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Five-fold growth ahead for China online grocery market

China online grocery sales are predicted to grow five-fold between now and 2020 – from the current $41 billion to about $180 billion.

A reported by IGD Research says China is already the largest market in the world for online grocery sales and by 2020 it will be worth about $70 billion more than the other top nine global online markets combined.

China online grocery spending will dwarf that of the second largest market – the UK – which will be worth just $28 billion.

IGD CEO Joanne Denney-Finch says the massive Chinese growth will be driven by more people in China having access to the internet both through smartphones and other devices.

“Given the size of its population, even a small change will have a significant impact,” she says.

“Most online sales in China take place through digital marketplaces, such as Alibaba’s business to consumer site Tmall. These allow international retailers without stores in China to gain instant access to new customers and tap into the booming Chinese market with limited investment.

“Other international retailers, as well as local players, are also launching their own online and mobile grocery shopping sites. Food is seen as an affordable luxury, with foreign brands popular with Chinese shoppers wary of the safety scares surrounding locally sourced food and drink. To cater for this demand, companies such as Alibaba and Amazon have recently introduced dedicated sites for imported goods.”

Denney-Finch says many Chinese people also prefer shopping using their smartphones, so retailers are offering mobile-only promotions which are updated regularly to encourage shoppers to keep visiting their websites for the latest deals.

She says worldwide there will be significant growth across the top 10 online grocery markets.

“This is being driven by busy shoppers making the most of more digital technologies and the rising trend of ‘anywhere, anytime shoppers’. They add to their online shopping basket over a period of time on whichever device is most handy at that moment.

“New innovations, such as grocery delivery services from Instacart and Uber, are also helping to support online’s rapidly increasing popularity by providing convenient time-saving solutions.”

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