Stay ahead of the curve and secure future growth for your business with Mintel’s US Online Grocery Retail Market Report 2024. Get a 360° view of the online grocery market including market size, segmentation and forecasted growth to help you align your business strategy with the needs of your audience.
Topics Analyzed in this Report:
- Economic factors impacting online grocery retailing
- Online grocery shopping frequency
- Retailers shopped and grocery apps and memberships used
- Reasons for grocery shopping online
- Barriers to shopping for groceries online
- Pre-shopping and online shopping behaviors
- Grocery promotions of interest
- Online grocery features and services of interest
US Online Grocery Market Outlook
Over a third of US consumers plan to increase their online grocery shopping use within the next year. Younger consumers will be the primary drivers of this increase as they rely on delivery services to help them manage their busy schedules and to simply take advantage of memberships they already pay for. Brands in the US online grocery market need to be prepared to meet this demand with efficiency.
US Online Grocery Future Trends
Evolving technology is rapidly changing the online grocery landscape. For example, AI is offering more personalized options and retailers are finding ways to provide delivery reservations. The typically transactional experience will evolve to become more tailored to consumers: brands and retailers need to incorporate custom offerings to stay ahead of the trends.
One of the biggest opportunities in the market is to offer more white-glove services. Consumers already expect fast delivery with correct orders: brands and retailers need to go beyond this expectation and offer ways to help consumers manage their health, take advantage of promotions and guide them to products of interest.
Competition will increase within the marketplace, especially as more delivery services (eg Grubhub, Uber Eats) enter the grocery delivery space. Brands and retailers will need to give consumers a strong reason to shop with them – loyalty programs and memberships could be options.
Purchase the full report for a complete overview of the US online grocery retail market, including exclusive consumer insights and comprehensive analysis from Mintel’s industry experts. Readers of this report may also be interested in Mintel’s US Loyalty in Retail Market Report.
More About This Report
This report focuses on all retail channels that sell grocery products online, including internet-only retailers as well as the ecommerce operations of traditional supermarkets, warehouse clubs, natural markets, drug stores, dollar stores, convenience stores and specialty food retailers. Groceries are defined as products such as food, beverages, household goods (eg cleaning products, toilet paper, garbage bags), and personal care products. The primary focus of research is on food and beverages.
Meet The Expert
This report is written by Katie Hansen, Senior Analyst – Retail & eCommerce at Mintel. Katie joined Mintel in July 2019 and writes a variety of reports within the retail and ecommerce space. She has experience in researching consumer behavior and enjoys observing the ever-evolving retail landscape, consumers’ changing behaviors and uncovering the “why” behind those behaviors.
Consumers continue to seek out convenience, driving growth for online grocery. Retailers will look to offer elevated, personalized services with tech such as AI.
Katie Hansen
Senior Analyst – Retail & eCommerce
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Executive Summary
- What you need to know
- Consumer trends: key takeaways
- Market size & forecast
- Market predictions
- Opportunities
- Presentation: Shaping the US Retail Grocery Landscape
- Shaping the US Retail Grocery Landscape
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Market Dynamics
- Market context
- Market drivers
- Even with slowly falling prices, consumers’ optimism remains low leading to cautious grocery shopping
- Consumer prices rose by 3.4% in April, slightly down from March
- Graph 1: headline CPI and shelter CPI, 2022-24
- Consumer sentiment fell by 13% in May
- Graph 2: consumer sentiment index, 2021-24
- State laws could make it simpler for consumers to take advantage of coupons
- Burgeoning younger populations will drive online grocery growth
- AI and beyond will further transform the grocery shopping process
- Market size and forecast
- Retail sales and forecast of online groceries
- The pandemic led to a jump in online grocery sales; a return to normalcy sees sales leveling out
- Market segmentation
- Retail sales of online groceries, by segment
- Graph 3: total retail sales and forecast of online groceries, by segment, at current prices, 2018-23
- Retail sales of groceries, by segment
- Online groceries go beyond food and drink selections
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Consumer Insights
- Consumer fast facts
- The online grocery shopper profile
- Online channels are supplemental to the overall grocery shopping process
- Graph 4: grocery shopping channel, 2024
- In-store shopping is still dominant, but online has a significant place within the market across consumer groups
- Graph 5: [no title]
- Gen Z, Millennials lead in online grocery adoption
- Graph 6: grocery shopping channel, by generation, 2024
- Boomers shouldn’t be overlooked online
- Urban consumers take advantage of online benefits
- Graph 7: grocery shopping channel, by area, 2024
- Fulfillment preferences
- Home delivery is key to online grocery shopping
- Amazon launches Recurring Reservation slots
- Consumers want more convenient delivery windows
- Graph 8: attitudes toward grocery shopping online – delivery options, 2024
- In-store pickup is an opportunity for brands to encourage add-on purchases amongst younger generations
- Graph 9: grocery delivery and pick-up options used, by generation, 2024
- Curbside is more appealing for suburban, rural consumers than urbanites
- Graph 10: grocery delivery and pick-up options used, by area, 2024
- Anticipated online grocery shopping frequency
- Busy, younger consumers will drive online grocery growth
- Graph 11: anticipated online grocery shopping frequency, by generation, 2024
- Hispanic consumers are a key opportunity in the market
- Graph 12: anticipated online grocery shopping frequency, by race and Hispanic ethnicity, 2024
- Grocers in urban environments are prime for online grocery growth
- Graph 13: anticipated online grocery shopping frequency, by area, 2024
- Natural/organic buyers plan to increase their reliance on online grocery options
- Graph 14: anticipated online grocery shopping frequency, by natural/organic buyers, 2024
- Retailers shopped, grocery apps and memberships
- Mass merchandisers and Amazon are staples in consumers’ grocery shopping trips
- Graph 15: grocery retailers shopped – any shopping, 2024
- Prime and Walmart+ remain top contenders for online grocery shoppers
- Graph 16: grocery apps and membership subscriptions, 2024
- Younger consumers need to see value from their grocery memberships
- Graph 17: grocery apps and membership subscriptions, by generation, 2024
- Walmart+ and Instacart has opportunity amongst Black and Hispanic communities
- Graph 18: grocery apps and membership subscriptions, by race and Hispanic ethnicity, 2024
- Reasons for grocery shopping online
- Time savings and prices drive online grocery shopping…
- Graph 19: reasons to grocery shop online, 2024
- …but “fun” has its place too
- Instacart packs in the fun with specialized offerings
- Retailers can attract more shoppers online with better pricing and deals
- Graph 20: attitudes toward grocery shopping, 2024
- Older consumers shop online for practical reasons; younger consumers are more nuanced
- Graph 21: reasons to grocery shop online, by generation, 2024
- Older consumers shop online for practical reasons; younger consumers are more nuanced (cont.)
- Women need convenient, easy-to-use online solutions
- Consumers are still hesitant to purchase fresh items online; specific searches are a bright spot for retailers
- Graph 22: occasions for grocery shopping online, 2024
- Younger consumers leverage online grocery shopping for a wide variety of occasions
- Graph 23: occasions for grocery shopping online, by generation, 2024
- Retailers can tap into weeknight occasions to drive interest from younger consumers
- Barriers to grocery shopping online
- Seeing is believing for consumers when shopping for groceries
- Graph 24: barriers to shopping for groceries online, 2024
- Other ways retailers can address the freshness barrier to online grocery shopping
- Consumers want more control over fresh items, shopper selection
- Graph 25: attitudes toward grocery shopping online, 2024
- Baby Boomers have trust issues when shopping for groceries online
- Graph 26: barriers to shopping for groceries online, by generation, 2024
- Pre-shopping behaviors
- Research and planning helps keep consumers on budget
- Graph 27: pre-shopping behaviors, 2024
- Digital coupons are preferred over paper options
- Younger consumers utilize social media to unlock meal creativity
- Graph 28: pre-shopping behaviors, by generation, 2024
- Pinterest inspires consumers to try new meals
- Multicultural consumers are price sensitive
- Graph 29: pre-shopping behaviors, by race and Hispanic ethnicity, 2024
- A “previously purchased” list could assist busy parents
- Graph 30: pre-shopping behaviors, by parental status and gender, 2024
- Online shopping behaviors
- Retailers can create filters to make it easier for consumers to find foods based on their dietary needs
- Graph 31: online shopping behaviors, “I typically…”, 2024
- Including samples in online orders can surprise, delight consumers while exposing them to new products
- Make grocery shopping interactive for younger consumers shopping with purchase influencers
- Delivery fees can be a barrier for Hispanic consumers, but can also lead to increased purchases
- Retailers can provide online features that help parents find the items that best suit their families’ needs
- Graph 32: online shopping behaviors, by parental status and gender, 2024
- Grocery promotions of interest
- Consumers are drawn to offerings that provide immediate cost savings
- Graph 33: grocery promotions of interest, 2024
- Value is essential across income levels
- Graph 34: grocery promotions of interest, by household income, 2024
- Value is essential across income levels (cont.)
- Moms are the deal hunters in the family
- Graph 35: grocery promotions of interest, by parental status and gender, 2024
- Walmart launches Moms Answer Moms campaign with celebrity moms
- Dollar off discounts attract price-conscious multicultural consumers
- Graph 36: grocery promotions of interest, by race and Hispanic ethnicity, 2024
- Online grocery shopping attitudes
- Consumers across generations find the online experience more convenient than in-store shopping
- Graph 37: attitudes toward grocery shopping – convenience, by generation, 2024
- Consumers across generations find the online experience more convenient than in-store shopping (cont.)
- Online grocers have opportunity to better showcase the convenience aspect to Black and Hispanic shoppers
- Graph 38: attitudes toward grocery shopping – convenience, by race and Hispanic ethnicity, 2024
- The good news: most consumers are willing to pay for the convenience of online grocery
- Graph 39: attitudes toward grocery shopping online – convenience, by generation, race and Hispanic ethnicity, 2024
- Consumers across generations find that the online and in-store experience are both enjoyable
- Graph 40: attitudes toward grocery shopping – enjoyment, by generation, 2024
- Retailers can showcase new products to drive impulse purchases
- Graph 41: attitudes toward grocery shopping online, 2024
- Brands and retailers have an opportunity to drive impulse purchases with Gen Z
- Graph 42: attitudes toward grocery shopping online, by generation, 2024
- Target highlights coffee at home on social media
- Retailers can expand beyond grocery offerings
- Graph 43: attitudes toward grocery shopping online, 2024
- Grocers can leverage social media to spark inspiration
- Online grocery features and services of interest
- Retailers can lean into features that personalize the online shopping journey
- Graph 44: online shopping features of interest, 2024
- Consumers who are highly engaged in their food choices want more ways to be involved in the process
- Younger consumers, especially Millennials, want more white-glove services and engagements from retailers
- Graph 45: online shopping features of interest – select responses, by generation, 2024
- Grocers can tap into a variety of options to engage younger generations
- Adopting technology can help retailers improve the online shopping experience
- Graph 46: technologies of interest when grocery shopping, 2024
- Hellman’s taps AI to create recipes based on what’s in a consumer’s fridge
- Parents are most open to a variety of online grocery tech and tools
- Graph 47: technologies of interest when grocery shopping, by parental status and gender, 2024
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Innovation and Marketing Trends
- Marketing and advertising
- Instacart aims to be everywhere for nearly everyone
- Instacart aims to be everywhere for nearly everyone (cont.)
- Walmart steps up its delivery game
- Grubhub expands into grocery with new partnerships
- Kroger partnered with food media brand Delish to spice up meal kit offerings
- Kroger partnered with food media brand Delish to spice up meal kit offerings (cont.)
- Amazon offers another way for Prime, EBT consumers to take advantage of online grocery
- Opportunities
- Ways grocers can offer services and connection points that elevate the online grocery experience
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Appendix
- Market definition
- Consumer research methodology
- Generations
- Abbreviations and terms
- Market size methodology
- Forecast methodology
- Forecast fan chart methodology
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