Global Online Grocery Market Overview, 2023-28

Online grocery refers to buying fruits, vegetables, meat, seafood, eggs, yogurt, milk, biscuits, snacks, canned items, and staples and cooking essentials through web-based platforms. It has a wide variety of goods in one place and provides several discounts, schemes, coupons, referral codes, and cashback on the purchase of a product as compared to the offline mode of grocery shopping. It attracts users by providing notifications about the delivery of products, latest offers, and new items launched. Online grocery shopping also helps customers to conveniently preview purchase history and keep track of expenditures. It is convenient, flexible, time and money saving, and provides goods delivery to your door while removing the need to wait in a big queue. It offers simple payment methods such as cash on delivery (COD), net banking and universal payments interface (UPI), and debit and credit card alternatives, as well as easy product return and exchange. It aids in understanding what products are in stock and selecting alternatives as necessary. Besides this, it offers freedom to consumers for comparing prices and manufacturing and expiry dates of products from different websites and purchase accordingly. The pandemic outbreak is particularly pushing the trend for online grocery shopping. As a result, the easy availability of time slots, lower service fees, and the convenience of picking up the grocery while on the way are encouraging people to use click & collect services, book the grocery online, and pick up the groceries they ordered while avoiding crowds. As a result, grocers are rapidly developing click-and-collect capabilities as part of their attempts to provide a convenient and robust consumer experience across their grocery network. According to the research report, “Global Online Groceries Market Overview, 2023-28” published by Bonafide Research, the market is anticipated to cross USD 1450 Billion by 2028, increasing from USD 397.06 Billion in 2022. The market is expected to grow with 25.14% CAGR by 2028. The changing buying preferences of customers in the aftermath of the pandemic, as well as the uninterrupted growth of the e-commerce business, are projected to fuel market growth over the forecast period. No human interaction resulted in a surge in the online sale of goods. Since the pandemic, retail brands such as Blinkit, BigBasket, Amazon, and others have seen major boost in grocery sales. Furthermore, the gradual opening of lockdown is offering several growth prospects to the industry growth. Also, factors such as increased urbanization, rising working population, hectic schedules, and increasing passive lifestyle adoption are expected to drive the growth of the online grocery market. Advances in technology, the continued urbanization, and the paradigm shift in consumers’ shopping habits are driving the preference for grocery shopping through online channels. For instance, in 2020, Walmart announced a partnership with Instacart for same-day grocery delivery. The collaboration enables Walmart to compete more effectively with Amazon as supermarket e-commerce soars from COVID-19. This collaboration offers Walmart customers in four trial markets: Los Angeles, San Francisco, San Diego, and Tulsa, Olka, providing access to Walmart's grocery delivery services while ordering through Instacart.

Prior to the pandemic, online grocery had a more narrow appeal, such as among young, urban, affluent families looking for the convenience of large-basket delivery to their home. Offerings have now been expanded to address other shopping objectives (such as top-up shopping) and client categories (such as younger and older generations). When delivery slots were restricted and client demand was high during the early stages of the COVID-19 epidemic, click-and-collect models saw an increase in demand. These approaches also assisted grocers in reaching customers outside of urban areas, such as suburban areas, small cities, and even rural locations. Overall, countries that have been slower to adopt online offers will experience increased penetration, owing to disruptive firms' capacity to modify customers' expectations and behaviours across propositions. Based on the delivery type the segment can be further classified into click and collect or home delivery. The home delivery option is expected to have a larger market share during the forecast period. The click and collect technique allows the user to make an order for the products through the internet website while picking the option for pick up. The advantage of a click and collect order is that it is delivered the same day or the next day. As a result, it saves time and money on shipment. Unprofitable business concepts and activities today may become more viable in the future as technology advances. Advanced personalisation, for example, has the potential to enhance order size for large-basket delivery, while automation has the ability to revolutionise the cost model for order preparation and last mile. The busier lifestyle, growing disposable income, increasing internet penetration, along with customer driven mechanism are driving the global online grocery market in terms of demand. From supply perspective, the multiple distribution channels, flexible delivery options, along with increasing e-payment services are driving the online grocery retail market. The key impediments to the expansion of the global online grocery business are faster and more effective logistical operations, as well as concerns about the cost-effectiveness of the downstream supply chain. During the pandemic, Amazon, in particular, has taken significant moves, responding rapidly to improve the safety and ease of supermarket delivery. To accommodate expanding demand, Amazon boosted the capacity of their grocery delivery service, increased food delivery windows throughout Amazon Fresh and Whole Foods stores, and increased hiring for delivery services between March 2020 and March 2021. Amazon also adjusted store hours to allow for more efficient fulfilment of online orders and even increased access, allowing for things like “unattended delivery,” to expand opportunities for how and when groceries can be delivered. The pandemic's impacts, such as store and restaurant closures and restrictions pushing everyone to stay at home and keep as much distance as possible, became forces that hastened the expansion of online grocery shopping. In just one year, the online food market gained customers and sales that would have taken much longer to achieve, and estimates show that this trend would likely continue even after the pandemic has passed. Based on the product types, the staples & cooking essentials segment dominated the market and accounted for the largest market share of over 25% in 2022. This category was able to control the market through recurrent purchases of staples such as wheat, food grains, and cooking basics such as oil, which are seen as requirements, particularly in families throughout Asia Pacific. Customers are still hesitant to go out and buy groceries they need every day, preferring to avoid crowds and adhere to social distance standards in the aftermath of the pandemic epidemic, therefore the basics & cooking needs category is expected to grow during the projection year. During the predicted period, the breakfast and dairy segment will rise at a considerable CAGR. Increased demand for diverse milk and non-milk products, as well as vendors' facilitation of doorstep delivery of these items, are significant reasons contributing to this segment's rapid growth. Due to their hectic lifestyles and increasing spare cash, customers are more inclined to order these products from online sellers than traditional retailers, particularly in the aftermath of the pandemic epidemic. Also, due to doorstep delivery available for the milk and milk products this market is growing. That is expected to be a higher growth in the fresh produce segment. Due to availability of meat and seafood online this market is also expected to rise in the forecast period. Online grocery stores cover a wide range of products, like the cereals, vegetables, fruits, bakery, breakfast products, Poultry and meat.

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Manmayi Raval

Research Consultant

As the demand for online groceries grows, retailers are increasingly using dark stores and micro-fulfilment centers to fulfil online orders. These facilities are dedicated to online order fulfilment and are designed to increase efficiency and speed up the delivery process. A dark store is a retail space that is closed to the public and used exclusively for online order fulfilment. These stores are designed to be more efficient for online order fulfilment compared to a traditional brick-and-mortar store. They typically have a smaller footprint, with products stored in aisles rather than on shelves. This makes it easier for staff to pick items for online orders quickly and efficiently. Micro-fulfilment centers are similar to dark stores but are smaller and more compact. They are typically located in urban areas and are designed to be closer to customers to allow for faster delivery times. These centers use automation technology to speed up the picking and packing process, allowing retailers to fulfil online orders more quickly and efficiently. The emergence of dark stores and micro-fulfilment centers is an important trend in the online grocery market that is helping retailers to improve operational efficiency and drive revenue growth. Online grocery retailers are using AI and machine learning to improve the customer experience, personalize recommendations, and optimize supply chain management. These technologies are helping retailers to improve operational efficiency and drive revenue growth. Many online grocery retailers are integrating omni-channel strategies, such as click-and-collect and curbside pickup, to provide customers with a seamless shopping experience. This allows customers to order groceries online and pick them up at a physical store location, increasing convenience and flexibility. Major Companies present in the market: Amazon, Alibaba, Tesco, Walmart Inc, Koninklijke Ahold Delhaize N.V.,, Rakuten Group Inc., Supermarket Grocery Supplies Private Limited, Choithrams , Zomato Considered in this report • Geography: Global • Historic year: 2017 • Base year: 2022 • Estimated year: 2023 • Forecast year: 2028

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Aspects covered in this report • Global Online Groceries market with its value and forecast along with its segments • Region-wise Online Groceries market analysis • Various drivers and challenges • On-going trends and developments • Top profiled companies • Strategic recommendation Regions covered in the report: • North America • Europe • Asia-Pacific • South America • Middle-East & Africa By Product Type • Staples & Cooking Essentials • Snacks & Beverages • Breakfast & Dairy • Fresh Produce • Meat & Seafood • Others By Delivery Type • Home delivery • Click and collect The approach of the report: This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases. After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this; we have started making primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once we have primary data with us, we can start verifying the details obtained from secondary sources. Intended audience This report can be useful to industry consultants, manufacturers, suppliers, associations, and organisations related to the artificial lawn industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.