US e-commerce grocery sales grew 8% year over year in June to $7.7 billion, according to data from Brick Meets Click and Mercatus released this week.
The bump was largely thanks to an increase in delivery sales, which rose 18% YoY to $2.9 billion and accounted for 38% of overall e-commerce grocery sales for the month. Brick Meets Click partner David Bishop noted in a statement that delivery in June was boosted by promotions from Instacart and Walmart, offering deals on annual membership fees.
Despite delivery’s gains, pickup remained the largest sector of online grocery, at 45%. It brought in $3.5 billion in June, unchanged from a year ago. While monthly active users increased, average order value and order frequency declined. Ship-to-home, while the smallest of the three segments at 17%, saw sales rise for a fourth straight month, up 10% YoY to $1.3 billion.
Shoppers continued to purchase across different grocery channels; nearly one in three consumers bought from both grocery (supermarkets and discount stores) and mass retailers (big-box stores). The share of grocery shoppers who also ordered online from a mass retailer was 31.6%, while those who ordered from Walmart was almost 22%. And Walmart’s grocery business shows no signs of slowing down: Last week, the retailer announced plans to open five automated distribution centers for fresh food sold in store and through e-commerce orders.
But, but, but…While e-commerce grocery had a strong month, there’s still some cause for concern. The overall repeat intent rate for June was down almost 7% YoY to 56%, and the grocery channel’s repeat intent rate dropped twice as much as mass’s year over year. Data from online and in-store food purchases indicates more potential trouble for the grocery channel, as the mass format grew its share of all purchases to 42%, while supermarket’s dipped to 39%. Mark Fairhurst, chief growth officer at Mercatus, noted regional grocers can work to regain share by offering “personalized and targeted promotions” and by “incorporating high-level, in-store customer service into the digital experience.”