2023 Digital Grocery: Year in Review

Summary

The "2023 Digital Grocery Year in Review" report offers an extensive analysis of the digital grocery landscape, emphasizing the significant role of omnichannel strategies in shaping the industry. With $926 billion in total grocery sales, of which $121 billion (13%) were digital sales, the report underscores the growing influence of digital channels.

The report also discusses the impact of inflation, which led to an increase in basket sizes and a consolidation of spending with fewer grocers. Despite these challenges, large and medium grocers experienced positive growth in the latter half of the year. Additionally, the report examines the decline in third-party sales and the increasing focus of grocers on owning the shopper experience.

Take a deep dive into the new wave of consolidation in the grocery sector, driven by stringent market conditions and the departure of zero-interest-rate policies. This trend underscores the importance of geographical reach in digital strategy and suggests an imminent consolidation among 'quick' commerce and third-party apps, with acquisitions and mergers expected to redefine the marketplace.

The emergence of AI as a competitive lever, particularly for small and medium grocers, is another key theme. With a projected 4x increase in spending on AI capabilities by 2025, AI is expected to transform various aspects of the grocery industry, especially in supply chain and merchandising.

Why should you download this report:

Comprehensive Market Analysis

Delve into an in-depth analysis of the $926 billion grocery industry. Discover insights about the 69% of grocery sales influenced by digital channels, amounting to a significant $640 billion in digitally influenced sales.

Insight into Consumer Behavior

Understand how shoppers adjusted to inflation, leading to a substantial 23% increase in basket sizes from Q1 to Q4 '23. Examine consumer trends, including their shift to spending consolidation with fewer grocers and the necessity for a 12% increase in spending to maintain 'parity' in 2023.

Technological Advancements

‍Explore AI's transformative impact in the grocery sector. With 83% of grocers prioritizing AI at the C-level and a forecasted quadrupling in AI investment by 2025, learn how AI is expected to be a key driver in supply chain and merchandising advancements.

Strategic Insights for Grocers

‍Analyze the decline in third-party sales, projected to fall below 15% in 2024. Understand how grocers are now focusing more on owning the shopper experience, with third-party sales having almost halved since the start of 2022.

Future Projections

‍Look ahead with projections of $132 billion in digital grocery sales by 2024, which would represent 13.7% of all grocery sales. Gain insights into anticipated trends in digital revenue growth, the execution of omnichannel strategies, and the integration of store and digital channels.

Survey Demographics

The report is based on the analysis of 2.2 million shopper orders in the US between January 1, 2022, and November 30, 2023.

Grocery shoppers surveyed: 40,133

Executives surveyed: 3,883

This comprehensive dataset offers a robust foundation for the insights and trends discussed in the report.