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The monthly Brick Meets Click/Mercatus Grocery Shopping Survey is out, reporting that "the US online grocery market finished December with $9.1 billion in total sales, up 2.4% compared to a year ago, and only 2% lower than the record high of $9.3 Billion last seen in Q1 of 2021.

"December’s strong monthly sales results and year-over-year gain was driven by a combination of more households buying groceries online during the month and slightly higher average order values (AOVs) although these still trailed grocery price inflation. The AOV gains were partially offset by lower order frequency among monthly active users (MAUs) in December."

According to the survey, "More than half of all U.S. households ordered groceries online during December, up 4% versus year ago. Pickup benefited the most from this increase in demand as almost 5% more MAUs opted to use this receiving method in December. Delivery was slightly positive, and Ship-to-Home experienced a drop of more than 8% in MAUs. By format, while the Grocery MAU base climbed nearly 7% versus the prior year, the Mass MAU base expanded nearly three times faster and attracted almost half of the total MAU base in December."

The survey goes on:  "Overall order frequency, defined as the number of orders received by an MAU on average during the period, slid 7% versus December 2021 at the aggregate level. By service method, Ship-to-Home’s order frequency contracted twice as much as the aggregate; Delivery’s drop wasn’t as severe but still a double-digit decline; and Pickup saw order frequency grow slightly among its MAUs. By format, order frequency continued to show divergent year-over-year trends as it decreased by 7% for MAUs of Grocery and increased 3% for MAUs of Mass."

KC's View:

No question that inflation is goosing the numbers a bit, but the larger lesson is that while inflation and a recessionary mindset have put the brakes on the warp-speed growth that e-commerce saw during the pandemic, there is a lot of life left in the segment.  In fact, I think the greatest growth may be ahead, not behind.