Online food market back to 9% after COVID high

Declining on a high of 10.3%, online food and grocery has plateaued. Still, retailers & suppliers need be prepared for a market here to stay.

The online food market is back to 9% share for March 22, indicating a plateau after peaking at 10.3% in the September 21 quarter. With a new COVID normal paradigm and a return to work for most, Australian consumers have returned to eating out of home and making more retail shopping trips, reducing the demand for online delivery.

This follows an international trend of decline in online market share, with most developed markets coming back 10-15% from their respective COVID related peaks.

Despite this easing, online retail is still up 2.1% on Mar 21, and generating a Mar 22 MAT for WW & Coles of $7.4B or the equivalent of their full service 190 full-service supermarkets. The scale will retail some level of market share.  This is acceptance of buying fruit and vegetables online is up, with their inclusion in 60% of online grocery orders.

Some online food entrants continue to invest in growth, with on demand retail delivery services MILKRUN & VOLY targeting younger, convenience driven inner city consumers.

This is important for retail suppliers, who products must meet the demands of a distribution channel with significantly different purchasing patterns to traditional bricks and mortar offerings going forward.

With online grocery here to stay, retailers and their suppliers will need to ensure products offerings are optimised to satisfy the online consumer.

Track online food and grocery shopper buying patterns with Freshlogic’s Online Food and Grocery Market insights.

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