Online bakery sales rise faster than overall grocery

Online sales of ambient bakery goods rose 5% in 2017 – just ahead of the increase in overall online grocery sales – according to a new study.

Total online grocery sales increased 4.6% to £6.6bn, a third faster than the 3.4% rise in in-store sales, according to Nielsen data.

But online remains a tiny part of the grocery market, accounting for 6.4% of overall grocery sales, up just 0.1% from the previous year. Bakery is performing behind the overall grocery market, with online sales accounting for 4.7% of total ambient bakery.

Nielsen’s analytics business partner Aylin Ceylan described the 0.1% increase in online grocery sales as “a rather pedestrian rate”.

“Despite the hype and attention given to online and its ability to change the way people shop, the reality seems rather different,” she added.

“Many will be surprised it’s not faster, but online shopping in grocery, unlike many other sectors, is much more a complementary option to stores not an ‘instead of’ option.”

Online shopping is dominated by ‘the big shop’ and weekly trips, which account for 82% of online shops compared to 44% of in-store trips (see graphic). These bigger shops are the reason pet care, frozen foods, baby/toddler and household/cleaning tend to make up a much bigger proportion of online baskets than in-store ones.

“In other words, the regular smaller ‘top-up’ shops account for just 18% of online trips compared to 57% for in-store,” said Ceylan.

She added that the issue with growing online shopping was frequency, as consumers bought groceries online less than once a month compared to nearly 21 times a month in-store.

Ceylan suggested that growing online’s market share would be down to convenience.

She added that factors including the rise of voice assistants from Google and Apple, the Dash button from Amazon, and the expansion of supermarket click & collect could make 2018 a “seismic year” for online grocery.

“These are all making it easier for shoppers, while online meal-kit and ‘box’ subscriptions, such as Hello Fresh and Graze, are offering new purchasing opportunities,” she said.

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