Online Grocery Market Outlook

According to the report by Expert Market Research (EMR), the global online grocery market size attained a value of USD 349.8 billion in 2024. With the increasing demand for convenient shopping experiences, the growing adoption of e-commerce, and changing consumer preferences, the market is projected to further grow at a compound annual growth rate (CAGR) of 15.50% between 2025 and 2034, reaching a value of USD 2,580.3 billion by 2034.

Online grocery shopping, also known as e-grocery, is transforming the way consumers purchase their food and household essentials. The online grocery market encompasses a variety of products, including fresh produce, packaged foods, beverages, and household supplies. With the rise of mobile applications and the increasing use of digital payment systems, more consumers are shifting towards online grocery shopping as a convenient and efficient option. The market’s growth is also being fueled by innovations in delivery systems, the expansion of online grocery services, and the growing preference for contactless shopping, all of which are expected to continue driving its expansion in the coming years.

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Market Drivers

The key drivers of the global online grocery market include convenience, a wide selection of products, and the increasing use of mobile technologies. Online grocery platforms offer an unparalleled level of convenience by allowing consumers to order groceries from the comfort of their homes, avoiding long queues and reducing the time spent shopping in physical stores. The rapid adoption of smartphones and other internet-connected devices has further facilitated this shift, as consumers can now easily browse, order, and pay for their groceries via mobile apps and websites.

In addition to convenience, the availability of a broad range of products is also attracting consumers to online grocery services. E-grocery platforms offer a wide variety of goods, including fresh produce, organic products, frozen foods, snacks, and beverages, which can be conveniently delivered to consumers’ doorsteps. Many platforms also provide customers with personalized recommendations based on their purchase history and preferences, enhancing the shopping experience and encouraging repeat purchases.

The growing trend of health and wellness has also played a significant role in boosting the demand for online groceries. Consumers are increasingly seeking healthy, organic, and specialized food products, which are often easier to find through online grocery platforms that offer a wider selection compared to traditional brick-and-mortar stores. Moreover, the rise of convenience-based diets, such as meal kits and ready-to-eat meals, has further accelerated the growth of the online grocery market.

Technological Advancements

Technology is playing a pivotal role in shaping the online grocery market, enhancing the efficiency of e-grocery platforms, and improving customer satisfaction. Automation, artificial intelligence (AI), and data analytics are being increasingly leveraged to streamline operations, optimize delivery systems, and personalize shopping experiences.

One of the most significant technological advancements is the use of AI in supply chain and inventory management. By analyzing purchasing patterns and predicting demand, AI algorithms can help online grocery platforms better manage inventory, reduce stockouts, and minimize waste. This is particularly important for perishable goods such as fresh produce, dairy, and meat, which require effective inventory management to maintain quality and freshness.

In addition to AI, the integration of advanced robotics in warehouses is improving the speed and accuracy of order fulfillment. Automated picking systems, robots for sorting products, and drone delivery systems are enhancing the operational efficiency of online grocery platforms and reducing delivery times. Furthermore, the development of autonomous vehicles and drones for delivery is set to revolutionize last-mile delivery in the e-grocery industry, offering faster and more cost-effective solutions for consumers.

Digital payment technologies have also contributed to the growth of the online grocery market. Secure, seamless payment options, including digital wallets, credit cards, and buy-now-pay-later services, have made it easier for consumers to make purchases and enhance the overall online shopping experience.

Changing Consumer Preferences

Consumer behavior has evolved significantly in recent years, with an increasing number of people preferring the convenience and accessibility offered by online grocery shopping. The COVID-19 pandemic further accelerated this trend, as social distancing measures and lockdowns prompted more consumers to switch to online grocery platforms to meet their daily needs.

The convenience of home delivery, the ability to compare prices, and the option to order groceries at any time of day have made online grocery shopping increasingly attractive to busy professionals, parents, and other consumers seeking to save time and effort. Consumers are now also prioritizing safety and hygiene, preferring contactless delivery and online payment options to avoid unnecessary interactions in-store. This shift in consumer preferences is expected to continue, with a growing proportion of grocery shopping being conducted online.

The rise of digital-native generations, such as Millennials and Gen Z, who are highly comfortable with technology and online shopping, is further fueling the growth of the online grocery market. These younger consumers are more likely to embrace e-grocery services and explore innovative shopping experiences, such as subscription-based meal kits or on-demand grocery delivery.

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Online Grocery Market Segmentation

The global Online Grocery Market can be divided based on product, platform, purchase, region.

Some of the major players explored in the report by Expert Market Research are as follows:

• Amazon.com Inc.
• Walmart Inc.
• The Kroger Co.
• Costco Wholesale Corporation
• Target Corporation
• Tesco Plc
• JD.com, Inc.
• Fresh Direct, LLC
• Albertsons Companies, Inc.
• Maplebear Inc. (Instacart)
• Others

Challenges in the Market

While the online grocery market is experiencing significant growth, several challenges remain. One of the key challenges is the logistics and supply chain complexities involved in ensuring the timely and efficient delivery of perishable goods. Perishable items require specialized handling, packaging, and storage conditions to maintain their quality during transportation. Online grocery platforms must invest in advanced logistics solutions, such as temperature-controlled delivery vehicles and smart packaging, to ensure that these products reach consumers in optimal condition.

Another challenge is the fierce competition in the online grocery space. The market is highly fragmented, with numerous players ranging from large retailers like Amazon and Walmart to niche local providers. E-grocery platforms must differentiate themselves through competitive pricing, excellent customer service, and value-added services such as subscription models or personalized shopping experiences

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