Most consumers may be cutting back on their spending to stick to the basics, but a growing number are still showing willingness to pay top dollar for convenience when it comes to shopping. groceries.
Online grocery adoption is on the rise, according to data from PYMNTS’ April study, ConnectedEconomy™ Monthly Report: 3 Ways Consumers Are Dealing With Inflation. The report, which is based on a March survey of more than 2,800 American adults, found that 31.6% of consumers said they ordered groceries online that month, up from 4.9% compared to February.
Read more: 6 in 10 consumers buy only the essentials as inflation rises
Not surprisingly, given the shipping and convenience costs typically associated with the channel, consumers who are less careful with their spending are the most likely to buy from eGrocers. The study found that 61% of all US consumers buy mostly necessities, 10% of the population live a lot (spend more freely, with major purchases, including big ticket items), 23% do occasional splurge on smaller items and the remaining handful of consumers are “low-need” shoppers, i.e. those who have not made retail purchases of any kind in the previous month, with the exception of groceries.
In fact, the study found that 55% of consumers who live in a major area regularly receive a grocery or meal kit subscription, 61% bought groceries online for delivery in March, 67 % shopped online for curbside pickup and 58% used the same daytime delivery aggregator like Instacart. By contrast, only 18% of consumers who don’t need much received a grocery or meal kit subscription, 25% bought online for delivery, 16% for curbside pickup, and 22% with an aggregator.
Notably, while high spenders’ adoption of online grocery delivery and curbside pickup options increased in March, their adoption of grocery and meal kit subscription services and aggregators actually dropped. Meanwhile, consumers who don’t need much adoption of all online grocery channels except curbside pickup increased during the month.
Where initial adoption of online grocery options may have been driven by pandemic concerns, the space has continued to grow even as those concerns have faded.
“COVID has driven some online ordering from demographics, especially some of the baby boomers who in the past weren’t as geared towards online shopping, especially for groceries,” Debbie GuerraExecutive Vice President of On-Demand Merchant Solutions at ACI in the world, said PYMNTS in an interview in December. “We’ve seen with millennials, Gen-Zers, that they’re already eager to continue embracing digital payments. What has happened, however, is that as COVID has continued, the continued shift to digital has taken hold.
See more : Supermarkets are rethinking physical and digital aisles for the connected future of grocery shopping
Plus, online grocery shopping is getting smarter.
“[There’s now] the expectation that your online grocer will understand you, the expectation that they will save you time, the expectation that the next time you come there, they will be able to really offer you a better reflection of what you have need, as opposed to the same models that you would see in a physical grocery store,” Alex Weinstein, digital director of online grocer Hungryroot, told PYMNTS in a January interview. “If in 2020 the typical shopping model was to go to your online grocery destination and hit the restock button, today consumers want more. They want variety. They want recommendations.
Read more: eGrocery customers expect more than digital shelves; They expect personal relationships