DIpil Das
US CPG Sales Tracker: Coresight Research x IRI Analysis
The Coresight Research and IRI monthly US CPG Sales Tracker presents data-driven insights into online sales trends in the US CPG industry—covering the product categories of food & beverage; health & beauty; and general merchandise & homecare. In this report, we present five key insights from the four weeks ended January 23, 2022. 1. Online CPG Growth Remains Steady in the Mid-Teens CPG e-commerce year-over-year growth held steady at 15.5% for the four weeks ended January 23, 2022; growth has remained in the mid-teens since November 2021. Assuming total underlying demand for CPG e-commerce stays roughly level with that of recent months, we are on track to see year-over-year growth rates increase in coming months as the comparatives from one year earlier become easier—as shown in Figure 1, the growth rates from one year earlier fall away in March and April. The two-year stack for total online CPG sales stood at around 88% in December 2021 and around 89% in January 2022.Figure 1. CPG E-Commerce and Total Sales Growth (YoY % Change) [caption id="attachment_142456" align="aligncenter" width="700"]
Historical data have been revised for the latest period Source: IRI E-Market Insights™/Coresight Research [/caption] 2. All Major CPG Categories See Solid Online Sales Growth We break down the online CPG market into three major categories: food & beverage, health & beauty and general merchandise & homecare. The sustained expansion in all three categories underscores the continued appeal of online grocery shopping, even as the sector annualizes the very strong growth from one year earlier. The general merchandise & homecare and food & beverage e-commerce sectors saw minor sequential increases in year-over-year growth compared to the prior period, reaching 18.6% and 7.1%, respectively. Health & beauty saw greater growth acceleration than the other categories—1.2 percentage points—and reached 22.2%.
Figure 2. E-Commerce CPG Sales Growth, by Category Type (YoY % Change) [caption id="attachment_142457" align="aligncenter" width="700"]
Historical data have been revised in the latest period Source: IRI E-Market Insights™/Coresight Research [/caption] 3. Breakdown of Online CPG Sales: Food & Beverage Share Increases The chart below shows the breakdown of online sales by CPG category. Food & beverage’s share of overall online sales increased to 34.3% during the four weeks ended January 23, 2022, mainly driven by the growth of the beverage department. General merchandise & homecare’s share decreased by 2.8 percentage points, to 31.1% of the CPG e-commerce market. Health & beauty’s share decreased by 1.3 percentage points to 34.6%.
Figure 3. CPG E-Commerce: Breakdown of Sales Share by Category (%) [caption id="attachment_142459" align="aligncenter" width="700"]
Source: IRI E-Market Insights™/Coresight Research [/caption]
4. Beverage Outpaces Other Food Departments in Online and Total Sales
The beverage department reported the highest year-over-year online and total sales growth rates, of 17.4% and 8.2%, respectively. Year-over-year growth was driven by increases in sales of sports drinks (up 28.9%), teabags/loose leaf tea (up 23.4%), and milk flavoring/cocoa mixes (up 22.1%).
Figure 4. Food & Beverage Departments: E-Commerce and Total Sales Growth, Four Weeks Ended January 23, 2022 (YoY % Change) [caption id="attachment_142460" align="aligncenter" width="700"]
Source: IRI E-Market Insights™/Coresight Research [/caption]
5. Beauty Leads Online Growth Among Nonfood Departments
The beauty department saw the highest year-over-year online sales growth among nonfood departments, reaching 66.4% year-over-year growth for the four weeks ended January 23, 2022—although the department saw much lower total sales growth of only 5.0%. This suggests that an increasing portion of the beauty market is moving online. Growth was driven by hairstyling gel (up 31.8%), hair accessories (up 31.6%) and razor blades (up 29.1%).
Figure 5. Nonfood Departments: E-Commerce and Total Sales Growth, Four Weeks Ended January 23, 2022 (YoY and Change) [caption id="attachment_142461" align="aligncenter" width="700"]
Source: IRI E-Market Insights™/Coresight Research [/caption]
What We Think
Assuming consumer demand for online grocery stays roughly level with that seen in recent months, we are on track to see year-over-year growth rates increase in coming months as the comparatives from one year earlier become easier. Such an acceleration in the recorded pace of expansion would not, however, reflect a renewed jump in dollar sales. Consumers have retained the online grocery shopping habit, supported by increased capacity on the supply side, including newer services such as quick commerce (rapid delivery) and retail-alternative options such as meal kits, and we expect a meaningful acceleration in year-over-year online sales growth for calendar 2022.IRI Disclaimer: The information contained herein is based in part on data reported by the IRI E-Market Insights™ solution and as interpreted solely by Coresight Research. The information is believed to be reliable at the time supplied by IRI but is neither all-inclusive nor guaranteed by IRI or Coresight Research, Inc. Without limiting the generality of the foregoing, specific data points may vary considerably from other information sources. Any opinions expressed herein reflect the judgement of Coresight Research, Inc. and are subject to change. IRI disclaims liability of any kind arising from the use of this information.