Inflation-cautious U.S. consumers retreated to their grocery-shopping corners in April, new monthly data from Brick Meets Click and Mercatus suggests, as grocery delivery's active user base shrank and even online/in-store pickup, the powerhouse of online grocery sales, saw average order values and volumes dip.
Overall, online grocery sales in the U.S. were down 3.8% year over year in April to $8.1 billion, Barrington, Ill.-based Brick Meets Click reported. Declines in order frequency and monthly active users drove a 5.8% drop in total online order volume.
With inflation for food at home running at a hot 10%, many consumers—who are now less concerned with COVID than they are with rising prices—are shopping in-store to hunt for deals they might not spot online and to avoid pickup/delivery fees, Brick Meets Click's David Bishop indicated.
"It's no surprise that inflation is affecting where and how people shop online for groceries," Bishop said in a statement. "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."
Delivery sales dollars were down almost 6% vs. the year-ago period, and the monthly active user base for grocery delivery services contracted nearly 9%, Brick Meets Click reported. Delivery order volumes, too, were down in April, sliding 11% vs. April 2021. When shoppers did choose delivery last month, they spent more: The average order value surged 6% year over year to $84.
Pickup's slide in April wasn't as pronounced as delivery's: Pickup dollar sales were down less than 3% year over year, and order volumes fell 2%. Average order values for pickup declined slightly to 81%. Pickup remains the largest channel for online order fulfillment in grocery, accounting for nearly half of online grocery spend.
Ship-to-home continued its decline in April, with sales falling more than 3% and order volumes sliding nearly 6%. The active-user base for ship-to-home shrank, and ship-to-home users received 4% fewer orders in the month.
In search of deals, the share of online grocery shoppers ordering from both conventional grocery stores and superstores increased in April: More than 24% of shoppers who order online regularly from conventional grocers also ordered online from mass merchandisers during the month. Superstores' biggest online users also were 34% more likely than grocery shoppers who order primarily from traditional grocery stores to cite cost as the most important factor in deciding where to buy groceries from online.
"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," Mercatus President and CEO Sylvain Perrier said in a statement. "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."
Brick Meets Click's April Grocery Shopping Survey, sponsored by Mercatus, was conducted April 28-29 with more than 1,700 U.S. adults who participate in their household's grocery shopping.