Online grocery's staying power
Online grocery was a minuscule part of food retail before the pandemic. Now, about 60% of U.S. consumers have bought groceries online in the last 12 months, and most of them plan to keep doing so post-pandemic, according to a report from Coresight Research.
Why it matters: The rise of online food shopping is leaving behind smaller chains or mom-and-pop grocers that can't afford to offer delivery — turning grocery into a survival of the biggest players.
- It's also fueling the creation of more gig jobs, as companies like Amazon, Walmart and Instacart search for workers to feed the spiking delivery demand.
- All this is strengthening the pandemic-induced stay-at-home economy — one which deepens the U.S.'s economic divide.
What's happening: The online grocery market swelled to $55.5 billion in 2020, an 81% increase from 2019, per Coresight, and that growth is expected to continue — albeit to a lesser extent — in 2021.
One of the big drivers of growth in the grocery delivery market is older customers, experts say.
- "We’ve had reluctant tech adopters forced to adopt tech in ways that they wouldn’t have done in years or ever," says Betsey Stevenson, a University of Michigan economist.
- According to Coresight's survey, 62% of current online shoppers between the ages of 45 and 60 and 55% of those over the age of 60 plan to continue to use those services as frequently or more frequently after the pandemic.