Q3 was a big deal for online grocery. In July, sales reached $10B, August grew to $11.2B, and September hit $12.5B. That’s 11.6% growth from August to September and 31% growth year over year. Stores are reportedly experiencing more monthly active users, more orders per user, and larger baskets, signaling a long-term trend not just a spike.  The growth is driven by improved delivery results by the largest retailers. 

Online grocery keeps setting these sales records because coverage and speed crossed a threshold. Walmart says delivery in 3 hours or less now covers about 93% of U.S. households and set a target of 95% by year end. When a household trusts a three hour window, a top-up shop that used to force a trip can stay online. That adds orders per month for the same user. 

Competition also is making online grocery even easier. Amazon made same-day perishable delivery free for Prime orders over $25 in most cities and is expanding from 1,000+ areas to about 2,300 by year end. The Amazon cart can now mix produce, dairy, and pantry with the rest of the assortment and arrive the same day. As two national networks compete, fees are clearer, windows are tighter, and substitution quality improves.

Who is driving the rise? Brick Meets Click reports an increase in shoppers 60+, plus a wave of lapsed users who last bought online a few months ago and came back in September. Online captured 19% of weekly grocery spending in September, up 400 bps from last year. That is the second-highest level on record after May 2020.