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Integrations into its loyalty program, gamified quests, location-based coupons, and aisle-aware advertising formats, match consumers鈥� requests for retailers. 55% of customers find gamification opportunities extremely/very important in their grocery loyalty programs, per a May 2024 survey from Lobyco. And 62% of customers have used a digital offer to save on groceries within the last month.

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.

DoorDash will grow its US grocery sales 22.9% this year, reaching $8.26 billion, accounting for 13.5% of grocery delivery intermediary sales, according to our October 2024 forecast. This places DoorDash second behind Instacart, which will rake in $35.35 billion, or 57.7% of US grocery delivery intermediary sales this year.

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.

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.

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.

Instacart鈥檚 revenues and profits spiked in 2022, helped by its growing ad business: That could speed up the timeline for the grocery delivery company鈥檚 long-awaited IPO.

Digital: 础濒产别谤迟蝉辞苍蝉鈥� digital sales grew 23%, reaching over 7% of its grocery revenues. The retailer attributed these gains to new mobile app capabilities and improvements in its DriveUp & Go and in-home delivery services. Albertsons still sees significant room for expansion, as its digital penetration remains under industry benchmarks.

Nearly half (48.4%) of Amazon Fresh shoppers try new grocery products multiple times per month, according to an Insider Intelligence survey.

Three-quarters of the retailer鈥檚 share gains in 2024 came from higher-income consumers visiting Walmart for groceries and general merchandise like apparel. They鈥檙e also willing to pay more for faster delivery options. Walmart is courting those customers with a broader array of premium products across a number of categories, including grocery, beauty, and apparel.

On today's episode podcast, in our "Retail Me This, Retail Me That" segment, we discuss why Amazon is struggling to get Amazon Fresh off the ground, what it has going for it, and what would happen if Amazon broke out a separate subscription for grocery. Then for "Pop-Up Rankings," we rank the other players that could offer lessons on how Amazon Fresh could compete with Walmart. Join our analyst Sara Lebow as she hosts analyst Blake Droesch and director of content Becky Schilling.

Instacart鈥檚 ad growth slowed in Q4: That could create problems for the company as it relies more heavily on ads to offset softening grocery delivery demand.

While both those companies primarily provide restaurant delivery, they are rapidly growing their grocery businesses. For example, our forecast expects DoorDash to make $5.26 billion in online grocery sales this year, which is over nine times the $580 million it generated in 2020.

Temu could try appealing to inflation-weary consumers by introducing the gamified, group-buying grocery shopping concept that made sister app Pinduoduo enormously popular in China.

Instacart leans on advertising to bolster its bottom line: The company鈥檚 advertising revenues grew 19%, significantly outpacing the 4% growth in the number of online orders on its platform.

Braintree, for example, is focused on ticketing and tied up with Live Nation, whereas Adyen partnered with Instacart, which could offer inroads into online grocery.

How brands can grow digital grocery sales in 5 charts. How retailers can use discount, dollar store strategies to protect their grocery share.

Aldi opened more US stores in 2022 and 2023 than any other grocery chain, according to February 2024 data from JLL and RetailStat.

Walmart and Instacart are outperforming Amazon in digital grocery, which could prevent the company from market share gains in food and beverage and health/personal care/beauty. So far, Amazon has held off competition from Temu and Shein, but the upstarts could stunt future growth in categories like apparel, footwear, and accessories. Read the full report, US Amazon Ecommerce Forecast 2024.

The hope is that consumers will get used to the convenience and savings offered by Amazon and turn to the retailer to fulfill more of their needs鈥攁 reasonable assumption given that long-term growth in the digital grocery space will come from existing buyers spending more of their grocery budgets online.

Among grocery delivery intermediaries, Instacart remains dominant, capturing 73.0% of 2023鈥檚 digital grocery sales. Klarna: While not a retailer, Klarna鈥檚 media network is also uniquely positioned to reach consumers at the point of purchase through in-app and in-feed ads, sponsored search placements, and shoppable video content.

Amazon rolls out US grocery subscription as it tries to halt Walmart鈥檚 momentum: But the offering鈥檚 high cost relative to those of competitors could limit its impact on Amazon鈥檚 grocery business.