Ahold Delhaize Sees US Online Grocery Sales Jump 22%
Ahold Delhaize saw quarterly digital sales surge as more American consumers do their grocery-buying online.
The supermarket conglomerate released earnings Wednesday (Feb. 11) showing revenues up 6.1%, driven in part by a 22.8% jump in online grocery sales in the U.S.
The company, whose grocery chains include Stop & Shop, Food Lion and Giant, used its earnings call to tout some of the keys to this growth, such as its in-house “click-and-collect” software system Prism, and its partnerships with DoorDash and Instacart.
“So we talk about online a lot,” said J.P, O’Meara, the company’s head of investor relations. “The teams are so convinced that omnichannel is the name of the game. Those customers are more loyal, store and online connected.”
The company’s success in online sales comes as financially stressed consumers are increasingly turning to digital channels for their grocery buying, as recent research from PYMNTS Intelligence has found.
“Consumers under high financial stress are 6 percentage points more likely to purchase groceries online than those under low stress,” PYMNTS wrote last month. “This pattern does not reflect a general surge in online shopping, but a targeted move toward grocery purchases that offer more visibility into prices, discounts and budgets.”
The research is compiled in the report “The New Checkout: Crimped Consumers Lean Into Online Retail and Digital Wallets,” which underscores that grocery spending is non-negotiable, even as households deal with increasing costs elsewhere.
The research found that consumers experiencing high levels of financial stress spent an average of $109 on their recent trip to the supermarket, versus $95 for lower-stress shoppers. This finding indicates fewer trips and more careful planning, not looser discipline on spending.
“Digital channels amplify this behavior,” PYMNTS added. “Financially stressed shoppers appear to favor online grocery purchases for the control they offer, including easier price comparisons and access to promotions. In-store grocery shopping still plays a role, but the growth momentum is clearly digital for this group.”
Consumer unease was on the minds of analysts during the earnings call, asking management how Ahold Delhaize planned to address declining sentiment, as well as challenges from the likes of Walmart and Amazon.
“Yeah, it’s pretty competitive out there in the U.S,” O’Meara responded. “That’s what also makes this business exciting.”
He argued the company can still compete on its pricing, supply chain and branding offer, while also investing in remodels and new store openings.
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