UK online grocery is the world’s second largest and will be worth $28bn

The Chinese online grocery market, already the world’s largest, is set to be worth almost $180bn by 2020 – nearly five times its current value of $41bn, according to the latest IGD research.

Time-pressed shoppers increasingly using mobile technology is driving global demand for online grocery shopping

Joanne Denney-Finch, IGD chief executive, said: “There’s going to be significant growth across all of the top 10 online grocery markets. This is being driven by busy shoppers making the most of more digital technologies and the rising trend of ‘anywhere, anytime shoppers’. They add to their online shopping basket over a period of time on whichever device is most handy at that moment. New innovations, such as grocery delivery services from Instacart and Uber, are also helping to support online’s rapidly increasing popularity by providing convenient time-saving solutions.

“Already the world’s largest, the Chinese online grocery market is maturing rapidly and will significantly dwarf other countries by 2020. This will be powered by more people in China having access to the internet both through smartphones and other devices. Given the size of its population, even a small change will have a significant impact.

“Most online sales in China take place through digital marketplaces, such as Alibaba’s business to consumer site Tmall. These allow international retailers without stores in China to gain instant access to new customers and tap into the booming Chinese market with limited investment.

“Other international retailers, as well as local players, are also launching their own online and mobile grocery shopping sites. Food is seen as an affordable luxury, with foreign brands popular with Chinese shoppers wary of the safety scares surrounding locally sourced food and drink. To cater for this demand, companies such as Alibaba and Amazon have recently introduced dedicated sites for imported goods.

“Many Chinese people also prefer shopping using their smartphones, so retailers are offering mobile-only promotions which are updated regularly to encourage shoppers to keep visiting their websites for the latest deals.”

UK online grocery market

“The UK online grocery market continues to rapidly develop and will achieve impressive growth to reach $28bn (£17.2bn) by 2020,” said Denney-Finch. “This is being driven by shopper demand as well as new retailer innovations to make buying groceries online more convenient. The UK has always been a leader in online grocery, with both retailers and shoppers keen to embrace new technology, and we expect this to continue.

“Our latest research shows that three out of 10 British people bought their groceries online in the last month, with one in nine buying most of their groceries in this way. Convenient click and collect services are continuing to evolve. These include fully-automated 24-hour pick-up points, as well as more pick-up locations being rolled out at places such as petrol stations. Home delivery is also receiving a boost from lower priced delivery slots and delivery passes as well as shorter delivery windows including same day, leading to more frequent orders.”

Online shopping graph