Global food e-commerce sales are projected to nearly triple through 2023, rising to $321 billion and accounting for nearly 5% of total e-commerce revenues, market research firm Packaged Facts noted in its new “Global Food E-Commerce” report.
Packed Facts forecasts that the Asia Pacific region will account for the majority of absolute growth, primarily due to the rapidly expanding Chinese market. The report noted that China dominates regional e-grocery activity in part because of the country’s large urban population and rapidly expanding middle class. In addition, much of China’s very large population has access to high-tech devices and has the ability to shop online due to the country’s position at the forefront of technological development and electronics, Package Facts said.
In 2018, more than 75% of food e-commerce revenues were concentrated in the top five markets: China, the U.S., Japan, the U.K. and South Korea. In each of these countries, e-grocery spending was highest in large urban centers, where many retailers have focused their marketing efforts for home delivery or click-and-collect services.
Through 2023, demand growth in these countries will be driven by the following five key factors identified by Packaged Facts:
- Increasing comfort among existing online shoppers in making routine grocery purchases online;
- Growing use of subscriptions and memberships with online retailers, which can promote retailer loyalty and increase online sales;
- Greater penetration of broadband internet in rural and remote areas that previously only had access to dial-up internet;
- Greater acceptance of, and investment in, home delivery, click-and-collect, and drive order fulfillment formats in an increasingly omnichannel retail environment, and
- Improvements to data security that ease consumer fears about having their personal information stolen while shopping online.