Brick Meets Click is projecting online grocery shares by 2023 will be 23% in the New York metro area, 13.5% in Chicago and 8.6% in Atlanta, based on a new framework the company said it has developed for identifying and anticipating the growth potential of online grocery sales in specific markets.
The current figures for online grocery sales are 5% in New York metro, 3.8% in Chicago and 2.3% in Atlanta, the company said.
Brick Meets Click issued a white paper Wednesday to provide guidance to companies that want to “leverage the convergence of digital and physical retail to enhance their growth,” Bill Bishop, chief architect for the Barrington, Ill-based retail consultancy, said.
Entitled, “Understanding market-level online grocery potential,” the study applies the new framework to the three markets by combining specific market characteristics with shopper input extrapolated from previous Brick Meets Click research on the behaviors and attitudes of more than 23,000 online grocery shoppers, which the company said it has accumulated in three years of research in five U.S. markets.
“Online grocery is going to be part of the competitive landscape from now on,” the study says. “Better understanding the dynamics at work in your market will help you compete, whether or not you choose to make your own online offering.”
According to Bishop, “What retailers need to know is, what drives the growth trajectory for a given market is what’s actually happening in that market. We’ve identified the key growth factors and developed a way to capture the interplay among them.”
Bishop said two types of information are essential for using the framework to understand the growth potential of online grocery: an inventory of key market characteristics, including availability of online grocery options, the diversity of features offered and affordability; plus insights into how shoppers in that market are reacting to and using the online offerings that exist.

“Retailers will benefit by having a better idea of how fast this type of online grocery shopping is likely to grow in their market so they can develop both offensive and defensive business strategies,” he explained. “National averages won’t be much help for planning purposes because they don’t give management the detail that’s needed. That’s where this thinking and framework can really help.”
According to the study, “The share of online grocery spending varies significantly from market to market, driven by the interplay between shoppers and the services available in those markets. If food retailers can better understand how fast online grocery shopping is likely to grow in their market, they can make better strategic decisions about the best time to get into the business.”
While many food retailers are responding to the growth of online shopping, “important decisions are being made based on beliefs and assumptions as opposed to what their customers want and will pay for,” the study says.
At minimum, it suggests retailers do research to determine customer readiness for buying groceries online; what options they currently use; the strengths and vulnerabilities of online options; the upside sales potential for store pickups; and the impact on “share of wallet.”