Dive Brief:

• Online grocery has continued its momentum during the pandemic, with sales in April totaling $8.4 billion — up 16% since one year ago, according to figures published Tuesday by Brick Meets Click.
• While last month’s sales were lower than the $9.3 billion records hit in March and January, the firm noted in its latest e-commerce report that they were four times higher than pre-pandemic figures.
• Click-and-collect and delivery sales totaled $6.6 billion, while ship-to-home accounted for $1.8 billion last month — similar to e-commerce sales last May, which indicate that online shopping is still relevant even as more shoppers get fully vaccinated against COVID-19 and return to stores. “Online shopping has remained an attractive way to buy groceries for a sizable segment of the U.S.,” David Bishop, partner at Brick Meets Click, said in the findings.

Dive Insight:

The latest findings from Brick Meets Click show favorable online sales results on a year-over-year basis, but the up-and-down monthly trends so far in 2021 highlight volatility in the online channel as shoppers return to in-store shopping.

While 12% fewer U.S. households bought groceries online last month compared to the same time in 2020, monthly active users placed more pickup and delivery orders, which accounted for 78% of overall sales, Brick Meets Click found. These active users placed on average 2.73 online orders in April, up from 2.68 in the same month last year, indicating an opportunity for grocers to deepen loyalty among their most engaged shoppers. 

At $1.8 billion last month, ship-to-home sales were down from $2.1 billion in March and $1.9 billion a year ago. Compared to a year ago, ship-to-home’s share of online orders dropped 9 percentage points, while pickup and delivery perked up 6 and 3 percentage points, respectively. Ship-to-home also largely accounted for the drop in average order value of online orders in April, which was down 6% year-over-year. 

April's online grocery sales contracted 10% compared to the prior month as more shoppers, including seniors, get vaccinated and return to stores. This combined with waning customer satisfaction could be a worrying sign for retailers that are investing in their e-commerce properties. The proportion of adults in April who said they will use the same grocery service again, 55%, was down 7 percentage points from 62% in March and was below 58% in February and 56% in January. 

“As the country opens, we’re consistently seeing double the number of active online shoppers compared to pre-COVID,” Sylvain Perrier, president and CEO of Mercatus, which sponsored the survey, said in the press release. “At the same time, we know there’s increasing frustration with poor execution as evidenced by the widening repeat purchase gap between first- and fourth-time online customers.”

Perrier said retailers need to maximize the value of their online offerings and “deliver a top-notch ordering and fulfillment experience” in order to retain and attract customers. Grocers might not want to focus all of their efforts on one e-commerce service, per the survey’s findings that a growing share of adults (35%) used two or more methods for their online grocery orders in April, compared to roughly 32% in April 2020 and 15% in August 2019.

"Last year, retailers were in a race to meet the dramatic surge in demand," Bishop said in the press release. "This year, it’s about executing a sound and sustainable strategy, with the imperative squarely on improving integration and implementation.”