery, and ship-to-home).
“Even though many grocers remain capacity constrained — especially with pick-up — others are growing market share as they staff up or expand pick-up to a larger store base,” said David Bishop, partner, Brick Meets Click, Barrington, Ill. “While throwing more labor at the issue isn’t ideal, this, along with improving assembling productivities via enhanced pick and pack practices, is vital to remaining competitive in the near term and not inadvertently giving your customer a reason to shop elsewhere.”
The study also found that compared with November levels, the share of first-time customers climbed 3%. Additionally, retail conditions are causing a decrease in satisfaction levels among even the more experienced customer cohort; intent-to-repeat for this group dropped by almost 18 points in January compared to November, the study said. Brick Meets Click defines first-time customers as shoppers that place their first order with a specific service within the last three months, and “experienced” customers as those who made at least four orders with a service over the last three months.
“It’s clear from the data that retailers will face a challenge in holding on to a lot of online shoppers as experience is not meeting expectations,” said Sylvain Perrier, president and CEO, Mercatus. “To remain competitive with mass merchandisers, regional grocers need to enhance the digital shopping experience so as not to give their customers a reason to spend their money elsewhere. Grocers have to look at where they can improve operationally, how they can efficiently scale to meet online demand, and which services will be most effective at revenue protection going forward.”
A more extensive summary of the January 2021 research insights is available from Brick Meets Click via subscription to the eGrocery Insights Program.