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eGrocery sales rise 1.5% as Walmart gains
Monthly active users rose 5%, according to data from Brick Meets Click and Mercatus.
eGrocery sales rose in February, as more users signed on for services like pickup and delivery.
Data from Brick Meets Click and Mercatus for February 2023 showed the following:
- Egrocery sales totaled $8.8 billion.
- That’s an increase of 1.5% over February 2022.
- Monthly active users increased 5%, driving the gains.
- Pickup sales increased nearly 5%, while delivery fell by nearly 9%.
US online grocery sales. (Courtesy photo)
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.”
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Kellogg's takes inspiration from employees, Latin in snacks rebrand
Kellanova is now the parent of Pringles, Cheez-Its and Pop Tarts.
Kellogg Company's snacks business is now Kellanova. Here are a few finer points about how the forthcoming parent of Cheez-Its and and Pop-Tarts arrived at the new name.
Last year, Kellogg announced plans to split its business into multiple companies.
Now, one company will have North American cereals like Frosted Flakes, Froot Loops and Rice Krispies under the WK Kellogg Co banner.
Another will have snacks like Pringles, North American frozen foods such as Eggo and plant-based brands like MorningStar Farms.
This week, Kellogg announced that the snacks business has a new name: Kellanova.
Here are the strategies that Kellogg employed that led to this name:
- Ask the employees: Kellogg Company asked employees for input on the name, and received 4,000 suggestions from 1,000 employees.
- Listen to the results: 20% of the employees suggested a variation of the W.K. Kellogg name, while other employees suggested that the name include "nova."
- Go to the root: "Nova" comes from the Latin word for new. CEO Steve Cahillane said it "signals our ambition to continuously evolve as an innovative, next generation, global snacking powerhouse."
As The Wall Street Journal reports, this is just the latest new company name to take a Latin root in recent years, as Kellanova joins GE Vernova, Mondelez and Altria. It's also among a number of spinouts being completed by corporations, joining GSK spinoff Haleon, J&J's Kenvue and a forthcoming company that will spin out of 3M.
Even with a name that emphasizes moving forward, Kellanova is keeping one element that is familiar: The logo still has the iconic cursive K. It will even get the boldly simple stock ticker symbol "K" to go along with it.
Even the WK Kellogg Co is combining the past and future. The company is seeking to position itself as a "117-year-old startup," even as it draws on the name and signature of the Kellogg's founder. There's even a more subtle hint about an unwritten chapter: The "Co" doesn't have a period.
To get to the future, you need to bring along a bit of the past.