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Trendspotting: Back-to-school, back to buying

By
Craig Levitt

It was anything but the dog days of August for the grocery industry. Buoyed by the back-to-school season, the online grocery market grew 8.7 percent compared to last year, generating $9.3 billion in sales for August 2023, according to the latest monthly Brick Meets Click/Mercatus Grocery Shopping Survey. Pickup and Ship-to-Home were strong, while Delivery experienced a slowdown in order volume. Mass continued to attract many more customers than Supermarkets.

The August monthly active user (MAU) base expanded nearly 5 percent compared to a year ago. Ship-to-Home expanded by over 9 percent and Pickup increased by nearly 6 percent. Delivery was up less than 1 percent.  

Total volume of online grocery orders placed during August 2023 grew 5 percent versus last year. Order volume growth was unevenly distributed. Delivery, the only method to post a decline in order volume, fell almost 5 percent, while Pickup and Ship-to-Home climbed 9 percent and 10 percent, respectively compared to 2022. The results also revealed that Amazon’s pure-play segments (marketplace, Subscribe & Save) contributed significantly to Ship-to-Home’s strong performance as its order volume finished up over 10 percent higher than last year.

“The combined average order value for all three fulfillment methods grew 3 percent versus the prior year in August, which is below the current rate of inflation for the wider variety of grocery-related products that regional grocers often sell and extends beyond the Food-at-Home category,” said David Bishop, partner at Brick Meets Click. “For grocers, it is important to see the specific trends for each method as Pickup posted the highest gain of 6 percent, followed by Delivery, up 4 percent, and Ship-to-Home, up 3 percent, compared to a year ago.”

Trends for the two formats with the largest MAU bases, mass and supermarket, continued to diverge from each other in two of three key performance indicators. The mass MAU base surged by almost 20 percent in August while supermarkets contracted by more than 10 percent. Similarly, order frequency for mass rose in the low single-digits but fell in the mid-single digits for supermarkets versus the prior year.

“Online customer loyalty is increasingly elusive, and grocers should focus on creating more seamless experiences that keep shoppers — especially the first timers coming back,” said Sylvain Perrier, president and CEO of Mercatus. “By providing personalized recommendations and promotions, based on shopping history and personal preferences, grocers can strengthen connections with their customers that go beyond simply the transaction and increase the likelihood of repeat business.”

Craig Levitt

Craig Levitt

About Craig Levitt  |  email

When his dreams of becoming a professional hockey player came crashing down due to lack of talent, Craig Levitt turned to journalism. He graduated from Hofstra University in 1992 and has covered various areas of the retail food trade since 1996. Craig joined The Produce News in 2017 and is now managing editor. In his spare time, Craig still plays men’s league hockey (poorly) and enjoys walking the aisles of his favorite supermarket with his wife and two daughters.

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