U.S. online grocery shoppers spend more, are less loyal, and struggle more financially, according to the dunnhumby Consumer Trends Tracker released on Tuesday.
Omnichannel shoppers spend 1.5x more on groceries than in-store only shoppers but spread their dollars between up to 2x as many different retailers. In addition, households that shop online are 6% more likely to have skipped/cut the size of a meal for financial reasons and 10% more likely to have difficulty covering an unexpected expense.
The report hypothesizes that these differences are due to the greater likelihood that omnichannel shoppers have children and pets in their households, which requires higher spending on groceries and can make balancing household budgets less predictable because of the varying demands of its inhabitants.
“What really stands out in this report is that while 60% of all households with children are doing some of their shopping online and despite being higher earners on average than brick and mortar only shoppers, they are struggling more financially, and some reported they have had to skip or cut back on meals,” said Grant Steadman, President for North America at dunnhumby. “This indicates an evolution from the orthodoxy that the online and omnichannel shoppers value convenience above all and are not price sensitive. This study suggests that is not always the case.”
The study also found that perceived out-of-stocks online are 7% greater than in-store, highlighting the need for eCommerce as a channel to better deliver on operational fundamentals. As a result, omnichannel shoppers visit up to 6.6 different retailers monthly, making them a valuable but hard-to-win customer segment.
The dunnhumby Consumer Trends Tracker is part of The dunnhumby Quarterly, a new strategic market analysis of key retail themes, with the first edition focusing on eCommerce.
The Consumer Trends Tracker was launched in May 2022 to over 2,000 consumers online, representative of the U.S. grocery shopper nationwide. It is designed to uncover shoppers’ needs, perceptions, and behaviors over time and to complement dunnhumby’s Retailer Preference Index, which measures the strength of retailers’ customer value proposition.
Other key findings from the study:
- eCommerce shoppers face more time and financial pressures than brick and mortar only shoppers. The CTT study found that 70% of in-store shoppers versus 72% of online shoppers rated it very or extremely important that the retailer had lower prices than other retailers – numbers that are virtually the same.
However, when forced to make trade-offs, eCommerce shoppers more carefully balance time savings with money savings, while brick-and-mortar shoppers are 2x more likely to choose a store because of prices.
This reflects the busier lifestyle of the average omnichannel shopper, who is much more likely to be a caregiver of children or pets and has the added stress of not only balancing budgets but balancing time.
- Online and omnichannel shoppers spend more on groceries than in-store only shoppers, but they are less loyal. The vast majority of the 45% of consumers who shop for groceries online is omnichannel shoppers.
Their monthly average grocery spend is $594 per month compared to $388 for in-store-only shoppers. But online shoppers spread their dollars across a more significant number of retailers monthly – between 3.9 to 6.6 stores per month compared to 3.2 for in-store only.
- The channels with the highest eCommerce penetration are mass (29%), traditional format (24%), and pure-play (17%), in absolute terms. In relative terms, mass, convenience, and drug stores do best to convert brick and mortar shoppers to online shoppers. Dollar stores and discounters are the least effective at this.
- Shoppers are less adventurous with their online shopping missions than brick-and-mortar, executing 3x more mission types in brick-and-mortar stores than online. Non-food-focused shopping trips are the least common in-store but the most common online. Other popular online categories reflect the young family shopper profile, including baby care, ready-to-eat, organic, and alcohol.
- Brick and mortar-only shoppers can still be digital customers. Almost one in five current in-store-only shoppers interact with a store’s app. They use it predominately to browse the weekly ad/circular, check their rewards/points/coupons available, and plan their shop/shopping list.