Online Grocery Market to Grow with a CAGR of 26.91% Globally through 2028
According
to TechSci Research report, “Global Online Grocery Market - Industry Size,
Share, Trends, Competition Forecast & Opportunities, 2028”, the
Global Online Grocery Market stood at
USD 50.31 billion in 2022 and is anticipated to grow with a CAGR 26.91% in the
forecast period, 2024-2028. The Global Online Grocery Market is a rapidly
growing sector driven by changing consumer behaviors and technological
advancements. Fueled by the convenience of e-commerce, the market expanded
significantly, especially during the COVID-19 pandemic, as consumers sought
safer shopping alternatives. Key drivers include changing lifestyles,
omnichannel strategies, sustainability focus, and the integration of artificial
intelligence. However, challenges such as supply chain complexities,
profitability concerns, and regulatory issues persist. With an emphasis on
innovation, personalized experiences, and global expansion, the online grocery
market continues to reshape the retail landscape, offering consumers efficient
and flexible ways to meet their daily food and beverage needs.
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The COVID-19
pandemic served as a powerful accelerator for the online grocery market. Concerns
about safety and social distancing measures prompted a significant surge in
online shopping across various sectors, with groceries being a fundamental
necessity. Consumers, adhering to lockdowns and health protocols, turned to
online platforms for their essential needs, further ingraining the habit of
digital grocery shopping.
Omnichannel
strategies have played a pivotal role in the growth of the online grocery
market. Retailers, both traditional and digital, are increasingly adopting
omnichannel approaches to provide a seamless shopping experience. This involves
integrating online platforms with brick-and-mortar stores, enabling consumers
to transition effortlessly between various channels. For instance, a customer
can order groceries online and choose to pick them up at a physical store or
have them delivered to their doorstep. This integration not only enhances
customer convenience but also allows retailers to maximize their reach and
cater to a diverse consumer base.
Sustainability
has emerged as a significant trend in the global online grocery market.
Consumers are becoming more conscious of the environmental impact of their
choices, and this awareness extends to their grocery shopping habits. Online
grocery platforms are responding by adopting eco-friendly practices, such as
reducing packaging waste and promoting locally sourced and sustainably produced
products. This trend aligns with the broader global movement towards
environmentally responsible consumption and reflects a growing expectation
among consumers for businesses to demonstrate social and environmental
responsibility.
Artificial
Intelligence (AI) is another transformative element in the online grocery
market. AI and machine learning technologies are being leveraged to enhance the
overall shopping experience through personalization. Algorithms analyze user
behavior, preferences, and past purchases to provide tailored product
recommendations, discounts, and promotions. This not only improves customer
satisfaction but also assists online grocery retailers in optimizing their
inventory management and supply chain operations. Real-time data analytics
enable a more accurate prediction of demand, helping to minimize wastage and
ensure the availability of popular products.
Profitability
and pricing strategies pose challenges for online grocery retailers. The
industry operates on thin profit margins, and intense competition often leads
to price wars. Balancing competitive pricing with the cost of efficient
logistics and delivery services is a delicate task. Additionally, consumer
price sensitivity and the prevalence of promotions and discounts further
complicate the path to profitability. Successfully navigating these challenges
requires a strategic approach, possibly involving economies of scale,
operational efficiency enhancements, and innovative pricing models.
Digital
inclusion remains a concern in the global online grocery market. While digital
technologies have become pervasive, disparities in internet access and device
availability persist across different regions and demographic groups. Bridging
the digital divide is crucial for ensuring that a broad spectrum of consumers
can benefit from the convenience of online grocery shopping. User-friendly
interfaces, educational initiatives, and partnerships with telecommunications
providers are some strategies employed to address digital inclusion challenges.
Regulatory
landscapes vary across countries, posing another layer of complexity for online
grocery retailers. Compliance with diverse regulations related to food safety,
data privacy, and e-commerce requires significant attention. Adapting business
operations to meet these regulatory requirements, especially when expanding
into new markets, demands a nuanced understanding of local laws and consumer
expectations.
The global online
grocery market is segmented into type, platform, regional distribution, and
company.
Based on platform,
the market is segmented into mobile applications and desktop website.
The mobile
application segment is a burgeoning force in the online grocery market,
witnessing substantial growth. As consumers increasingly prioritize
convenience, mobile apps have become instrumental in transforming the online
grocery shopping experience. These apps offer a user-friendly interface,
allowing customers to browse, select, and order groceries effortlessly.
Features such as personalized recommendations, digital menus, and seamless
payment options enhance user engagement. With the prevalence of smartphones and
the surge in on-the-go lifestyles, the mobile application segment is reshaping
how consumers interact with online grocery platforms, contributing
significantly to the overall dynamism and expansion of the market.
Major companies
operating in Global Online Grocery Market are:
- Aeon Co., Ltd.
- Alibaba.com.
- Amazon.com, Inc.
- Blink Commerce
Private Limited
- JD.com, Inc.
- Natures Basket
Limited.
- Reliance Retail.
- Target Brands,
Inc.
- Tesco.com
- The Kroger Co.
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“The
Global Online Grocery Market is thriving, driven by evolving consumer
preferences and technological advancements. Accelerated by the COVID-19
pandemic, online grocery shopping offers convenience and safety. Key trends
include omnichannel strategies, sustainability practices, and artificial
intelligence integration for personalized experiences. Challenges encompass
supply chain intricacies, profitability, and regulatory compliance. Despite
obstacles, the industry is expanding in emerging markets. With a focus on
innovation and seamless customer experiences, the online grocery market
continues to revolutionize how consumers access and purchase food, shaping a
dynamic and competitive landscape.” said Mr. Karan Chechi, Research Director
with TechSci Research, a research-based management consulting firm.
“Online Grocery Market –
Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By
Type (Packaged Food & Beverages, Personal Care, Household Products, Fruits
& Vegetables, Others (Pet Care, Baby Care, etc.)), By Platform (Mobile
Application, Desktop Website), By Region, By Competition, 2018-2028”,
has evaluated the future growth potential of global online grocery market and provides
statistics & information on market size, structure and future market
growth. The report intends to provide cutting-edge market intelligence and help
decision makers take sound investment decisions. Besides, the report also
identifies and analyzes the emerging trends along with essential drivers,
challenges, and opportunities in Global Online Grocery Market.
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