Who were the January 2023 winners and losers in online grocery?

Key digital grocery metrics increased in January 2023, but not every grocery e-commerce player benefited.

According to the January 2023 “State of Digital Grocery Performance Scorecard” from the Grocery Doppio platform managed by Incisiv and Wynshop, digital grocery sales, basket size, and items/basket all rose year-over-year in the first month of 2023. Digital baskets averaged four items more in January 2023 than they did in January 2022, a 39.7% increase.

Digital sales grew slightly year-over-year to $10.7 billion from $10.4 billion. However, at 14.7% of overall grocery sales, digital’s share of the total market reflected a decline from 15.2% in January 2022 and from the November 2022 high of 17.1%.

Third-party online grocery providers were largely excluded from overall growth in sales and basket sizes. Scorecard data indicates digital grocery sales through third parties fell to $1.9 billion in January 2023, reflecting 18.1% of digital grocery sales.

This represents a huge loss for third parties since January 2022, both in total dollar amount (down 73% to $1.9 billion from $3.3B) and in terms of total share of the digital grocery market (down 42% to 18.1% from 31.3%).

Share of grocery pickup sales continues to rise

Incisiv and Wynshop also tracked an increase in usage of curbside/shopper pick-up, which rose to $6.2 billion, or 57.9% of all digital grocery orders, in January 2023, while delivery's share declined to 42.2%.

This represents an extension of the increase in pickup's share of digital grocery orders which the scorecard has tracked since January 2022, which saw pickup represent 53.3% of all digital grocery orders, with delivery accounting for 46.7%.

Sustainability trends

The scorecard also examined some interesting trends in grocery sustainability:

• Seven in 10 (71%) of surveyed grocers regard sustainability as a key priority in 2023, while 76% also regard it as a C-level issue.
• More than four in 10 (43%) surveyed grocers will appoint a senior executive to lead their sustainability efforts in 2023.
• Waste reduction is grocers' primary sustainability focus (86%), followed by energy efficiency (77%) and packaging improvement (66%).
• Almost three in four (73%) surveyed shoppers say that they want more transparent communication of sustainability characteristics on product packaging and display, while 37% said they would be willing to pay a premium of 11-17% for more sustainable options.

"Both grocery shoppers and senior industry executives seem to recognize the value of sustainability," said Gaurav Pant, chief insights officer of Incisiv and Grocery Doppio. "Grocers have key focus areas and priorities for 2023 and view sustainability as a C-level priority. Meanwhile, more than a third of grocery shoppers say that sustainability is important to them, and that they are willing to pay more for products and practices that mirror their personal values."

"Since Grocery Doppio began tracking the market, we have seen two irrepressible trends month after month," said Charlie Kaplan, chief revenue officer of Wynshop. "Grocers are taking more of the overall digital grocery market from third parties, and curbside pickup continues to gain in popularity with shoppers. Both trends underscore the importance to grocers of improving digital operations in 2023."

[Read more: More than half of U.S. households order groceries online in December]

The scorecard is built around data analysis of 1.7 million shopper orders and survey results from more than 23,000 shoppers and 2,300 U.S. grocery executives. To download it from the Grocery Doppio site, click here.