Online grocery sales hit $8bn as pickup/delivery edges out ship-to-home services

The online grocery market generated $8bn in sales last month. Of that, $6.7bn came from pickup/delivery services or 67% of total online grocery sales – a record high as measured by Brick Meets Click/Mercatus data – vs. $1.7bn coming from ship-to-home deliveries.

Why is this important to call out given the obvious convenience of pickup/delivery services which often times can be picked up or delivered same day with a wider assortment of items including perishables?

According to David Bishop, partner at Brick Meets Click, the rise in pickup/delivery over ship-to-home services may not be surprising given the steep drop in in-store shopping caused by the pandemic (which is now rebounding), but it is worth noting from a consumer behavior and sentiment standpoint.

“Ship-to-home was figuratively ‘king of the hill’ before COVID hit. Coming into 2020, ship-to-home was 40%+ of ​[online grocery] sales prior to COVID. Today, that number is down to just around 20%,”Bishop told FoodNavigator-USA, adding that prior to the pandemic consumers saw value in the service as a way to procure their favorite brand of cookies or jar of specialty salsa to supplement what may be out of stock at their local grocery store.

But now, delivery/pickup has filled that need for consumers who are seeing less of a need to utilize ship-to-home services, said Bishop.

“What we’re seeing is the perceived evolution that these various forms have, and ship-to-home’s perception of the value it delivers has really degraded over the last 18 months, primarily because people have come to appreciate what they get through pick- up or delivery instead,”said Bishop.

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