Online Grocery Sales to Quadruple in Next Five Years

ROCKVILLE, Md. — Online sales of groceries more than tripled between 2013 and 2018, and the momentum will continue to propel the industry in the future, according to a new report from market research firm Packaged Facts.

Online Grocery Shopping in the U.S., 2nd Edition forecasts that online grocery sales will more than quadruple between 2018 and 2023, as online options become more available and consumers become more open to trying online shopping or using online options more frequently to purchase their groceries.

Most of the market’s growth has occurred since 2016 as e-commerce platforms and conventional grocery stores increased both their participation and their geographic footprint with expanded service areas. For example, in August 2017, ALDI began a partnership with Instacart, the largest third-party pack-and-deliver company, in three cities to allow online orders and delivery. By September 2018, the company announced the partnership would expand to all of its stores in the U.S.

Amazon and Walmart are currently the key participants in the market, collectively accounting for nearly 28 percent of online grocery sales. Instacart, Kroger, FreshDirect and Peapod represent other large providers in the online grocery market.

Looking ahead, Packaged Facts anticipates Walmart’s dominance as a grocer, with its nationwide presence and large number of rural stores, giving it a competitive advantage in expanding online grocery shopping to much of the U.S. population.

"Three key factors have created a perfect environment for growth of the online grocery market in the U.S. over the last five years. There's been increased use of mobile phones and smartphones, interfaces for websites and mobile apps have improved, and there’s been a notable expansion of crowedsourced business models to shopping and delivery," noted David Sprinkle, research director for Packaged Facts.

More information on Online Grocery Shopping in the U.S., 2nd Edition is available here.