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US eGrocery Market Share Report with Brick Meets Click – Insights From Q1 2024

New Market Share Report Underscores Importance of Increased Personalization for Grocers

A new quarterly Market Share Report from Brick Meets Click reveals several key insights for grocers aiming to compete with Mass Merchants — and win back their share of the eGrocery market.

In the first quarter of 2024, the Supermarket segment’s share of the eGrocery market fell below 30%. By analyzing the data and factors behind this decline, grocers can effectively strategize how to take on these major retailers and better retain their customers moving forward.

Our own analysis of the report’s findings emphasizes the crucial need for grocers to adopt advanced personalization strategies.

All of the key findings from the report suggest that modern consumers demand value and convenience, expecting a shopping experience tailored to their preferences. By leveraging first-party data and implementing personalized engagement and loyalty programs, grocers can provide these two drivers, enhance customer experiences, and increase retention rates.

If you’re a regional grocer looking for effective strategies for customer retention and winning back your market share from larger retailers, you need to read the complete eGrocery Market Share Q1 2024 report.

To get full access, sign up by clicking the link below. Once validated, you’ll receive the report free of charge as a valued Mercatus subscriber.

Download the Q1 2024 eGrocery Market Share Report

The 5 Most Important Takeaways From The Report

1. Competing with Walmart

Walmart’s eGrocery sales share surpassed Supermarkets in late 2022, and by the first quarter of this year, its share has grown to 37.4% vs. the Supermarket format’s share of 28.2%.

2. Pickup vs. Delivery

For customers of larger retailers and discount stores, Pickup is the preferred receiving method. Supermarket customers, on the other hand, lean more towards Delivery, which is the most expensive option to serve. However, Pickup orders in the Supermarket segment are growing significantly as more grocers introduce and expand Pickup services across their stores.

3. Rise of Cross-Shopping

The rate of regular Supermarket customers also shopping with a larger retailer is predominantly driven by Walmart, with cross-shopping numbers increasing or holding steady with all income groups except the highest over the last two years.

4. Repeat Intent Rate 

The likelihood of a Mass Merchant customer using their Pickup or Delivery service again increased over the first quarter of 2024, while it decreased for Supermarket shoppers. People who shop online with the big retailers are more likely to keep shopping with them than they are for supermarkets.

5. Impact of Inflation

Overall price inflation reached its highest point at the end of the second quarter of 2022, while Food-at-Home (FAH) inflation, which includes groceries and other items purchased for home consumption, peaked a bit later, in the third quarter of 2022. Since then, both have reduced significantly, but are still having an effect on the flight-to-value being taken by consumers.

To learn more about these and other takeaways, download the full report.

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Actionable Advice Based on the Data

1. Use personalization to better engage customers 

Walmart and other big retailers have captured a larger share of the eGrocery market by leveraging their pricing advantage to attract consumers impacted by current economic conditions. While competing on product prices may be challenging for grocers, they can capitalize on their own strength: a reputation for high-level, high-touch customer service.

The key is translating this traditional benefit into the digital realm.

By partnering with the right technology partner, regional grocers and independents can enhance their online customer experience, complementing the high-touch, in-store service they are known for. Just as big retailers have utilized their strengths to improve their market position, grocers must invest in their unique selling propositions to offer customers an unmatched experience.

This is exactly why we developed AisleOne’s end-to-end personalized engagement solution to empower grocers to activate, convert, and retain customers, resulting in increased monthly active users and higher average order value.

By leveraging first-party data and personalized digital offers, grocers can extend their traditional customer service advantage into the digital space and compete more effectively against larger retailers.

2. Utilize customer data to reduce operational costs

For many grocers, Delivery remains their most popular — and most expensive — fulfillment option. To better manage the costs associated with Delivery and find ways to promote less-expensive Pickup services, regionals and independents should use their customer data more effectively.

This means identifying 1) which customers prefer Pickup over Delivery and targeting them with personalized promotions that encourage the lower-cost option; and 2) which customer segments might be prompted to choose Pickup instead of Delivery with the right pricing strategy.

In the past, grocers had to deal with several disconnected data sources, multiple first- and third-party integrations, and loyalty programs that didn’t connect between online and in-store.

AisleOne’s Customer Data Platform consolidates your first-party data, allowing you to create a holistic view of the customer journey with automated tracking of each individual’s digital, transactional, and promotional activity data.

Through the platform’s Workbench Analytics, you can segment your customers, analyze their behaviors, and activate targeted campaigns based on those insights to deliver measurable results.

3. Leverage customer segmentation capabilities to fight cross-shopping 

The ability to use your first-party data to segment and target customers is also an effective tool in the battle against cross-shopping.

As the quarterly Market Share Report from Brick Meets Click reveals, cross-shopping is a serious challenge for grocers that’s increasing or stabilizing across all income groups except the highest.

This trend highlights the need for grocers to understand and cater to the specific behaviors of different customer segments. By using a platform that consolidates various data sources, grocers can gain a comprehensive view of the customer journey. This enables them to analyze specific behaviors and preferences, allowing for highly targeted and effective marketing campaigns.

AisleOne’s Customer Data Platform excels in this area, offering detailed data analysis and segmentation capabilities through the previously mentioned Workbench Analytics. Grocers can develop tailored campaigns that resonate with distinct customer segments, thereby retaining their customer base and minimizing cross-shopping with competitors.

4. Enhance customer loyalty with personalized offers timed to purchase cycles

Between the cross-shopping trend identified above and the fact that bigger retailers are seeing higher repeat intent rates than grocers, ensuring customer loyalty is more important than ever.

The static, unengaging loyalty programs of the past simply aren’t an effective way to retain customers anymore. Grocers have to find a way to build relationships with their customers beyond nominal discounts. That means providing both value through targeted savings and convenience with those savings being timed to when the customer really needs it.

AisleOne’s Loyalty Program Activation and eMarketing Automation leverage proprietary algorithms and machine learning to tailor content based on individual customer behaviors and purchasing patterns. This means grocers can automate programmatic targeting to ensure that offers, incentives, and recommendations are presented at the right moments in the customer’s purchasing cycle.

If a customer buys milk every seven days, chicken every 14 days, and laundry detergent every month, AisleOne will present savings opportunities aligned to these behaviors, providing a seamless shopping experience that makes the customer feel valued and heard.

This significantly enhances the likelihood of repeat purchases, creating greater customer loyalty and long-term engagement.

5. Provide targeted savings to meet value-driven consumer demands

The term “targeted savings” is an important one for both customers and retailers.

With inflation driving consumers to seek more value, grocers must respond by offering targeted savings that align with current economic conditions. This focus on value can help attract and retain cost-conscious shoppers.

However, trying to reach customers through broad-spectrum marketing is both costly and ineffective compared to targeted savings that are personalized to individual customers.

AisleOne’s advanced personalization capabilities enable grocers to build complex customer profiles and deploy strategic campaigns that consistently engage customers through email, SMS/text, mobile push, and integrated digital platforms. As a result, grocers can identify and effectively target value-driven customers with relevant digital coupons, loyalty points, and other cost-saving measures.

AisleOne helps grocers provide the right offers to the right customers, enhancing customer engagement and maintaining competitive edge even amid inflationary pressures. This approach not only meets the evolving expectations of today’s consumers but also drives profitable growth for the grocer.

Click below to learn how AisleOne can enhance your customer experience through personalized engagement and loyalty programs.

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Contextualized Commerce

The data revealed in the US eGrocery Market Share Report with Brick Meets Click can be interpreted in two ways. On one hand, it highlights the challenges that regional grocers and independents are currently facing in their competition with large retailers. On the other hand, it presents numerous opportunities for grocers to improve and reclaim their market share.

Having AisleOne at your disposal makes it significantly easier to have a positive perspective on the report. That’s because the majority of the data presented in it emphasizes the need for grocers to adopt the type of contextualized commerce strategies that AisleOne provides.

Contextualized commerce is the seamless integration of digital and physical retail experiences to provide personalized, high-touch service. It uses first-party data, operational insights, and advanced personalization techniques to engage shoppers from initial impression to transaction, both online and in-store, ensuring a connected and relevant experience across all channels.

By leveraging AisleOne’s capabilities, grocers can turn the insights from this quarterly report into actionable strategies that enhance customer engagement, reduce operational costs, and drive loyalty.

To fully understand the areas in which AisleOne can help win back your market share from the bigger retailers, download the complete eGrocery Market Share Q1 2024 report.

Click here for free access