Online grocery order rate moves closer to pre-COVID level

Fewer and smaller orders for online groceries caused a 3.1% year-over-year market decline in September, resulting in $7.5 billion in sales, according to a Brick Meets Click/Mercatus Grocery Shopping Survey released Tuesday.  

The base of users expanded, though, during the month, which “softened the slip in overall sales and signaled continued interest in buying groceries online,” the report noted. 

Pickup’s household penetration increased to 59% of monthly active users—its highest household penetration ever—while delivery and ship-to-home both fell to 39% and 40%, respectively. 

The drop in sales was mainly a result of an 8% year-over-year drop in monthly active users (MAU). The order rate hit its lowest level since the onset of the COVID pandemic, ending the month at 2.31. That’s about 14% higher than the 2.03 orders per month recorded in August 2019. 

The rate of MAU who only purchase one order increased to nearly 37%, reaching the highest pre-COVID level. Meanwhile, those making three or more orders had a year-over-year decline of 370 basis points. 

“The downward movement in order frequency impacted most retail formats to varying degrees,” the report added. “Mass retailers experienced a 4% decline in order frequency among its monthly active user base, while Amazon’s pure-play segments dropped 7% and supermarkets fell nearly 13% in September versus a year ago.” 

Related:Mass merchandisers trounce supermarkets in online sales in August

Pickup, delivery and ship-to-home experienced increases in their monthly active user bases for households placing at least one order, according to the report. The three categories saw their MAU bases collectively increase by 11% year over year, fueling a 2% gain in order volume. Supermarkets gained 1% in their MAU base, while mass retailers jumped nearly 20% year over year.

Average order value dropped 5% for all digital categories, with pickup registering the largest decline, ship-to-home a small dip and delivery remaining flat year over year. Supermarket average order value was also flat, while mass merchant orders dropped 9%. That’s likely due to the rapid growth of the MAU base, the report noted. 

“Both pickup and Walmart are growing share in today’s market for a range of reasons,” stated David Bishop, partner at Brick Meets Click, in a statement. “Each helps customers who are searching for ways to save money, while pickup provides more flexibility as to when an order is received by the customer compared to delivery.” 

Those shopping at both grocery stores and mass merchandisers was up again this month, compared to the same period last year, increasing by 40 basis points to 28%, according to the report. The rate who said they are extremely or very likely to use the same service next month dropped 340 basis points to 52% for grocery and was down 860 basis points to 57% for mass. 

Related:Walmart now accounts for one-third of all online grocery sales

“Motivating customers to shop with you again online may be challenging—especially when many households are trying to stretch a buck—but attracting new ones is even harder,” said Mercatus President and CEO Sylvain Perrier in a statement. “To compete more effectively, in addition to promoting more types of money-saving offers such as loyalty rewards, bundled deals, or other promotions, grocers can emphasize the quality, service and convenience they offer that big-box retailers don’t.” 

Online orders accounted for 12.6% of the total weekly grocery spend for the final week of September, up 160 basis points compared to the same time in 2022. Pickup and delivery climbed 150 basis points to 10.5%.