eGrocery Benchmarks Part 3: Top-Quartile Grocery Stores Generate Weekly Online Sales 6x Higher

Top Line

Conventional grocery stores in the top-performing quartile generated average weekly online grocery sales of $43,895, 6.3 times higher than the median sales of $6,934 for rest of the stores, according to the Brick Meets Click eGrocery Performance Benchmarking 2021 Wave . A dramatically higher average order value (AOV) was one factor that influenced the strong performance of these top-quartile stores.

“Grocers are well aware that many variables affect performance across their base of stores, but they need to occasionally challenge or retest assumptions about growth drivers as selling online evolves and matures,” said David Bishop,Partner at Brick Meets Click. “This quartile analysis reinforced that excelling at selling online – like operating a physical store – requires both a sound strategy and effective execution.”

Sponsored by Mercatus , Hussmann , and  Cardlytics , the research analyzed transactional sales data linked to non-personally identified households of nearly 950 stores from 45 U.S. banners and is the largest independently conducted grocery benchmarking initiative completed to date.

Customer Metric Insights: Part 3*

The top-quartile analysis findings revealed insights into how order value, location, age, and range of services contribute to the significant performance gap between the top-performing stores and the others.

Larger orders: The AOV at the top stores was46% higher, as customers spent nearly $126 per order, compared to $86 at the lower-quartile stores.

The availability of alcohol, whether beer only, beer and wine, or beer,wine, and liquor, likely played a role in the higher AOVs, as 90% of the top-quartile stores sold alcohol online while only 60% of the others did.

Store Location: Where a store is located is not as significant a factor as some may believe.

Analyzing per-store performance within the top quartile based on trade area population generally revealed an inverse relationship between population size and sales performance. In other words, top-quartile stores operating in zip codes with a population under 10,000 reported 31% higher weekly sales than stores in areas with a population over 40,000. In contrast, sales at stores in the lower quartiles increased as the size of the population did.

Age of Service: Top-quartile stores have matured much better than the rest.

Top-quartile stores had operated online longer as 50% have done so for four or more years as compared to 34% of the others. Only 10% of the top-quartile stores had operated for less than one year versus 25% of all other stores.

Range of Service: Offering multiple ways to receive an online order mattered the most.

Top-quartile stores were 1.5 times more likely to offer both Pickup and Delivery services. In fact, 67% of the top-quartile group offered both services, while only44% of the others did.

Top-quartile stores that offered both Pickup and Delivery generated weekly sales that were 39% higher than top-quartile stores that only offered one service.

Sponsor Appreciation & Message

We thank the teams at Mercatus , Cardlytics , Hussmann for their generous support of this important research.

“It’s helpful for grocery retailers to consider what factors may be preventing their online grocery business from performing at the same level as the top quartile,” said Sylvain Perrier, president and CEO, Mercatus. “The same factors that go to making one location successful in terms of online sales will not necessarily translate to all locations. The best performers likely have ironed out their operational wrinkles, resulting in the best possible fulfillment experience for customers.Meanwhile, the level of marketing investment directed to promoting online service options also will have an impact over time.”

*eGrocery Performance Benchmark Reports

The complete results of the Brick Meets Click eGrocery Performance Benchmarking 2021 Wave is being released in a series of three reports:

1. Top-line Performance Findings (released late January) focuses on key causal factors that can impact top-line performance, such as how long a service hasoperated,what services are offered by each store, and where the store operates.These findings were discussed in the Feb. 3 webinar featuring Dan Sullentrup of Hussmann . Click here to watch now .
2. Key Customer Metrics (released late February) explores key eGrocery metrics, ranging from attracting new customers to growing sales from existing ones, supported by additional perspective from Cardlytics .Findings will be discussed a public webinar, featuring David Bishop of Brick Meets Click and Andrew Van Aken of Cardlytics.  Click here to watch now .
3. Top-Quartile Analysis releases in late May, and will highlight factors and issues that can show grocers how they can further improve performance with practical guidance from Mercatus .

About this research

The Brick Meets Click eGrocery Performance Benchmarking is an annual initiative based on ePOS data provided by participating retailers. It began in 2016 with 17 grocery store banners and has grown to 45 banners for 2021.

The 2021 wave generated key insights based on an analysis of comparable 12-week periods during 2021 and2020, examining performance across three 4-week periods (8, 9 and 10) ending with September 28, 2021.

The study examines the critical business questions related to improving strategy and execution when operating a first-party ecommerce shopping service.