Grocery Roundup: Brick-And-Mortar Sales Growth Slows As Meal Kits Gain Ground

groceries in cart

As newly vaccinated consumers return to restaurants for dine-in experiences, grocery sales remain elevated, but growth is slowing. In a news release on Monday (May 3), Publix announced that sales for the first quarter of 2021 totaled $11.7 billion, a 3.9 percent increase year over year, while in the final quarter of 2020, the company’s sales totaled $11.2 billion, a 14.8 percent year over year increase. Similarly, Ingles Markets sales were up 3.4 percent year over year for the quarter, the company announced Wednesday (May 5), down from 10.4 percent growth the previous quarter.

Additionally, Weis Markets sales were up 2.1 percent year over year in Q1 2021, while in Q4 2020 the chain’s sales were up 13.7 percent. Still, though sales were up only slightly year over year in the first quarter, they were well above 2019 levels.

“The World Health Organization declared the novel coronavirus (COVID-19) a pandemic on March 11, 2020 which resulted in restaurant, business and school closings while other companies transitioned to working remotely. The result was a record surge in demand for food retailers,” Jonathan H. Weis, chairman, president and CEO of Weis Markets, summarized in a statement. “Our first quarter 2021 results remained significantly elevated in absolute terms and were in line with expectations with sales up 14.8 percent and net income up 69.6 percent compared to the pre-pandemic levels in first quarter 2019, which is a more appropriate baseline for comparison.”

HelloFresh Membership Surges

Perhaps some of the slowed growth that these brick-and-mortar supermarkets are experiencing comes from consumers’ turn toward online food purchasing channels. Meal kit subscription and delivery service HelloFresh reported Wednesday (May 4) that its number of active customers for Q1 2021 was up to 7.28 million, a 74.2 percent year-over-year increase.

It might be tempting to attribute this high figure to the fact that most of Q1 2020 occurred before pandemic lockdowns. However, this growth basically keeps pace with the company’s Q4 2020 growth, with the number of active customers increasing 78 percent year over year to 5.3 million.

The Berlin-based company is growing more quickly in its international markets than in the United States. In the U.S., the number of active customers was up 39.8 percent, compared to 133.1 percent growth internationally. Additionally, the number of meals ordered overall grew 114.8 percent to 239.1 million, with 85.8 percent growth in the US and 150.2 percent growth internationally.

“2021 has set off to a strong start. Our teams have been working hard to de-bottleneck the capacity constraints we were experiencing over the majority of 2020, especially in our US market,” Dominik Richter, CEO and co-founder of HelloFresh, said in a statement. “As a result, we’ve welcomed more customers than ever to HelloFresh. As consumers around the world have been adapting to new habits, like buying groceries online, they’ve also discovered the many advantages of our full meal solutions over traditional grocery shopping … I am confident that we will benefit disproportionately from the shift to increased online grocery penetration.”

Target Incentivizes In-Store Vaccinations With Coupons

Target announced in a blog post on Tuesday (May 4) that both customers and employees can receive a $5 Target coupon when they receive their vaccinations at in-Target CVS locations.

“All U.S. adults are now eligible to get their COVID-19 vaccine — and now it’s even easier for you to get yours,” reads the post. “We’re offering vaccine appointments at nearly all CVS at Target locations. And bonus: we’re offering guests and team members a $5 Target coupon when they receive a CVS at Target-administered COVID-19 vaccination.”

The posted added that these coupons are redeemable for in-store purchases. While framing this offer as an incentive for vaccine-hesitant consumers to get the jab, much the same way Krispy Kreme incentivized vaccinations with free donuts, Target is also taking the opportunity to use the vaccine rollout to bring consumers into Target and to encourage them to make purchases while they are in the store.

Walmart Partners With Netflix Series For Branded Grocery Content

Walmart, a leader in the branded content space known for creating shoppable videos that guide consumers to its grocery offerings, is partnering with the creators of Netflix’s Waffles + Mochi video series in which Michelle Obama and a team of puppets cook recipes from around the world together. In a news release Thursday (May 6), Walmart announced its Hidden World of Waffles + Mochi series, in which characters from the show lead activities using Walmart’s products. These videos, targeted at families with young children, feature “20 different activities centered around 10 ingredients from the series, from tomatoes and mushrooms to eggs and rice.”

“I’ve long said that supporting parents and helping our kids build healthy habits isn’t just a job for nonprofits or governments – the private sector has a critical role to play as well,” Michelle Obama said in a statement included in the release. “That’s why I am proud to see Walmart continuing to lead the way with The Hidden World of Waffles + Mochi, a wonderful food adventure that not only educates families on how to make quick and easy meals at home, but also teaches kids that they can give back to their community at any age.”

Read More On Retail: