Top Line

Aprilonline grocery sales pulled back 3.8% versus last year, finishing at $8.1 billion,as total order volume dropped 5.8% driven by lower order frequency and a slightlysmaller monthly active user (MAU) base, according to the Brick MeetsClick/Mercatus Grocery Shopping Survey fielded April 28-29,2022. The evidence suggests that customers aremore likely to be concerned about the impacts of inflation than contractingCOVID-19.

"It’sno surprise that inflation is affecting where and how people shop online forgroceries," said David Bishop, partner at Brick Meets Click. "Some customersmay now find Pickup a more attractive service since it can help them avoid thehigher incremental costs associated with Delivery, and others may choose tosimply move more of their transactions back into the store."

Key Findings & Insights

Evidence suggests that today’s eGrocery customers are more likely to be concerned aboutthe impacts of inflation than contracting COVID-19.

Analyzing responses fromMarch and April 2022 related to an MAU’s most recent online order found that Masscustomers were 34% more likely than Grocery customers to indicate that cost (i.e.,not paying more than necessary) was the most important factor in deciding whereto buy groceries online.

When it came to how online grocery orders werereceived, Pickup customers who used Grocery or Mass were respectively 18% and 11%more likely to cite cost as the primary consideration whencompared to Delivery customers.

Sales in all threesegments declined but Delivery drove almost half of the month’s contraction.

Delivery-relatedsales, which accounted for almost one-third of total online grocery salesduring April, dropped nearly 6% versus a year ago and contributed nearly halfof the decline in total sales year-over-year.

• The segment’s average order value (AOV) jumped 6% to $84 versus April2021, helping to mitigate an 11% decline in order volume.
• The order volume decline was mainly drivenby an MAU base that contracted nearly 9% over the past year.

Ship-to-Home,the smallest segment with just over one-fifth of the sales in April, fell over 3%versus last year.

• Order volume drove the decline, dropping nearly 6% versusApril 2021, while the AOV increased by almost 3% to $47.
• The decline in order volumewas the result of a contraction in the MAU base of more than 2% as well as MAUsreceiving 4% fewer Ship-to-Home orders during the month.

Pickup,the largest eGrocery segment with almost half of total sales, declined by lessthan 3% versus the prior year.

• Unlike the other two segments, Pickup reported anominal drop in AOV of approximately 70 basis points to $81; this, combined witha 2% drop in order volume, contributed to the year-over-year decline in sales.
• VersusApril 2021, Pickup’s MAU base shrank by less than 3% and order frequency amongits MAUs was essentially unchanged.

Cross-shopping between grocery and mass gained momentum.

Despite the year-over-yeardrops in both order volume and the MAU base, the share of Grocery’s MAU base that also shopped online with Mass during the month increased just over 40 basis points versus last year, finishing at 24.2% for April 2022.

Repeat intent: Overall level higher vs year ago & Mass regains top spot

The likelihood for an online grocery shopper to use the same service again within the next month also increased during April, climbing to 68%, up 8 percentage points on a year-over-year basis.

• Analyzing month-over-month results showed that repeat intent rates at Mass providers slid 3 points in April, while Grocery’s intent rates climbed more than 50 basis points.

Share of wallet down slightly vs. last year

In terms ofshare of wallet, total eGrocery finished April at 12.3%, down slightly from lastyear’s 12.7%. When excluding Ship-to-Home (since most conventional grocers don’toffer this service) the combined Delivery and Pickup segments finished themonth at 9.6%, down about 30 basis points versus 2021.

Sponsor Message & Appreciation

“With budgetconscious consumers naturally gravitating towards lower cost online serviceslike Pickup, grocers need to find ways to offer these services profitably andremain competitive,” said Sylvain Perrier, president and CEO, Mercatus.“Conventional grocers can take advantage of more efficient pick and packpractices. They can also use tiered pricing models and variable fee structuresto offset the cost to serve while still providing a compelling Pickup experience tocustomers.”

We thank the team at Mercatus for their continued generous support of this research. Click here to see the May 9, 2022 press release .

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About this Consumer Research

The Brick Meets Click/Mercatus Grocery Shopping Survey is an ongoing independent research initiative created and conducted by Brick Meets Click and sponsored by Mercatus.

Brick Meets Click conducted the survey on April 28-29, 2022,with 1,746 adults, 18 years and older, who participated in the household’s grocery shopping. This research is scheduled to run monthly through 2022; then the cadence will be reevaluated to best suit the industry’s needs.The three receiving methods for online grocery orders are defined as follows:

• Ship-to-Home includes orders that are received via common or contract carriers like FedEx, UPS, USPS, etc.
• Delivery includes orders received from a first- or third-party provider like Instacart, Shipt or the retailer's own employees.
• Pickup (aka curbside) includes orders that are received by customers either inside or outside a store or at a designated location/locker.

Results were adjusted based on internet usage among U.S. adults to account for the non-response bias associated with online surveys. Responses are geographically representative of the U.S. and weighted by age to reflect the national population of adults, 18 years and older, according to the U.S. Census Bureau.

Brick Meets Click used a similar methodology for each of the surveys conducted in 2022 - Mar. 28-29 (n= 1,681), Feb. 26-27 (n=1,790),and Jan. 29-30 (n=1,793); in 2021 – Dec. 29-30 (n = 1,836), Nov. 29-30 (n=1,785), Oct. 29-30 (n=1,751), Sept. 28-29 (n=1,728), Aug. 29-30 (n=1,806), July 29-30 (n=1,892), June 27-28 (n=1,789), May 28-30 (n=1,872), Apr. 26-28 (n=1,941), Mar. 26-28 (n=1,811), Feb. 26-28 (n= 1,812), and Jan. 28-31 (n=1,776); in 2020 – Nov. 11-14 (n=2,067), Aug. 24-26 (n=1,817), Jun. 24-25 (n=1,781), May 20-22 (n=1,724), Apr. 22-24 (n= 1,651), and Mar. 23-25 (n=1,601); and in 2019 – Aug. 22-24 (n = 2,485).