Industry Partners

Online Grocery Sales Total $8.1 Billion in October as Buying Patterns Stabilize

Pickup continues its reign; mass retailers win on intent to shop again
Online grocery sales October 2021
Image courtesy of Brick Meets Click and Mercatus

U.S. online grocery sales totaled $8.1 billion in Octoberabout flat with September—as the share of households making at least one grocery purchase online held steady at about 50%, Brick Meets Click and Mercatus reported Thursday.

Brick Meets Click's monthly survey, sponsored by Mercatus, found that pickup/delivery from stores again reigned as the preferred method for receiving orders, though by a slightly smaller margin than in September: Pickup/delivery rang up $6.4 billion in sales in October (vs. $6.7 billion in September) and ship-to-home tallied $1.7 billion. 

The weighted average order value stood at $70.65 in October, with a breakdown of $85.13 for the average delivery order, $80.88 for pickup orders and $45.57 for ship-to-home. Average order values for all segments were down from their 2020 highs, but pickup and delivery order values in the month were 12% and 18% higher, respectively, than in August 2019.

"As the number of new COVID-19 cases in October continued to decline, key performance indicators (KPIs) for monthly active users, order frequency, and average order value are rebalancing from the record highs of 2020 and now provide a more stable and sizable base for building and forecasting the business in 2022 and beyond," Brick Meets Click partner David Bishop said in a news release.

For the month, 63.8 million U.S. households ordered groceries online; most of these preferred to use one method only—pickup, delivery or ship-to-home—for getting their online orders. Pickup had the largest monthly active user base, at 33.4 million households; delivery had the smallest, at 26.2 million households. Ship-to-home saw 29.8 million active user households in October, but that number has shrunk each month since July, Brick Meets Click and Mercatus noted. In addition, a growing share of households, now more than 30%, are selecting multiple methods for receiving their orders. 

What does this mean for grocery retailers? Choice rules, as consumers have different shopping needs and preferences day to day and week to week that may prompt them to seek out varying channels for getting their orders over the course of the month. 

"A sound strategy for grocers going forward is continued investment to improve and differentiate your online service," Mercatus President and CEO Sylvain Perrier said in the release. "Incentivize customers to shop your first-party channel while offering them choices for receiving online orders."

In October, the share of customers who said they intended to buy online again from traditional grocery stores lagged the share who said they'd buy online from mass retailers such as Walmart and Target again by 2.1 percentage points. "This gap, while smaller than in September, signals that grocery retailers continue to have an opportunity to boost satisfaction by reducing sources of friction in their service," the survey partners stated.

 

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