Europe’s online grocery market is set to grow by 66% between now and 2023, adding $21 billion (€18.65 billion) in value, according to a new study by IGD in association with the Consumer Goods Forum.
The study was published with one week to go until this year’s Consumer Goods Forum Global Summit, which takes place in Vancouver from 11 to 14 June.
Global Growth
While Europe’s online grocery market is likely to show impressive growth over the period, this pales in comparison with predicted growth in Asia-Pacific, where online grocery is expected to grow by 196% by 2023, adding $198 billion.
In addition, North America’s online grocery market will grow by 152% in the same period, adding $38 billion.
Online Share
In Europe, the share of online grocery is expected to rise to 2.5% by 2023, up from 1.8% currently, while in Asia-Pacific, it is expected to reach 7.5% (3.4% currently), and in North America, it is poised to reach 3.4% (1.5% currently).
Commenting on the findings, Susan Barratt, chief executive of IGD, said, “We are living in exceptional times, with an extraordinary burst of retail innovation, driven largely by digital developments.
“With this research, we explore the global proliferation of retail innovation from three different directions: established players, online specialists, and the new ecosystems,” Barratt added. “We believe that plenty of the new, emerging models are set to grow and prosper, which means established retailers will need to work hard and swiftly, either to limit their impact or to emulate them.”
Driving Evolution
According to IGD, a number of factors are likely to contribute to the ‘digital evolution’ of the grocery marketplace.
Firstly, it reported that technology-led strategic partnerships are likely to accelerate rapidly, with technology firms set to have a much stronger influence on CPG retailing.
In addition, advanced digital technology will help physical stores close the data gap on pure-play operators.
The commercial trading interface between established retailers and suppliers will be transformed by AI, IGD added, with traditional retailers set to diversify and become less reliant on selling products.
Retailers with the best data capabilities will win in the long term by becoming incrementally better with every passing day, it noted.
‘Exciting Opportunities’
“While, of course, growth remains challenging for all of the established players in the industry, many are nevertheless finding that the ongoing disruption presents exciting opportunities,” said Peter Freedman, managing director, the Consumer Goods Forum.
“This report presents several ideas for consumer goods and retail companies looking to secure their long-term future, and we'll be discussing some of these themes at the Global Summit in Vancouver: how scale and agility can impact your business model, how digital technologies will permeate decisions, and how new forms of collaboration will help drive the sustainable evolution of our industry,” added Freedman.
For more information on IGD’s study, visit www.igd.com/digitalretailmodels. For information about the Consumer Goods Forum Global Summit, log on to www.theconsumergoodsforum.com.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
