One Click Retail: Amazon winning online grocery race
Amazon is still in the “trial and error stage” when it comes to competing in the online grocery category, yet its efforts are capturing more wallet share.
The online giant’s grocery sales in the first quarter grew by nearly 50% year-over-year, an increase of over $200 million compared to the same period last year, according to “Amazon Grocery Q1 2018 Update: U.S.,” a report from One Click Retail.
“There is no question that Amazon is winning the online grocery race,” said Nathan Rigby, VP sales and marketing at One Click Retail. “While Walmart (Amazon's top competitor) is actively improving their grocery delivery capa-bilities, that company only captured 9% of the online grocery market in 2017, half of Amazon’s 18% market share.”
Rigby said that Amazon is investing in grocery from numerous angles – Whole Foods, Amazon Go, Prime Now, Pantry – and regardless of what sticks and what doesn't, “every quarter Amazon's share of the online grocery sales channel is getting bigger.”
Coffee remains Amazon's largest grocery category, and one of its strongest growers. Both coffee and the No. 2 category, cold beverages, grew by at least 40% year-over-year to earn more than $140 million in first quarter 2018. Together, these two categories more than quadruple the size of the third top category, snack foods.
Beverages have always been responsible for the bulk of Amazon's Grocery volume. In the first quarter, they made up nine out of 10 bestselling items on Amazon, the study revealed.
However, not everything is growing for Amazon. Amazon Pantry sales are leveling out, with annual growth falling to 14% in the first quarter. Pantry, which packages everyday consumer packaged goods into a single box deliverable for a flat fee of $6, is also going through a change. In early March, Amazon announced that they will be repurposing Pantry as a subscription service, separate from Prime, for a $5 monthly fee.
Pantry sales are not insignificant. They hit $55 million for the quarter, albeit it is growing much slower than the rest of Amazon’s grocery category.
The online giant’s grocery sales in the first quarter grew by nearly 50% year-over-year, an increase of over $200 million compared to the same period last year, according to “Amazon Grocery Q1 2018 Update: U.S.,” a report from One Click Retail.
“There is no question that Amazon is winning the online grocery race,” said Nathan Rigby, VP sales and marketing at One Click Retail. “While Walmart (Amazon's top competitor) is actively improving their grocery delivery capa-bilities, that company only captured 9% of the online grocery market in 2017, half of Amazon’s 18% market share.”
Rigby said that Amazon is investing in grocery from numerous angles – Whole Foods, Amazon Go, Prime Now, Pantry – and regardless of what sticks and what doesn't, “every quarter Amazon's share of the online grocery sales channel is getting bigger.”
Coffee remains Amazon's largest grocery category, and one of its strongest growers. Both coffee and the No. 2 category, cold beverages, grew by at least 40% year-over-year to earn more than $140 million in first quarter 2018. Together, these two categories more than quadruple the size of the third top category, snack foods.
Beverages have always been responsible for the bulk of Amazon's Grocery volume. In the first quarter, they made up nine out of 10 bestselling items on Amazon, the study revealed.
However, not everything is growing for Amazon. Amazon Pantry sales are leveling out, with annual growth falling to 14% in the first quarter. Pantry, which packages everyday consumer packaged goods into a single box deliverable for a flat fee of $6, is also going through a change. In early March, Amazon announced that they will be repurposing Pantry as a subscription service, separate from Prime, for a $5 monthly fee.
Pantry sales are not insignificant. They hit $55 million for the quarter, albeit it is growing much slower than the rest of Amazon’s grocery category.