Ecommerce Takes a Bigger Bite Out of UK Grocery Sales - eMarketer

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Ecommerce Takes a Bigger Bite Out of UK Grocery Sales

Higher-income households spend even more online on groceries

September 6, 2013

The UK has been a worldwide leader in digital sales of fast moving consumer goods (FMCG), and the grocery sector is no exception. Ecommerce is the fastest-growing channel of the UK grocery market, according to data from Kantar Worldpanel, with sales in May 2013 up 19% over the same period last year. Discounters grew by 12% that month, while supermarkets made a 2% gain.

UK Grocery Sales Growth, by Channel, May 2013 (% change vs. same period of prior year)

Still, the supermarket is where nearly two-thirds of grocery sales take place, even as ecommerce’s share has risen substantially—up to 5.1% this year, from 4.5% in 2012. That rise marks among the biggest growth spurts for grocery ecommerce sales in the country since 2003.

Ecommerce Share of UK Grocery Spending, 2003-2013 (% of total)

Among UK households earning more than £60,000 ($95,238), the percentage of online grocery sales is even higher—reaching 10%, according to Kantar’s study.

And there’s reason to think online grocery receipts will keep rising. Grocery sales totals per ecommerce checkout tend to be for higher-value amounts. The web accounts for 12% of sales made for baskets over £60 ($95) vs. only 1% of baskets under that amount. While most grocery sales in the UK are made in smaller basket shopping trips, as more consumers are convinced to buy groceries online, they are likely to do bigger shops and drive up total sales value relatively quickly. But that scenario depends considerably on retailers’ success in getting more UK consumers to go online to shop for their next few meals.

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