There are two pieces of eCommerce news that have people talking this week. The first involves a booming U.S. online grocery industry. The second involves a possible mistake by Amazon in tacking on fees for Whole Food deliveries. Let’s take a look.
As reported by Supermarket News, the latest Brick Meets Click/Mercatus Grocery Shopping Survey estimates that U.S. online grocery sales reached nearly $98 billion last year. These sales include those across pickup, delivery, and ship-to-home channels. According to the Brick Meets Click report, more than 70% of U.S. Households, or 93 million, received one or more orders during the year.
Brand Focus Digital reported back in August of 2021 that Amazon was set to charge its customers $9.95 for every time it delivered them an order from Whole Foods Market. Well, Amazon implemented the delivery fee and the initial results are in…Orders have officially “plummeted,” as reported by the New York Post.
One employee referenced in the Post article states that the number of deliveries per hour at the New York flagship store has dropped to 40 from 185 since the fee was introduced on Oct. 25, 2021.
A Whole Foods spokesman, Brian McGuigan, said those numbers were “grossly inaccurate,” but he wouldn’t give specific information on the number of deliveries per hour or say whether deliveries were affected by the new fee.
We’re not surprised by the Brick Meets Click Report. Brand Focus Digital has done much writing over the past year about the rise in U.S. e-grocery sales. For example, see this article from last February. Of course, COVID has helped contribute to this surge in sales, but the pandemic has helped customers treat online grocery shopping as the new norm.
With regards to the decline in Whole Foods deliveries, we said it back in August and we’ll say it again. The fee, and its subsequent disinterest among customers, could serve as an opening for Walmart. Keep in mind that the latter business offers Walmart+ grocery delivery as a free service for all its members. We’ll continue to monitor Amazon’s fee and provide updates where appropriate.
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