Online shopping and home delivery hold the potential to reduce greenhouse gas emissions by eliminating some shopping trips. In reality, however, they may have the opposite effect, resulting in more driving and more pollution.
That’s because people redeploy the time and energy they save on, say, grocery shopping to make more trips to buy other stuff, according to Arizona State University graduate student Shasha Cao and Arizona State’s Pei-yu Chen, Tian Lu, and Raghu Santanam.
“It’s clear from the data that US families were using home delivery, in some cases habitually, and taking advantage of savings in energy and time,” Cao says. “But the question is, how did these services impact shopping habits?”
The environmental impact of routine shopping is enormous. According to a 2015 US Department of Agriculture survey, 88 percent of households traveled an average of 4 miles to buy groceries from local stores. Weekly grocery runs could add up to more than 42 billion miles in round trips every year—spewing more than 17 million metric tons of CO2 into the atmosphere, according to a calculation by the US Environmental Protection Agency.
The researchers analyzed the behavior of thousands of American families from the beginning of 2016 through the end of 2019 by tapping into NielsenIQ Consumer Panel Data at Chicago Booth’s Kilts Center for Marketing. The data covered the four years before the COVID pandemic dramatically increased Americans’ use of home delivery and online shopping. The researchers haven’t been able to ascertain whether that spike, due to lockdowns that significantly curtailed in-person shopping, permanently reduced shopping forays.
Analyzing changes in shopping habits among households that started using grocery delivery services, the researchers find that about 14 percent of their sample of more than 90,000 households took advantage of delivery offered by local retailers or other services such as Instacart. Of those households, more than 1,500 of them both used these services for the first time and went on to have groceries delivered routinely—three times or more in 16 weeks.
What are the mental connections we’re making between various expenses, and how can understanding them help us make better decisions?
Are You Shopping Irrationally?
Prices rise more slowly online than in traditional stores, which could affect overall inflation levels.
More Online Shopping Could Mean Lower InflationFamilies using home-delivery services bought the bulk of their groceries online, according to the data. But the same households also increased the number of shopping trips they made to a variety of brick-and-mortar stores, the researchers find: in-person grocery shopping rose almost 9 percent among families using Instacart and similar services.
What seemed to happen was a “fragmentation” of shopping habits, Cao says. “People were going online and using Instacart and other platforms to have their shopping delivered, but they weren’t substituting this for a trip to the store as much as we might think,” she says. “We find that they were still heading out to buy other items, especially those less essential household ones.”
As a result, these households spent 16 percent more on groceries every week, Cao and her colleagues find. Although some of that was for home-delivered goods, households still increased average weekly spending at grocery stores by 5 percent.
The researchers find that when people used home-delivery services in combination with in-person shopping trips, they tended to seek out a broader range of stores and household products. Families using home-delivery services were about 30 percent more likely to subsequently check out new physical stores compared with those that weren’t getting groceries delivered.
The diversification of shopping habits—the urge to try something new and different—could come down to exposure to variety and information that comes with online shopping and home delivery, the researchers explain.
“Having our groceries delivered to the door saves us time and effort, which is great,” Cao says. “Households can then redirect their attention to unplanned needs and items.” In addition, she says, “sites such as Instacart offer consumers an increased selection, an ease of searching, and detailed product information. This in turn could be whetting customers’ appetite to try out new products and to simply buy more—a case of shopping begetting shopping.”
And then there is the social dimension of shopping, Cao observes. “Home-delivery services don’t substitute for the pleasure and enjoyment we get from jumping in the car and heading to the store to browse and interact with other people,” she says.
This positive social dimension isn’t enough to offset the environmental concerns, however, particularly among policymakers seeking to reduce greenhouse gas emissions.
Shasha Cao, Pei-yu Chen, Tian Lu, and Raghu Santanam, “The Impact of Home Delivery Services on Households’ Shopping Behaviors and Environment: A Comprehensive Empirical Investigation,” Working paper, March 2024.
But the pandemic-era moratorium may also have led some borrowers to take on even more debt.
Pausing Student-Loan Payments Boosted the Economy
Research examines how gun ownership would change in response to various restrictions.
If You Want Gun Control, Start with Market Research
Research supports a common policy response to an economic decline.
Does Extending Jobless Benefits Help in a Recession?Your Privacy
We want to demonstrate our commitment to your privacy. Please review Chicago Booth's privacy notice, which provides information explaining how and why we collect particular information when you visit our website.