Online grocery usership settles into ‘new normal’, finds Chicory survey

The pandemic accelerated the adoption of many online grocery services and in April 2020, 63.41% of Chicory’s survey respondents reported purchasing groceries online in the past 60 days compared to 53.46% in January 2020.

In its Q3 survey, which polled 2,200 consumers, Chicory​​ found that online grocery usership dipped slightly in July to 60.33%, which the company attributes to the reopening of some restaurants and bars across the country and consumers getting used to wearing masks and social distancing when going out to run errands.

Changes in online grocery frequency indicate the beginning of a period of stabilization in the industry as those who tried grocery delivery or pickup services are now deciding whether they want to integrate it into their regular shopping routines or return fully to brick and mortar, said Chicory.

According to its Q3 survey, 61.98% of respondents said that they add to their online shopping carts weekly or more often, a 5.72% drop from Q2.

The most dramatic shift in the survey was in consumer spending. In Q2, the amount of respondents who spent less than $25 per purchase dropped by 81.42% as shoppers hunkered down at home. In fact, most respondents (30.63%) spent between $50 to $75, followed by the highest tier, $100+ (24.69%) in Q2.

From Q2 to Q3, the amount of consumers spending $25 or less on online shopping trips increased by 38%, while consumers spending more than $100 fell by 8.88%.

This suggests that consumers have shifted to more “normalized”​ shopping patterns using online grocery services and placing smaller orders to supplement their regular in-store shopping trips, said Chicory.

Preferred retailers​

From Q1 to Q2, Instacart and Peapod usage grew to the detriment of Walmart Grocery and AmazonFresh, which dropped by 11.63% and 29.96%, respectively.

From Q2 to Q3, Shipt saw the biggest growth (+66.57%) followed distantly by Instacart (+14.22%), AmazonFresh (+13.87%), and Kroger (+12.31%).

The report attributed Instacart’s success to its business model of offering a variety of retailers, rather than limiting to just one, many of which failed or struggled to meet demand during the height of the coronavirus outbreak.

“It’s not a coincidence that both are grocery marketplace platforms, as a new report revealed that Instacart surged past Walmart to reach the majority share (57%) of the online grocery market,”​ the survey said.

All but one retailer (Peapod – 0.11%) increased in usage from Q2 to Q3, a clear indication that there are simply more online grocery shopping customers, noted Chicory.

"As with previous quarters, consumers still add to their online grocery carts and shop online weekly or more often, demonstrating that online grocery patterns may be here to stay,"​ said Chicory.