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Despite room for expansion, online alcohol delivery will never be essential like online grocery. Alcohol buying is rising in popularity. An April 2023 survey from PowerReviews found 23% of digital grocery buyers typically purchased alcohol via digital grocery platforms. This is an increase from the same survey鈥檚 responses on alcohol buying in 2021 (17%) and 2022 (20%).

Amazon bets that Prime members will pay extra for free grocery delivery: The retailer is testing a grocery subscription add-on for $9.99 per month in its latest attempt to boost the appeal of its grocery business.

Amazon explores standalone subscriptions as Prime user growth slows: The retailer could roll out separate grocery and healthcare membership services as early as this year.

Amazon鈥檚 inability to take full advantage in the grocery space gives Walmart and other digital grocery players a chance to gain ecommerce market share in the category. It will remain difficult for competing retailers to capitalize on Amazon鈥檚 stagnant overall ecommerce market share. Outside of food and beverage, the only other maturing ecommerce category where Amazon is missing out is auto and parts.

The news: In-store digital media provider Looma has secured $10 million in funding to help expand its In-Store Connect platform, increasing its presence across new and existing retail partners. By the end of 2024, Looma plans to expand its network from 800 to over 5,000 screens, including more categories within grocery stores, particularly the adult beverage section.

In 2020, when the pandemic caused digital grocery sales to skyrocket, Walmart grew its online grocery business by nearly 80%. While digital remains a small fraction of Walmart鈥檚 overall grocery sales, we expect it will continue to grow faster than its in-store sales.

More than half (57.2%) of the US population will be digital gamers this year, per our forecast. Gen Zers and millennials have the highest rates of digital gaming adoption at 73.8% and 65.5%, respectively. Another strategic tie-up: DoorDash reached a multiyear agreement with reward platform Ibotta to offer users cash-back digital offers across categories like grocery, home, and health.

US ecommerce growth will come from large retail categories with historically low online sales share. And growth will stay healthy even as traditional drivers of online sales take a backseat to emerging categories.

The service is currently being tested by online Asian supermarket Weee!, party supplies seller Oriental Trading Company, and wellness retailer iHerb, with other retailers (including Tillys) set to join soon. The solution puts Amazon in direct competition with companies like ad tech giant Criteo as well as Publicis, both of which have benefited considerably from the retail media boom.

Much of its success has come from its rapidly growing digital grocery business, which accounts for more than 62% of its ecommerce sales in 2023. Digital grocery is one area where Walmart is actually beating Amazon. This year, Walmart will capture more than 28% of the US digital grocery market鈥攎aking it the leading player in the industry鈥攃ompared with just 22% for Amazon.

Grocery shoppers are omnichannel shoppers, our analyst Blake Droesch said on a recent 鈥淏ehind the Numbers: Reimagining Retail鈥� podcast. That means consumer packaged goods (CPG) brands should employ a mix of digital and in-store advertising strategies to engage customers where they shop.

Click and Collect Will Drive Digital Grocery Growth. Click and collect鈥檚 explosive pandemic-era growth has tailed off, but for groceries the outlook is brighter. Grocery click-and-collect sales increased by 16.3% last year and will grow by 15.1% this year. These figures solidly outpace the metrics for overall click-and-collect growth.

The future of ecommerce is grocery. Historically, three categories led the US ecommerce market: apparel and accessories, computer and consumer electronics, and furniture and home furnishings. But in recent years, growth has been fueled by essential goods, including food and beverage items, personal care products, and household supplies. This shift will take grocery to the top of the four major ecommerce categories by 2026.