Apr 2022 U.S. Online Grocery: Sales total $8.1 billion, down nearly 4% vs last year

Top Line

April online grocery sales pulled back 3.8% versus last year, finishing at $8.1 billion,as total order volume dropped 5.8% driven by lower order frequency and a slightly smaller monthly active user (MAU) base, according to the Brick MeetsClick/Mercatus Grocery Shopping Survey fielded April 28-29,2022. The evidence suggests that customers are more likely to be concerned about the impacts of inflation than contractingCOVID-19.

"It’s no surprise that inflation is affecting where and how people shop online for groceries," said David Bishop, partner at Brick Meets Click. "Some customers may now find Pickup a more attractive service since it can help them avoid the higher incremental costs associated with Delivery, and others may choose to simply move more of their transactions back into the store."

Key Findings & Insights

Evidence suggests that today’s eGrocery customers are more likely to be concerned about the impacts of inflation than contracting COVID-19.

Analyzing responses from March and April 2022 related to an MAU’s most recent online order found that Mass customers were 34% more likely than Grocery customers to indicate that cost (i.e.,not paying more than necessary) was the most important factor in deciding whereto buy groceries online.

When it came to how online grocery orders were received, Pickup customers who used Grocery or Mass were respectively 18% and 11%more likely to cite cost as the primary consideration when compared to Delivery customers.

Sales in all three segments declined but Delivery drove almost half of the month’s contraction.

Delivery-related sales, which accounted for almost one-third of total online grocery sales during April, dropped nearly 6% versus a year ago and contributed nearly half of the decline in total sales year-over-year.

• The segment’s average order value (AOV) jumped 6% to $84 versus April2021, helping to mitigate an 11% decline in order volume.
• The order volume decline was mainly driven by an MAU base that contracted nearly 9% over the past year.

Ship-to-Home,the smallest segment with just over one-fifth of the sales in April, fell over 3%versus last year.

• Order volume drove the decline, dropping nearly 6% versus April 2021, while the AOV increased by almost 3% to $47.
• The decline in order volume was the result of a contraction in the MAU base of more than 2% as well as MAUs receiving 4% fewer Ship-to-Home orders during the month.

Pickup,the largest eGrocery segment with almost half of total sales, declined by less than 3% versus the prior year.

• Unlike the other two segments, Pickup reported a nominal drop in AOV of approximately 70 basis points to $81; this, combined witha 2% drop in order volume, contributed to the year-over-year decline in sales.
• Versus April 2021, Pickup’s MAU base shrank by less than 3% and order frequency among its MAUs was essentially unchanged.

Cross-shopping between grocery and mass gained momentum.

Despite the year-over-year drops in both order volume and the MAU base, the share of Grocery’s MAU base that also shopped online with Mass during the month increased just over 40 basis points versus last year, finishing at 24.2% for April 2022.

Repeat intent: Overall level higher vs year ago & Mass regains top spot

The likelihood for an online grocery shopper to use the same service again within the next month also increased during April, climbing to 68%, up 8 percentage points on a year-over-year basis.

• Analyzing month-over-month results showed that repeat intent rates at Mass providers slid 3 points in April, while Grocery’s intent rates climbed more than 50 basis  points.

Share of wallet down slightly vs. last year

In terms of share of wallet, total eGrocery finished April at 12.3%, down slightly from last year’s 12.7%. When excluding Ship-to-Home (since most conventional grocers don’t offer this service) the combined Delivery and Pickup segments finished the month at 9.6%, down about 30 basis points versus 2021.

Sponsor Message & Appreciation

“With budget conscious consumers naturally gravitating towards lower cost online services like Pickup, grocers need to find ways to offer these services profitably and remain competitive,” said Sylvain Perrier, president and CEO, Mercatus.“Conventional grocers can take advantage of more efficient pick and pack practices. They can also use tiered pricing models and variable fee structures to offset the cost to serve while still providing a compelling Pickup experience to customers.”

We thank the team at Mercatus for their continued generous support of this research. Click here to see the May 9, 2022 press release.

About this Consumer Research

The Brick Meets Click/Mercatus Grocery Shopping Survey is an ongoing independent research initiative created and conducted by Brick Meets Click and sponsored by Mercatus.

Brick Meets Click conducted the survey on April 28-29, 2022,with 1,746 adults, 18 years and older, who participated in the household’s grocery shopping. This research is scheduled to run monthly through 2022; then the cadence will be reevaluated to best suit the industry’s needs.The three receiving methods for online grocery orders are defined as follows:

• Ship-to-Home includes orders that are received via common or contract carriers like FedEx, UPS, USPS, etc.
• Delivery includes orders received from a first- or third-party provider like Instacart, Shipt or the retailer's own employees.
• Pickup (aka curbside) includes orders that are received by customers either inside or outside a store or at a designated location/locker.

Results were adjusted based on internet usage among U.S. adults to account for the non-response bias associated with online surveys. Responses are geographically representative of the U.S. and weighted by age to reflect the national population of adults, 18 years and older, according to the U.S. Census Bureau.

Brick Meets Click used a similar methodology for each of the surveys conducted in 2022 - Mar. 28-29 (n= 1,681), Feb. 26-27 (n=1,790),and Jan. 29-30 (n=1,793); in 2021 – Dec. 29-30 (n = 1,836), Nov. 29-30 (n=1,785), Oct. 29-30 (n=1,751), Sept. 28-29 (n=1,728), Aug. 29-30 (n=1,806), July 29-30 (n=1,892), June 27-28 (n=1,789), May 28-30 (n=1,872), Apr. 26-28 (n=1,941), Mar. 26-28 (n=1,811), Feb. 26-28 (n= 1,812), and Jan. 28-31 (n=1,776); in 2020 – Nov. 11-14 (n=2,067), Aug. 24-26 (n=1,817), Jun. 24-25 (n=1,781), May 20-22 (n=1,724), Apr. 22-24 (n= 1,651), and Mar. 23-25 (n=1,601); and in 2019 – Aug. 22-24 (n = 2,485).