Every step of the grocery shopping journey is being digitized; how do consumers feel about it?

Over half (56%) of US grocery retail executives are concerned about competition from internet grocery stores (like Thrive Market or Fresh Direct), according to a June 2024 survey from Deloitte. Nearly as many (53%) are concerned about third-party grocery shopping apps like Instacart or DoorDash.

Walmart’s market share gains continued in Q1 as the retailer emphasizes value and convenience: The company continues to draw in more high-income shoppers, while its advertising and marketplace offerings boost revenues.

Bad weather drove more shoppers to Instacart in Q1: The company expects the positive trend to continue in Q2 as it prepares to add Uber Eats to its platform.

Instacart and Uber team up to keep DoorDash at bay: Instacart hopes the deal will protect its grocery business and widen consumer appeal, while Uber looks for new customers.

Digital grocery will become the largest ecommerce category by 2026, according to our US Digital Grocery 2024 report. To grow their share of digital grocery sales, brands need to understand what motivates consumers to buy groceries online, how the digital grocery experience can be improved, and where growth opportunities lie.

What is shoppable media and which formats have the most potential?

Third-party grocery intermediaries lost share to grocer platforms in 2023, securing 15.2% of US digital grocery sales in Q4, down from 18.3% in Q1, according to December 2023 data from Incisiv and Wynshop.

The future of ecommerce is grocery. Historically, three categories led the US ecommerce market: apparel and accessories, computer and consumer electronics, and furniture and home furnishings. But in recent years, growth has been fueled by essential goods, including food and beverage items, personal care products, and household supplies. This shift will take grocery to the top of the four major ecommerce categories by 2026.

Grocery is set to become the largest US ecommerce category by 2026.

Amazon bets that Prime members will pay extra for free grocery delivery: The retailer is testing a grocery subscription add-on for $9.99 per month in its latest attempt to boost the appeal of its grocery business.

US ecommerce sales will grow 9.3% to reach $1.137 trillion in 2023, per our forecast, thanks to cost-conscious consumers looking for better deals and an increasing number of digital grocery buyers. As 2023 wraps up, ecommerce will go out on a high note, with online holiday sales growth outpacing brick-and-mortar sales.

Grocery spending is slowly shifting online as consumers seek convenience: More shoppers are leveraging grocers’ ecommerce options as well as delivery platforms like DoorDash and Uber Eats.

Walmart has the largest audience of any digital grocery platform. But our survey found that Amazon Fresh customers were more active and willing to try new products.

Digital activity now plays a major role in product discovery, with younger generations driving sizable shifts in the way shoppers find new products.

Though growth is slowing, digital grocery will continue to fuel overall ecommerce growth in the US. “Growth is no longer driven by new adopters, but heavy digital grocery users,” our analyst Blake Droesch said on a recent “Reimagining Retail” podcast episode. Here’s how retailers like Instacart, Amazon, and Walmart can capitalize on frequent buyers.

Shopping habits foretell the next phase of digital growth for grocery products.

Albertsons hit its marks in Q1: The company is leaning into private labels, growing its loyalty program, and boosting its digital sales.

Evolving consumer behavior and easing regulations are opening new pathways for long-term growth.

Amazon, Costco Wholesale, and other retailers now face an uphill battle to win recurring revenues in the era of subscription fatigue.