Grocery Trends with Brick Meets Click – August 2022 Insights
US eGrocery sales for August 2022 totaled $8.5 billion, a less than 1% decrease from the same period last year. This insignificant dip follows a dramatic surge in eGrocery sales at the onset of the pandemic. Despite the small decrease, US eGrocery sales have remained at significantly elevated levels over the last four years. The Brick Meets Click/Mercatus Grocery Shopping Survey shows that this trend is likely to continue, with online grocery shopping becoming the preferred method for many American shoppers. This shift to online grocery shopping is being driven by convenience, savings, and a greater selection of products available online. As US eGrocery sales continue to grow, it is important for businesses to adapt their strategies to meet the needs of this growing market.
The three segments that make up these transactions – Pickup, Delivery and Ship-to Home – have each grown pre COVID. But the lion’s share of total revenue has migrated away from ship to home with delivery consistently increasing year over year. Pickup also grew slightly more this last August versus last years’ numbers however ceding some small margin too.
In August, over 68 million households went online to buy at least one grocery order via Delivery, Pickup, or Ship-to-Home. Although the total base of monthly active users (MAUs) for August 2022 is down by just over 1% versus 2021, it’s still up 23% from 2020 and 116% compared to 2019.
The share of MAUs engaged with Ship-to-Home dropped from 58% in 2019 to 44% in 2022. Over the same time period, Delivery’s share of MAUs climbed from 25% to 44%, and Pickup expanded from 32% to 54%.
The rate of order frequency among MAUs also shows that online grocery shopping has become a more frequent occurrence in shoppers’ lives, although the year-over-year trends since pre-COVID are slightly different. Between August 2019 and August 2020, the average number of orders received by a MAU jumped by 40%, from 2.0 to 2.8; since then, it has gradually declined to 2.7 in August 2021 and 2.6 in August 2022.
The report shows that while grocery spending has increased over the past year, it’s mainly due to where people are shopping and not just how much they’re ordering. In August of 2022 customers spent an average $200 per week on food which is 14% more than what was reported last twelve months — despite factoring out any inflationary pressures caused by higher prices at certain stores or brands.
In the month of August, both the Mass and Dollar formats reported larger user bases. Mass saw the biggest gain, with a 7% increase in MAUs, bringing their total up to 45% of the overall US eGrocery market. This is up from their 42% share in August 2021. Dollar also saw significant growth, with their MAU base increasing by over 70%. However, their share of the US eGrocery market is still significantly smaller than Mass, at only 15%. Grocery was the only format to see relatively flat growth, with their MAU base only increasing by 1%. However, they still hold a sizeable share of the US eGrocery market, at 40%.
The average order value (AOV) for Delivery and Pickup orders increased by 10% year-over-year to $87 during August. Ship-to-Home orders saw a much bigger decrease in AOV, with a 20% decline to $40 during the same period.
The report found that 63% of online grocery shoppers said they were likely to use the same service again within the next month. This is up three points from last year, but still below the levels seen in 2020 and 2019. Finally, the report also noted that grocery sales continued to lag behind those of other sectors, such as mass retail, on this metric. However, the overall trend for grocery sales remains positive, with a steady increase over the past few years.
For grocers that want to learn more comprehensive insights about how to lower the costs of fulfillment and improve eGrocery revenue, we encourage you to explore our latest Omnichannel Shopper Behavior Research, Volume 2: Why convenience and costs are driving more customers to pickup.