- Online grocery shopping is expected to keep growing even if the coronavirus outbreak subsides in the coming months, according to a report by BI Intelligence.
- More than half of US shoppers are expected to have bought groceries online by next year, the report says.
- The growth is seen across all age groups, with the percentage of Baby Boomers doubling during the pandemic so far.
- The forecasts show how the coronavirus is turning out to be a boon for online grocery services, as more people buy fresh produce like eggs and milk online for the first time to avoid physical contact with others.
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Online grocery shopping is at a tipping point amid COVID-19, with more US consumers buying fresh produce like eggs and milk than ever.
According to a new report by Business Insider Intelligence, the coronavirus pandemic is pushing more US consumers to buy groceries online, as they seek to avoid contact with others at physical stores. The report, based on third-party shopping data and a survey of 1,199 US adults, forecasts at least 43% of US consumers to have purchased groceries online by the end of June, up from 34% at the end of March and 24% at the end of last year.
That number is expected to keep growing, as more US consumers find online grocery shopping appealing. The report said the online grocery penetration rate in the US will exceed 50% next year, and reach 55% by 2024, even if the pandemic subsides in the coming months. If the outbreak worsens in the next few months, the penetration rate could go up to 66% in 2024, the report said.
"Online grocery shopping was already on the rise, but now it has newfound importance to consumers, giving services the chance to become a key service for customers during and after the pandemic," BI Intelligence's Daniel Keyes wrote in the report.
The forecast shows how the coronavirus outbreak is turning out to be a boon for the burgeoning online grocery market. As more people start buying groceries online for the first time due to the pandemic, they could end up becoming more frequent and permanent users of the service going forward.
The increase in adoption is coming from shoppers of all generations. While the younger shoppers are driving the growth, the percentage of Baby Boomers shopping for groceries online has doubled during the pandemic so far, according to the report. Nearly half of the Baby Boomer shoppers were first-time users of online grocery services, it said.
Companies that offer grocery delivery and pick-up services, including Amazon, Walmart, Target, and Instacart, stand the benefit the most from this change in shopper behavior, the report said.
In fact, Amazon announced on Sunday that it would stop accepting new grocery customers, and start wait-listing them to help it keep up with a surge in demand. It's also expanding delivery windows for existing customers, while nearly doubling the number of Whole Foods stores that deliver in the US. On top of that, Amazon said it's hiring an additional 75,000 warehouse workers - after having hired 100,000 new employees last month - to alleviate pressure on its workforce and facilities.
Other grocery-delivery services, like FreshDirect, PeaPod, and Walmart, have experienced high demand as well, leading to site issues and shortages, according to the Wall Street Journal.