The U.S. online grocery market posted $8.1 billion in total monthly sales for November, up 5.2 percent compared to last year’s $7.7 billion, according to the monthly Brick Meets Click/Mercatus Grocery Shopping Survey fielded November 29-30, 2023.
While pickup, delivery, and ship-to-home all contributed to the year-over-year sales growth, grocery delivery reported the largest gain, driven by a significant jump in its monthly user base versus the prior year. Also, last month, mass retailers (e.g. Walmart, Target) surpassed supermarkets to become the primary retail format that most households relied on for their grocery purchases during the month, both online and in-store.
For November, research showed that 42 percent of U.S. households used a mass retailer for most of their in-store or online grocery purchases during the month, finishing 3.9 percentage points higher than supermarkets for the same period.
“The current economic realities and omnichannel strategies are aiding mass retailers in attracting more customers today,” said David Bishop, partner at Brick Meets Click, in a statement. “The price advantage that a mass rival, such as Walmart enjoys is motivating cash-strapped households to shift where they shop, and mass customer engagement strategies are making it easier for those customers to shop the way they want.”
Below are some insights broken out by online grocery method:
Delivery experienced an 8.6 percent year-over-year sales growth, primarily driven by gains in its monthly active user base which helped grow order volume by 7.5 percent despite an increase of just 1 percent in average order value. Delivery accounted for nearly 33 percent of all digital sales in November 2023, up 2.5 percentage points versus last year.
Pickup sales grew only one percent during November compared to a year ago, boosted by average order value growth of 11.8 percent. This was tempered by a decline in its monthly active user base and lower order frequency which together pulled order volume down 9.2 percent versus last year. Pickup’s penetration among all age groups declined in the month versus 2022, it is unclear why according to Brick Meets Click.
Ship-to-Home sales climbed 7.6 percent driven by solid monthly active user growth in Amazon’s pure-play services. Despite a softened order frequency rate, this growth led to a nearly 3 percent increase in overall order volume, and a 4.5 percent increase in average order value contributed to the balance of the sales gains in November.
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