eGrocery sales rise 1.5% as Walmart gains

Seeking value

The gain in users continued a growth trend that was also evident last year in February, when the number of people ordering only increased 10%. Average order value also increased 5%, indicating spending was up. But this came as volumes declined, as the number of orders fell by 9% to reach its lowest level since before the pandemic.

“The expanding user base for online grocery illustrates its growing reach, but the changing role it plays is evident from contractions in the use of multiple receiving methods and average order frequency, which mostly muted the gains in reach,” said David Bishop, partner at Brick Meets Click, in a statement.

Mass vs. grocery

In grocery ecommerce, mass retailers like Walmart and Target are continuing to attract a growing number of shoppers as they improve omnichannel capabilities, and offer price relief amid inflation.

The monthly active user base for mass grew 20% year-over-year in February. This came after a big jump in January, as well. By contrast, the grocery user base declined in the mid-to-upper single digits, per BMC.

“The changes in the mass and grocery user bases illustrate what could be characterized as a ‘flight to value’ as shoppers deal with persistently higher grocery prices,” Bishop said. “Another sign of inflation’s impact on eGrocery ordering patterns is the continued growth that pickup has experienced over the last few months, while delivery has encountered a pullback in users.”

Walmart has boasted gains among higher-income consumers, and there are signs in the data that the largest retailer is the chief beneficiary of the surge toward mass. The number of shoppers who went to both Walmart and a grocery store was up about 5% to almost 22% in February. Meanwhile, cross-shopping with Target declined by nearly three percentage points.

Walmart’s share gains during a downturn may provide a lesson for all.

“Given that ongoing price inflation is clearly influencing shopping behaviors, grocers should promote ways customers can save more money,” said Sylvain Perrier, president and CEO of Mercatus. “Grocery retailers can consider highlighting store brands, offering pricing promotions, creating personalized digital coupons, and implementing variable fee structures that lower fees for customers and reduce the cost to assemble.”