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Ways of buying goods has evolved over the times owing to easy availability of the product. Online shopping segment is dominated by electronics and fashion goods. The online grocery market although is a bit new to the sector; the demand has grown rather exponentially. Doorstep delivery and the hectic schedule of the working people have been the major drivers of the market. Ever since the COVID-19 broke out online grocery vendors are inevitably been the go-to option for the shopping of home needs, as the public is in lockdown and offline retail stores are closed increasing the market like never before.
In the current situation of lockdown factors such as the limited operating hours at supermarkets and limit on number of shoppers allowed in the stores to maintain social distancing pushing the customers to choose online over outlet shopping for groceries.
The same day delivery and within an hour delivery features are available for premium customers. This willingness of customers to pay extra for this will boost the market. Also the amount spent by customer per order has significantly increased.
In US, Walmart largest supermarket chain has seen a surge of 21% in online grocery sales in the month of March.
The dedicated online grocery vendors such as BigBasket and Grofers deliver to close to 30 cities across India. These the 2 leading vendors have witnessed double the number of orders per day compared to period before lockdown. They are operating more than 200,000 orders per day as per April 2nd week.
In US traditional retail grocery outlets like Albertsons, Target and Kroger are all rapidly evolving into digital vendors. SNAP (Supplemental Nutrition Assistance Program) benefits the eligible low-income individuals by providing the budget to buy groceries has extended the services to shop online, helping to increase the customers for the online vendors.
Europe collectively is worst hit region in number of positive cases of COVID-19. Since the lockdown restrictions are stricter in this region compared to US, the public is force to turn to online shopping for essentials such as groceries. In European countries the dairy products have been the most popular fresh product purchase followed by fruits and vegetables ever since the lockdown.
MissFresh online grocery delivery start-up had witnessed a jump in orders by 237 percent in the month of February. Dingdong Maicai most profitable online platform had doubled its daily users in January last week. Alibaba invested 200 billion Yuan to boost the deliveries in Hubei region.
Increase in penetration of internet services and smartphone number in the country have been the major contributors for online grocery market. Southern India accounts for more urbanised cities and holds the higher market share. In the northern and western region due to less urban population the market is limited to few cities.
Amid lockdown, cab service provider Uber has started delivery service options called Uber Direct and Uber Connect in US, Mexico and Australia. This will help the online grocery vendors to increase the supply and spend less on transportation.
BigBasket India has invested more 60 million USD in the current situation to meet the surging demand from the public.
Amazon is partnering with the local grocery stores to sell the goods through their company’s platform and is investing 1.3 million USD. This will boost Amazon’s penetration in Indian grocery market.
In US InstaCart, Amazon, Boxed are the major dedicated online grocery vendors. Many offline retail firms have evolved into online vendor, competing these vendors.
In UK offline stores turned online vendors Sainsbury, Asda and Lidl. Ocado and Amazon are leading online vendors.
Chinese firms such as DingDong Maicai, Yihaodian and Wai Yee Hong are the leading players in this sector.
The 2 big online vendors from India are BigBasket and Grofers. Amazon and Flipkart with their online services Amazon Pantry and Flipkart Supermart have reached far more more cities in India than the former 2.
