Online Grocery Retailing - US - June 2019

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
The issues
Online grocery still small but growing fast
Figure 1: Total US online sales of groceries*, at current prices, 2014-19
Most grocery shopping still happens in-store
Figure 2: Approach to grocery shopping, February 2019
Lack of trust a substantial secondary issue
Figure 3: Reasons for not shopping for groceries online, February 2019
The opportunities
Practical reasons, especially time savings, drive online shopping
Figure 4: Reasons for shopping for groceries online, February 2019
Younger grocery shoppers open to ideas as they shop online
Figure 5: Online shopping behaviors, by age, February 2019
Satisfaction with fresh foods correlates with higher online shopping frequency
Figure 6: Attitudes toward online grocery shopping, by frequency of online shopping, February 2019
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Online grocery still small but growing fast
Online food and beverages have momentum and room to grow
MARKET SIZE
Online grocery still small but growing fast
Figure 7: Total US online sales of groceries*, at current prices, 2014-19
MARKET BREAKDOWN
Online food and beverages have momentum and room to grow
Figure 8: Total US online sales of groceries, by segment, at current prices, 2014-19
MARKET FACTORS 
eCommerce overall continues to grow
Figure 9: eCommerce share of total US retail sales, at current prices, 2013-23
Households with children in decline
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Traditional retailers invest in ecommerce
Walmart expands pickup and delivery
WHAT’S HAPPENING?
Traditional retailers build ecommerce capabilities
Kroger sees return on investment in ecommerce
Walmart expands pickup and delivery
Delivery price competition heats up, giving advantage to big players
WHAT’S NEXT?
Bringing it home: developments along the last mile
Autonomous vehicles
A store on wheels
The last yard
Grocers moving toward meals online
THE CONSUMER – WHAT YOU NEED TO KNOW 
Most grocery shopping still happens in-store
Perimeter a focal point for growth of online grocery shopping
Practical reasons, especially time savings, drive online shopping
Lifestage and household composition drive online grocery shopping
In-store shopping experience keeps many from shopping online
Amazon claims most online shoppers as others work to catch up
Frequent online shoppers especially focused on convenience and fresh
Online grocery shoppers less likely to make a separate shopping list
Frustrations relatively low among online grocery shoppers
Satisfaction with fresh foods correlates with higher online shopping frequency
GROCERY SHOPPING OVERVIEW
Most grocery shopping still happens in-store
Figure 10: Approach to grocery shopping, February 2019
Older grocery shoppers a little less likely to shop online
Figure 11: Approach to grocery shopping, by age, February 2019
Perimeter a focal point for growth of online grocery shopping
Figure 12: Approach to grocery shopping, by category, February 2019
In their words: deciding what to buy online
Preferred method by trip type
Figure 13: Preferred approach to shopping, by trip type, February 2019
REASONS FOR SHOPPING ONLINE
Practical reasons, especially time savings, drive online shopping
Figure 14: Reasons for shopping for groceries online, February 2019
Lifestage and household composition drive online grocery shopping
Figure 15: Reasons for shopping for groceries online, by age, February 2019
Frequent online grocery shoppers especially attuned to time savings
Figure 16: Reasons for shopping for groceries online, by online shopping frequency, February 2019
In their words: deciding when to shop online
It’s about time
Check the list
Take control
REASONS FOR NOT SHOPPING ONLINE
In-store shopping experience keeps many from shopping online
Lack of trust a substantial secondary issue
Figure 17: Reasons for not shopping for groceries online, February 2019
Fewer barriers among younger shoppers
Figure 18: Reasons for not shopping for groceries online, by age, February 2019
ONLINE RETAILERS FOR GROCERY PURCHASING
Amazon claims most online shoppers as others work to catch up
Figure 19: Online retailers for grocery purchasing, February 2019
Amazon’s hold is strongest with lighter online grocery shoppers
Figure 20: Online retailers for grocery purchasing, by online shopping frequency, February 2019
REASONS FOR SELECTING ONLINE RETAILER USED MOST OFTEN
Convenient pickup or delivery times especially important to 34-54s
Figure 21: Reasons for selecting online retailer used most often, by age, February 2019
Frequent online shoppers especially focused on convenience and fresh
Figure 22: Reasons for selecting online retailer used most often, by online shopping frequency, February 2019
ONLINE SHOPPING BEHAVIORS
Online grocery shoppers less likely to make a separate shopping list
Figure 23: Shopping behaviors – Online vs in-store, February 2019
Younger grocery shoppers open to ideas as they shop online
Figure 24: Online shopping behaviors, by age, February 2019
List-making more important to heavier online shoppers
Figure 25: Online shopping behaviors, by online shopping frequency, February 2019
FRUSTRATIONS WITH ONLINE GROCERY SHOPPING
Frustrations relatively low among online grocery shoppers
Figure 26: Frustrations with online grocery shopping, February 2019
Shoppers aged 35-54 more likely to be frustrated by service-related issues
Figure 27: Frustrations with online grocery shopping, by age, February 2019
In their words: frustrations with fulfillment
ATTITUDES TOWARD ONLINE GROCERY SHOPPING
Interest in seeing/approving fresh purchases when shopping online
Stores seen as more convenient for smaller purchases
Figure 28: Attitudes toward online grocery shopping, February 2019
Satisfaction with fresh foods correlates with higher online shopping frequency
Figure 29: Attitudes toward online grocery shopping, by frequency of online shopping, February 2019
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Consumer survey data
Consumer qualitative research
Direct marketing creative
Abbreviations and terms
Abbreviations
Terms
APPENDIX – THE MARKET
Figure 30: Total US online sales of online groceries*, at current prices, 2014-19
Figure 31: Total US online sales of online groceries*, at inflation-adjusted prices, 2014-19
Figure 32: Total US online sales of online groceries, by segment, at current prices, 2014-19