The U.S. online grocery market ended December 2024 with $9.6 billion in monthly sales, an 18.7% increase over last year as all three fulfillment methods posted year-over-year sales gains, according to a Brick Meets Click/Mercatus Grocery Shopper Survey fielded Dec. 30-31.
December marks the fifth straight month of e-grocery sales above $9.5 billion and caps off a year that essentially reflected two periods: before and after the appearance of discounted promotions on subscriptions and/or membership programs, according to a news release.
Overall e-grocery sales during the first half of 2024 were basically flat, posting only a 0.3% gain versus the first half of 2023. During the second half of 2024, however, e-grocery sales surged 17.7% year over year, driving annual sales up 9.1% versus 2023.
All three receiving methods reported similar shifts in their sales performance between the first and second half of the year, according to the release. Delivery’s growth rate increased from less than 4% in the first half of 2024 to more than 25% in the second half. Ship-to-home’s growth rate also jumped dramatically, increasing from 5% to approximately 20% between the two periods. Pickup, which declined 4% during the January to June period, posted a nearly 8% gain during the July to December 2024 period, the release said.
The main difference between the two periods was the broad presence and aggressive promotion of annual subscriptions or memberships that began in mid-year and have continued off and on since then, the release said. Discounts, ranging from 33% to 80% off, were seen from a variety of marketplace providers, mass retailers, plus national and regional supermarkets as well.
“While subscriptions and memberships aren’t new, the deep discounts were new, and they resonated with customers by offering the opportunity for significant savings,” said David Bishop, partner for Brick Meets Click. “As a result, customers are more vested in their provider of choice, motivating many to place more orders which helps those providers to gain a larger share of the grocery wallet and improve engagement and retention rates.”
Looking at the monthly sales results for December 2024, each receiving method posted year-over-year gains, reversing the sales decline that all three reported in the prior year. Delivery grew 24.6% year over year in December to $4 billion, accounting for 41.7% of total e-grocery sales, up from 39.8% last year. Pickup monthly sales rose 5.3% year over year to $3.8 billion, as it ceded 500 basis points of share versus last year and finished with 39.4%. Ship-to-home sales surged nearly 40% year over year to $1.8 billion, contributing 18.9% of total e-grocery sales, up from 15.9% in December 2023, the release said.
Grocery operators continue to face increasing challenges to online growth, especially given the stiff competition from mass retailers, the release said. In terms of penetration, more than half of all monthly active users completed one or more online grocery orders with a mass retailer during December 2024, while only approximately one-third of all monthly active users completed at least one online order with a grocery operator. (Grocery includes both supermarket and hard discount formats.)
As for cross-shopping, one-third of grocery’s monthly active user base also completed an order with a mass retailer in the same month, jumping over 800 basis points in December 2024 versus last year. And, when it comes to the likelihood that a customer will use the same service again within the next 30 days, mass continues to post stronger repeat intent rates for both delivery and pickup services than grocery, although the gaps have narrowed versus last year, the release said.
“Regional grocers looking to boost e-grocery sales should focus on delivering real savings and targeted loyalty perks,” said Mark Fairhurst, chief growth marketing officer for Mercatus. “By leveraging AI-driven personalization and integrated loyalty solutions, grocers can convert occasional shoppers into loyal digital customers, driving repeat orders and larger baskets across both online and in-store channels, to fuel sustained growth.”
For more information about December 2024 results, check out the latest Brick Meets Click e-grocery Dashboard.
