Online Grocery Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Product Type (Fresh Produce, Breakfast & Dairy, Snacks & Beverages, Staples & Cooking Essentials, Others), By Delivery Type (Instant Delivery, Schedule Delivery), By Region, By Competition, 2020-2030F

Market Overview

The global Online Grocery Market was valued at USD 54.51 Billion in 2024 and is expected to reach USD 173.67 Billion by 2030 with a CAGR of 21.36% during the forecast period. The shift in consumer shopping preferences due to the pandemic, coupled with the continued expansion of the e-commerce industry, is expected to drive market growth during the forecast period. The availability of various online payment options and the assurance of contactless delivery for ordered groceries are also anticipated to contribute significantly to the market's growth. A recent survey revealed that 75 percent of online grocery shoppers have seen an increase in unplanned purchases in the last six months. Additionally, 53 percent of consumers now place over five orders a month on quick commerce platforms, with nearly 67 percent of buyers spending more than USD 4.80 per order on these instant delivery services. 2024 has marked a significant boom for quick commerce in India, with 15-minute delivery services taking center stage. Q-commerce giants like Blinkit, Swiggy Instamart, and Zepto have expanded their product offerings to meet the evolving needs of consumers. These platforms now cater to a wider audience by offering not just groceries, but also electronics, beauty products, and festive gift hampers, all delivered within minutes. The combined revenue of these quick commerce leaders exceeded USD 1 billion, with the industry experiencing an impressive 280 percent growth over the past two years. While some platforms deliver within 15-20 minutes, others have raised the bar by fulfilling orders in just 8-10 minutes, reflecting the shift in Indian consumers' purchasing habits.

Market Drivers

Convenience and Time-Saving

One of the most significant drivers of the global online grocery market is the convenience it offers to consumers. In today’s fast-paced world, people are increasingly prioritizing convenience, and online grocery shopping provides a hassle-free experience that traditional shopping cannot match. Consumers can shop for groceries at any time, from the comfort of their homes, without the need to travel to physical stores. This is especially appealing for those with busy schedules, such as working professionals, parents, or elderly people who find it difficult to spend time shopping in-store. Online platforms allow users to browse and order products easily, often with features like saved shopping lists, personalized recommendations, and subscription services that further enhance convenience. Additionally, online grocery services typically offer various delivery options, such as same-day or next-day delivery, making it even more attractive to consumers who are looking to save time. For urban consumers living in congested cities, avoiding the need to navigate traffic and wait in long lines at supermarkets is a considerable benefit. The ability to compare prices and shop across multiple stores in a single platform also adds value, as customers can access a wide range of products and take advantage of special deals or discounts. In November 2024, 77.8 million households purchased groceries online, surpassing the previous record set in April 2020, during the first full month of the COVID-19 pandemic, which saw 76.7 million households. Additionally, 72% of monthly active users (MAUs) relied on a single fulfillment method. Customer satisfaction with online grocery services improved in November, as the overall repeat intent rate reached 65.2%, marking the highest score in the last four years and the third highest since the start of the pandemic in March 2020.Meanwhile, Ship-to-Home sales, the smallest segment by total sales, saw a 30% increase, growing to USD 1.7 billion from USD 1.3 billion in November 2023.

Technological Advancements

The continuous evolution of technology has played a crucial role in driving the growth of the global online grocery market. The integration of artificial intelligence (AI), machine learning, and data analytics has improved the online grocery shopping experience in numerous ways. AI-driven algorithms enable online platforms to offer personalized recommendations, helping consumers discover products they might not have otherwise considered. These systems track users' browsing habits, purchasing history, and preferences to suggest items that align with their needs, ultimately boosting sales and customer satisfaction. Moreover, real-time inventory management powered by AI ensures that the available stock is always up-to-date, reducing the risk of customers encountering out-of-stock products. Technological innovations in logistics and supply chain management have also enhanced the efficiency of grocery delivery systems. With advancements in route optimization algorithms, companies can now deliver groceries faster, reducing delivery costs and improving customer satisfaction. Moreover, automation in warehouses has allowed for quicker product sorting and packaging, further speeding up the fulfillment process. The rise of mobile apps has made online grocery shopping more accessible, with smartphones becoming the primary tool for purchasing groceries. Apps are designed to be user-friendly and intuitive, which has made grocery shopping more accessible to people of all ages, including those who may not have been accustomed to shopping online. As mobile technology continues to improve and more regions gain internet access, the adoption of online grocery shopping is likely to increase globally.

Changing Consumer Preferences

Changing consumer preferences, particularly the shift toward health-conscious and sustainable shopping habits, are major drivers of the online grocery market. As consumers become more aware of the benefits of healthy eating, they are increasingly seeking fresh, organic, and natural products. This shift has led to the growth of online grocery platforms that specialize in such items. Consumers are also becoming more selective about sourcing their groceries, opting for organic, eco-friendly, or locally-sourced products, which online grocery stores are well-equipped to cater to. Moreover, the desire for convenience and quality food delivery has encouraged the adoption of online grocery shopping. People are increasingly expecting faster and more reliable services, such as same-day delivery, and online platforms are responding to this demand by offering better customer experiences. As health-conscious consumers demand more transparency in product sourcing, online platforms often provide detailed product information, certifications, and reviews, helping shoppers make informed decisions. The growing trend of sustainability has also pushed online grocery services to adopt more eco-friendly packaging and offer eco-conscious product choices. Many platforms now offer options like reusable packaging, biodegradable bags, or a zero-waste shopping experience, in response to the increasing importance consumers place on environmental responsibility. 

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Key Market Challenges

Logistics and Delivery Challenges

One of the primary challenges faced by the global online grocery market is the logistics and delivery complexities associated with delivering fresh and perishable items. Grocery items, particularly fresh produce, dairy, meat, and frozen goods, have specific requirements in terms of storage, handling, and transportation. Maintaining the integrity of these items throughout the supply chain, from warehouse to doorstep, can be difficult and expensive. The first challenge lies in ensuring that products remain fresh during transit. Unlike other e-commerce products, which have longer shelf lives, groceries need to be delivered quickly to ensure quality and minimize spoilage. This requires specialized refrigeration and temperature-controlled environments, which increase the operational cost and logistical complexity. Additionally, online grocery companies must navigate tight delivery windows, as consumers expect timely delivery often within a few hours or the same day.

Meeting this demand involves substantial investment in warehouses, delivery vehicles, and personnel. In urban areas, navigating congested traffic and delivering to high-rise buildings or apartments can further complicate logistics, resulting in delayed or missed deliveries. This challenge is compounded in rural areas where transportation networks may be less developed, making it difficult to reach customers in a timely manner. Moreover, the delivery cost is another significant challenge. With consumers seeking free or low-cost delivery, online grocery stores must balance the expense of maintaining a fast and efficient supply chain with profitability. Many players in the market have adopted models such as subscription services or minimum purchase requirements to offset the costs of delivery, but these strategies may not always be sufficient to cover the rising costs of logistics, especially with volatile fuel prices and the growing demand for faster deliveries.

Supply Chain Disruptions and Inventory Management

Supply chain disruptions are a major challenge for the global online grocery market. The highly perishable nature of grocery products, combined with demand fluctuations, makes inventory management a complex task. A well-functioning supply chain is critical for meeting consumer demand, maintaining product availability, and ensuring customer satisfaction. However, global events like the COVID-19 pandemic, extreme weather conditions, labor shortages, or geopolitical tensions can severely disrupt supply chains, causing shortages, delays, and inventory mismanagement. For instance, during the COVID-19 pandemic, online grocery services experienced unprecedented demand, which led to supply chain breakdowns. This situation exposed the vulnerability of relying heavily on just-in-time inventory systems, which can be easily disrupted when external factors like global lockdowns or transportation bottlenecks arise. During these disruptions, grocery platforms struggled with sourcing and replenishing stock, particularly for high-demand items like toilet paper, sanitizers, and fresh produce. The problem is further compounded by the challenge of forecasting demand accurately. Unlike other e-commerce sectors, where demand for products can be more predictable, grocery shopping patterns are often influenced by various factors such as seasonality, local events, and weather conditions. The inability to forecast demand precisely leads to either overstocking or stockouts, both of which are detrimental to customer satisfaction. Overstocking leads to wastage, especially for perishable goods, while stockouts result in lost sales and customer dissatisfaction.

Key Market Trends

Mobile and App-Based Shopping

One of the most significant trends in the global online grocery market is the shift towards mobile and app-based shopping. The increasing use of smartphones and mobile internet has made shopping for groceries more convenient and accessible than ever before. Consumers are increasingly using mobile apps to order groceries, as it provides a seamless shopping experience, allowing them to shop anytime, anywhere. Mobile apps offer features that enhance user convenience, such as saved shopping lists, personalized product recommendations, and easy payment options. Many platforms also provide push notifications to alert users about discounts, deals, or order updates, keeping them engaged. Additionally, mobile apps often integrate AI to analyze shopping patterns and suggest relevant products, improving the shopping experience. As smartphone penetration continues to rise globally, especially in emerging markets, mobile grocery shopping is expected to grow even further. The ability to shop on the go, manage orders efficiently, and receive products at home with delivery tracking is driving the popularity of mobile-based grocery platforms. For retailers, having a mobile-friendly platform is essential to capturing the growing base of mobile-first consumers and staying competitive in the market.

Personalization and AI-Driven Recommendations

Personalization, powered by artificial intelligence (AI), is another major trend transforming the online grocery market. Consumers increasingly expect tailored shopping experiences, and grocery retailers are leveraging AI to deliver personalized product recommendations, promotions, and even pricing strategies. AI uses data such as past purchase behavior, browsing history, and preferences to recommend products that consumers are more likely to buy. This creates a more engaging shopping experience by highlighting items that align with customer needs, which in turn boosts conversion rates and sales. AI also enables dynamic pricing, where product prices can fluctuate based on demand, inventory levels, or market conditions, optimizing both customer satisfaction and profit margins. Personalization has become essential to maintaining customer loyalty in a competitive market. Online grocery retailers that implement AI-driven personalization can better anticipate customer needs and deliver a superior shopping experience, which enhances customer retention.

Sustainability and Eco-Friendly Practices

Sustainability is increasingly shaping the global online grocery market, with both consumers and companies prioritizing environmentally friendly practices. Growing awareness about climate change and waste management has led consumers to demand greener shopping options, including eco-friendly packaging and sustainably sourced products. Retailers are responding by adopting biodegradable, recyclable, or reusable packaging solutions to reduce waste. Many online grocery platforms also offer organic, locally sourced, or ethically produced products, aligning with the preferences of environmentally conscious consumers. Additionally, companies are adopting greener logistics practices, such as electric delivery vehicles or optimized routes to minimize carbon footprints. Sustainability is no longer just a trend; it's becoming a core value for many consumers. Companies that embrace eco-friendly practices not only appeal to environmentally conscious shoppers but also strengthen their brand reputation and competitiveness in the evolving market.

Segmental Insights

Product Type Insights

The staples and cooking essentials segment has emerged as the largest revenue-generating category in the global online grocery market. This segment includes essential food items such as rice, flour, oil, spices, canned goods, pulses, and other pantry staples. These products are in constant demand, as they form the foundation of daily meals for households around the world. The popularity of this segment can be attributed to several factors. First, staples and cooking essentials are frequently purchased, with consumers needing to restock these items regularly, making them an ideal fit for online grocery shopping. Additionally, as e-commerce platforms offer the convenience of home delivery, consumers are more inclined to purchase these frequently-used goods online to save time. Furthermore, the pandemic played a significant role in boosting the demand for staples, as consumers shifted to online shopping to avoid in-store visits. The availability of bulk purchasing options and subscription services for these items also contributed to the growth of this segment. As the online grocery market continues to grow, the staples and cooking essentials segment is expected to maintain its dominance due to the essential nature of these products, their frequent consumption, and the ongoing trend of convenience-driven shopping.

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Regional Insights

North America currently lead the global online grocery market, driven by several key factors. The region has a high level of internet penetration, widespread use of smartphones, and well-established digital payment systems, all of which make online grocery shopping more accessible and convenient. Consumer behavior in North America has shifted significantly, with a growing preference for the convenience of online shopping, especially for essential products like groceries. The COVID-19 pandemic further accelerated this trend, as consumers turned to e-commerce for safety, social distancing, and ease of access to daily necessities. Major online grocery platforms in North America, such as Walmart, Amazon Fresh, and Instacart, have expanded their reach by offering a wide range of products, fast delivery options, and subscription-based services. These platforms have also focused on enhancing the customer experience by integrating advanced technologies like artificial intelligence for personalized recommendations and inventory management. Additionally, North American consumers are increasingly prioritizing sustainability, leading retailers to offer eco-friendly packaging and locally sourced products. The demand for organic and healthy food options is also on the rise, further boosting the growth of the online grocery market. With continuous advancements in logistics and technology, North America is expected to maintain its leadership in the online grocery sector.

Recent Developments

• In 2024, Instacart, a North America's online grocery delivery platform, has introduced a new Supplemental Nutrition Assistance Program (SNAP) eligibility screener on its EBT SNAP information page. Powered by Advocatia Solutions, Inc., the tool allows individuals across the country to quickly and anonymously check their potential eligibility for SNAP benefits in under 60 seconds. It also provides easy access to relevant state resources to help streamline the enrollment process.
• In 2024, Flipkart, an e-commerce marketplace, has opened a new grocery fulfillment center in Hubli, Karnataka, as part of its commitment to providing next-day grocery deliveries. Based on local consumer insights, the new center will offer a curated selection of over 6,000 products, including popular regional brands such as Nandini, Naga, and Vijay, alongside a variety of branded grocery items to meet the diverse tastes of consumers in the area, according to Flipkart.
• In 2025, in India, Aap Ka Bazar, the online grocery store, unveiled its newly launched website and mobile apps, designed to make grocery shopping simpler and more convenient than ever before. With the new website and apps, Aap Ka Bazar aims to offer a hassle-free shopping experience. The platform features a wide selection of products, including fresh produce, pantry staples, household essentials, and more. Customers can easily browse the extensive catalog and add items to their cart with just a few clicks, thanks to the intuitive interface.
• In 2024, Deliverect, a global food tech SaaS company, has announced the expansion of its successful restaurant order and delivery solution to the grocery and convenience sector. Deliverect Retail digitalizes the entire grocery process, allowing retailers to manage all orders and catalogs in one central platform, track real-time sales and performance, and access data from third-party delivery services. Additionally, the new Quest App by Deliverect enhances the customer experience by halving the time needed to pick and pack orders.

Key Market Players

• Target Corporation
• The Kroger Co.
• J Sainsbury plc.
• Amazon.com, Inc.
• Rakuten Group, Inc.
• Albertsons Companies, Inc.
• Woolworths Group Limited
• Reliance Retail Limited
• Walmart Inc.
• Tesco PLC

Report Scope:

In this report, the global Online Grocery Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

•  Online Grocery Market, By Product Type:

o   Fresh Produce

o   Breakfast & Dairy

o   Snacks & Beverages

o   Staples & Cooking Essentials

o   Others         

•         Online Grocery Market, By Delivery Type:

o   Instant Delivery

o   Schedule Delivery

•         Online Grocery Market, By Region:

o   North America

§  United States

§  Canada

§  Mexico

o   Europe

§  France

§  Germany

§  Spain

§  Italy

§  United Kingdom

o   Asia-Pacific

§  China

§  Japan

§  India

§  Vietnam

§  South Korea

o   Middle East & Africa

§  South Africa

§  Saudi Arabia

§  UAE

§  Turkey

§  Kuwait

§  Egypt

o   South America

§  Brazil

§  Argentina

§  Colombia

Competitive Landscape

Company Profiles: Detailed analysis of the major companies presents in the global Online Grocery Market.

Available Customizations:

Global Online Grocery Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).