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05/09/2022

E-Commerce Share of Grocery Market Wanes in April

Brick Meets Click/Mercatus survey reveals lower digital sales and volume for the month
Lynn Petrak
Senior Editor
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E-Commerce Share of Grocery Market Wanes in April
Source: Brick Meets Click/Mercatus Grocery Shopping Survey fielded April 28-29, 2022.

Driven by higher costs and the resumption of everyday activities, consumers seem to be marching back to the store for in-person grocery shopping. According to the most recent Brick Meets Click/Mercatus Grocery Shopping Survey, online grocery sales declined 3.8% last month compared to April 2021 and online order volume slid 5.8% in the same time frame.

Also giving a glimpse into the omnichannel, the survey found that total e-grocery had a smaller share of wallet in April. E-grocery comprised 12.3% of grocery sales, down from 12.7% this time last year.

The Brick Meets Click/Mercatus research showed that sales were in negative territory across the e-commerce space. Delivery-related sales were down 6%, with that segment contributing nearly half of the year-over-year decline in total online grocery sales.

Sales in the ship-to-home part of the omnichannel – already the smallest slice of the e-comm market – fell more than 3% for the period, too. Orders sent directly to homes were lower as the monthly active user base narrowed.

Pickup, which has been performing steadily and well in recent times, also weakened, just under 3% for the month. The average order value for pickup showed a nominal drop of about 70 basis points to $81.

David Bishop, partner at the Barrington, Ill.-based Brick Meets Click, said that the ongoing volatility in pricing helped fuel the across-the-board declines in online grocery during April. “It’s no surprise that inflation is affecting where and how people shop online for groceries,” he remarked.

On that point of where consumers are shopping, the Brick Meets Click/Mercatus survey also found that people who buy products in the mass merchandising space are 34% more likely than shoppers who favor traditional grocery stores to cite cost as the most important factor in deciding where to buy groceries. Meanwhile, pickup customers who used grocery or mass were 18% and 11% respectively more likely to indicate that cost was their main consideration, compared to delivery customers.

As a result of higher prices, the scales within the omnichannel may be tipping a bit. Bishop believes. “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,” he said.

Sylvain Perrier, president and CEO at Mercatus, also weighed in on the impact of inflation heading to the midpoint of the calendar year. “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,” Perrier said. “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.”

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