The U.S. online grocery market finished January with total sales of $8.5 billion, up 1.8% compared to 2023, according to the most recent monthly Brick Meets Click/Mercatus Grocery Shopper Survey.
Despite a jump in the total number of households buying groceries online during the month, January’s overall sales growth was moderated year-over-year by a downward trend in order frequency and a composite average order value (AOV) that was nearly flat compared to the prior year.
“When more than 10% of U.S. households have less money to spend on groceries this year than they did last year, changes in buying behavior are certainly expected,” says David Bishop, partner at Brick Meets Click. “The reduction in SNAP payments that took effect at the end of February 2023 is one of the factors driving the flight-to-value trend which we’ve observed and tracked since mid-2023.”
Key takeaways:
- Ship-to-home was the only segment to grow year-over-year as sales climbed to $1.5 billion in January, up 7.8% compared to a year ago.
- Delivery sales of $3 billion slipped slightly, down 0.5% vs. 2023, as the 3% growth in its AOV could not offset the larger decline in order volume.
- Pickup remained in the top spot, but sales fell 1.9% to $4 billion for January mainly due to lower order frequency by MAUs and a 1.8% contraction in AOV, despite a moderate expansion of its MAU base.
- The mass format continued to outperform the broader market.
- In contrast, supermarkets endured ongoing headwinds as key performance indicators (KPIs) all struggled vs. last year. The number of supermarket MAUs contracted by more than 5%, the average number of orders completed by MAUs during the month fell by a larger rate, and the average dollars spent per order pulled back slightly.
- Cross-shopping between mass and grocery (which includes supermarket and hard discount) decreased slightly in January vs. the prior year.
"Competing online is only getting more challenging for regional grocers as customer expectations continue to increase," says Mark Fairhurst, global chief growth officer at Mercatus. "So, beyond improving key elements of the experience, like fill rates, wait times, and product quality, regional grocers also need to work even harder to identify additional ways to help their customers save money."
