The Future of Grocery: Online Grocery, Meal Kits, & Direct-to-Consumer Food, 2nd Edition
The future of grocery shopping is increasingly digital. Consumers are looking for convenience in how they get and prepare their foods, and online grocery shopping options facilitate:
- ordering on one’s own time (even outside of store business hours)
- home delivery or appointments for curbside pickup
- access to foods not available locally, including specialty types or foods to suit particular eating habits or allergy limitations
- assistance with meal planning, as platforms suggest combinations and recipes
- assistance with meal preparation, as some formats supply precooked, premeasured, or otherwise semi-prepared meal elements
While the pandemic is receding as a primary driver of habits (as of 2023) and consumers are resuming pre-pandemic activities, online grocery ordering is sticking around. Remote work, both full- and part-time, will continue for the sizable segment of the population that started or expanded the practice during the pandemic. Consumers who used to make purchases during their daily commutes have established new habits – like online ordering – since leaving the home to shop has become less convenient.
With a focus on “what’s next” and current consumer trends, The Future of Grocery: Online Grocery, Meal Kits, & Direct-to-Consumer Food is packed with insights about consumer trends, behavior, and motivations to help food producers, retailers, packaging companies, employers, and investors gauge consumer perspectives and find areas for growth in a competitive market.
The Future of Grocery: Online Grocery, Meal Kits, & Direct-to-Consumer Food delivers actionable predictions and recommendations designed to guide producers, retailers, and investors in making business decisions by providing data and insights about consumer behavior and what consumers think about shopping for groceries online.
Scope
The Future of Grocery: Online Grocery, Meal Kits, & Direct-to-Consumer Food is the go-to source for a complete understanding of US consumer trends regarding food and beverage e-commerce. This report combines Packaged Facts’ extensive monitoring of the food and beverage market with proprietary surveys, and evaluates current trends and future directions for marketing and retailing, along with consumer patterns during the pandemic and across the broader food and beverage market.
This Packaged Facts report analyzes the dynamics of the current landscape of the online grocery and meal kit market. Consumer demographics, perceptions, motivations, and behavior are examined as pertaining to dietary choices and use of food delivery and pickup services. Attitudes on food, diet, health, and product packaging are studied. Effects of recent historical trends on consumers – including the COVID-19 pandemic and the inflation era – are considered in both a broad sense and in the context of the online grocery market.
This report provides information about online retail sales of food and beverages to consumers in the following product categories:
- Shelf-stable foods and beverages in cans, bottles, or other packaging (including alcoholic beverages)
- Meal kits and prepared meals
- Perishables such as fresh fruits and vegetables
- Dairy and egg products
- Meat, poultry, and seafood
- Bakery items
- Frozen foods
- Store-based grocers (e.g., Kroger, Safeway, ALDI)
- Mass merchandisers (e.g., Walmart, Target) and warehouse clubs (e.g., Costco, Sam’s Club, BJ’s)
- Online-based grocers (e.g., Amazon, Thrive Market, Hungryroot)
- Brands that sell their own food products via their websites, direct-to-consumer
- Meal kit and prepared meal delivery services (e.g., HelloFresh, Sakara Life, Factor 75)
- Third-party pack-and-deliver companies that use their own workforce to purchase groceries at various stores and deliver them to customers (e.g., Instacart)
- Local co-ops and farmers’ markets that arrange for subscriptions, single orders, and pickup or delivery digitally
Historical numbers for the online grocery market are provided from 2017 through 2022. Market forecasts are provided for 2023-2027 and 2032.
The online grocery market in 2022 is also segmented by fulfillment type (delivery, pickup/curbside, and shipment), retailer category (grocery stores/supermarkets, mass merchandisers/warehouse clubs, online only retailers, third party pack and deliver services, and farmer’s markets/organics/other), and product category (bakery items, beverages, dairy and eggs, fresh produce, meats and seafood, pantry/frozen, and prepared meals and other foods).
Historical numbers for the meal kit delivery services market are presented from 2019 to 2022. Market projections are provided for 2023-2027 and 2032.
The reasons for and implications of shifts in consumer perception and behavior are analyzed in the context of future market opportunities.
Additionally, The Future of Grocery: Online Grocery, Meal Kits, & Direct-to-Consumer Food has dozens of tables showcasing numerical survey data on consumer demographics and psychographics and numerous marketing photographs. This report goes in-depth on COVID-19 trends affecting the food and beverage market.
Report Methodology
The information contained in The Future of Grocery: Online Grocery, Meal Kits, & Direct-to-Consumer Food was developed from primary and secondary research sources. Primary research includes interviews with food and beverage market experts; participation in and attendance at food industry events; and extensive internet canvassing.
Primary research also includes national online consumer polls of U.S. adult consumers (age 18+) conducted on an ongoing basis by Packaged Facts to analyze attitudes of consumers and their relevant food and beverage preferences.
Survey data from MRI-Simmons are used to analyze the demographics and psychographics of consumers.
Supplementing Packaged Facts’ exclusive survey is analysis of the 2022 Food & Health Survey conducted by the International Food Information Council, which analyzes consumer food purchase decisions, diet and lifestyle choices, snacking activity, and perception of health benefits in foods.
- Executive Summary
- The Future of Grocery Delivery
- Online Grocery Shopping Driven by Convenience
- Expansion of Online Grocery Shopping Led by Third-Party Player Instacart
- COVID-19 and Beyond
- Opportunities for Growth
- Key Consumer Trends
- Scope
- The Future of Grocery Delivery
- Recent Historical Trends from the Pandemic to the Inflation Era
- Highlights
- First Time Use of Online Grocery Shopping and Restaurant Ordering Methods In 2020
- Table Coronavirus Food Ordering Habits: "Because of the coronavirus, I have for the first time used…", 2020 (percent of consumers)
- Boosted Online Grocery Shopping Activity Continued Through 2022
- Activity Spiked in 2020 during the Early Part of the Pandemic
- Table Coronavirus Food Purchase Habits: "Because of the coronavirus, I am…", 2020-2021 (percent of consumers)
- Many Consumers Continued Ordering More Groceries Online in 2021 and 2022
- Frequency of Grocery Shopping: In-Person vs. Online
- Use of Meal Kit Delivery Services
- Activity Spiked in 2020 during the Early Part of the Pandemic
- Many Consumers Are Still Holding off on Dining Out
- Increased Use of Food Carryout and Delivery and Convenience Food Options
- Snacking and Healthy Eating Habits
- Table Coronavirus Eating Habits: "Because of the coronavirus, I am eating more…", 2021 (percent of consumers)
- Concerns about COVID-19 Exposure Have Remained
- Most Still Consider the Pandemic a Health Threat Personally or to Family/Friends
- Table Coronavirus Health Concerns: "I am concerned about the…", 2020-2022 (percent of consumers)
- Concerns about COVID-19 Variants
- Most Still Consider the Pandemic a Health Threat Personally or to Family/Friends
- Rising Prices during the Pandemic
- Many Consumers Are Concerned about Inflation and Rising Food Prices
- Table Consumer Concerns about Rising Food Prices, 2021-2022 (percent of consumers)
- The Vast Majority of Consumers Have Noticed the Rising Cost of Food, and Many Are Changing Their Purchasing Decisions
- Cutting Back on Household Expenses
- Table Consumers Cutting Back on Household Expenses in the Last 12 Months,\ 2022 (percent of consumers)
- Table Types of Household Expenses Cut Back on in the Last 12 Months, 2022 (percent of consumers)
- Many Consumers Are Concerned about Inflation and Rising Food Prices
- Food Shortages during the Pandemic
- Concerns about Food Shortages
- Table Consumer Concerns about Food Shortages, 2021-2022 (percent of consumers)
- Stockpiling of Food and Beverage Items
- Table Consumer Stockpiling of Food and Beverage Products, 2022 (percent of consumers)
- Concerns about Food Shortages
- Negative Personal Effects of the Pandemic
- Negative Effects Reported in 2020 and 2021
- Table Coronavirus Concerns: "The coronavirus has negatively affected my…", 2020-2021 (percent of consumers)
- Continuing Mental and Physical Health Effects
- Stress Levels and Changes Made to Reduce Stress
- Negative Effects Reported in 2020 and 2021
- Pandemic Effects on Work
- Changes to Work Patterns Have Continued in 2021 and 2022
- In-Store Shopping Patterns
- Overview and Market Trends
- Highlights
- The COVID-19 Pandemic Was the Jumpstart the Online Grocery Market Needed
- Convenience the Ultimate Selling Point for Busy Consumers
- US Online Grocery Shopping Well Behind Other Countries, but There Are Opportunities for Expansion and Continued Household Adoption
- Direct Sellers and Home Delivery Companies
- DTC Companies Tackling Niche Health Food Markets with Meal Kits, Prepared Meals, and Online Grocery
- Table Selected Meal, Meal Kit, and Grocery Delivery Services by Date Founded, Services Offered, and Geographic Area Served
- New Companies and Products with Niche Appeal May Choose DTC Channels
- Subscriptions Save Consumers Money and Boost Sales
- Private Labels
- Table Selected Online Private Label Grocery Brands
- DTC Companies Tackling Niche Health Food Markets with Meal Kits, Prepared Meals, and Online Grocery
- Brick and Mortar Stores Expanding and Promoting E-Commerce Options
- Retail Stores Rely More On Impulse Purchases
- Private Label Products Are a Driver of In-Store Traffic, Online Sales, and Retailer Loyalty
- Table Selected Private Label Grocery Brands Available Via Online Ordering
- Launching Online Grocery Shopping Via Third-Party Delivery Companies
- Expanding Direct Grocery Store Ordering Options
- "Dark Stores" or Grocery Fulfillment Centers Can Increase Operational Efficiency
- Third-Party Ordering Platforms Make Offering Online Groceries Possible for Independents
- Table Selected Online Grocery Platform Providers
- Continuing Challenges to Online Grocery Services Satisfying Consumer Desires
- Pickup Can Solve the Last-Mile Problem
- Meal Kit Delivery Services
- Celebrity Endorsements Used as a Marketing Tactic
- Meal Kit Options Targeted at Specific Demographics and Diets
- Increasingly Offering Prepared Ingredients to Save Time and Reduce Mess
- Meal Kits Are Not Just a Product - The Service is Also Like a Home Cooking Class
- Offering Meal Kits Without a Subscription/Via Stores
- Customization of Meals and Varying Levels of Preparation Required
- Lower Priced Meal Kits for Price-Sensitive Consumers
- Meal Delivery Services
- Convenient Meal Delivery Services Emphasizing Freshness and Healthy Foods
- Targeting Specialized Demographics
- Local and Regional Meal Delivery Companies Are Emphasizing Local Ingredients and Compete with National Providers
- Customized Meal Delivery Catering to Special Diets and Weight Loss Plans
- Community Supported Agriculture and Farmers' Markets
- Creating Online Marketplaces and Collaborating with Local Producers
- CSAs Joining the Meal Kit Market Through Partnerships or New Product Offerings
- Concerns about Food Waste
- Most Consumers Are Concerned about Food Waste
- Table Levels of Concern about the Environment and Sources of Food Waste, 2022 (percent of consumers)
- How Consumers Reduce Food Waste
- Imperfect or "Ugly" Produce Has Become an Attractive Option for Consumers, but Food Waste Claims Are Being Re-Examined
- Most Consumers Are Concerned about Food Waste
- Market Size, Forecasts, and Historical Trends
- Highlights
- Scope
- Historical Online Grocery Market
- Table US Online Grocery Sales, 2017-2022 (billion dollars)
- Share of the Market by Fulfillment Type
- Share of the Market by Retailer Category
- Share of the Market by Product Category
- Online Grocery Forecast
- Table US Online Grocery Sales, 2022, 2023P-2027P, 2032P (billion dollars)
- Meal Kit Forecast
- Table US Meal Kit Delivery Service Sales, 2019-2022, 2023P-2027P, 2032P (million dollars)
- Use of Food Ordering Methods and Online Food Purchases
- Highlights
- Use of Food Delivery and Pickup Options
- Most Consumers Have Used A Food Delivery or Pickup Service in the Last 12 Months
- Table Use of Food Delivery and Pickup Options in the Last 12 Months, 2023 (percent of consumers)
- Strong Overlap Between Use of Services
- Table Strong Overlap in Use of Food Delivery and Pickup Options in the Last 12 Months, 2023 (percent of consumers)
- Most Consumers Have Used A Food Delivery or Pickup Service in the Last 12 Months
- Purchases of Meal Kits and Prepared Meals from Retailers in the Last 12 Months
- Table Purchases of Meal Kits and Prepared Meals from Retailers in the Last 12 Months, 2023 (percent of consumers)
- Frequency of Using Convenient Food and Food Ordering Methods in the Last 3 Months
- Table Frequency of Using Convenient Food and Food Ordering Methods in the Last 3 Months, 2023 (percent of consumers using each service in the last 12 months)
- Table Frequency of Using Convenient Food and Food Ordering Methods in the Last 3 Months, 2023 (percent of consumers)
- Changes to the Frequency of Using Convenient Food and Food Ordering Methods Now Compared to 12 Months Ago
- Table Changes to the Frequency of Using Convenient Food and Food Ordering Methods Now Compared to 12 Months Ago, 2023 (percent of consumers using each service in the last 12 months)
- Use of Online Grocery Ordering/Delivery Services
- Table Online Grocery Ordering/Delivery Services Used, 2023 (percent of consumers)
- Online Purchases of Alcoholic Beverages
- Table Alcoholic Beverages Bought Online, 2023 (percent of consumers)
- Use of Meal Kit Delivery Services
- Table Use of Meal Kit Delivery Services, 2023 (percent of consumers)
- Growth Opportunities
- Highlights
- Targeting Baby Boomers and the Silent Generation, Who Are Less Likely to Shop Online
- Online Grocery Shopping Can Solve Problems Faced by Older Consumers
- Meal Kits and Prepared Meals for Older Consumers
- Expansion of Meal Delivery Options for Children and Families
- Appealing to Customers Trying to Resist Impulse Buys
- Further Acceptance of the Outsourcing of Individual Item Selection
- Label Readers Can Get Additional Product Information Online
- AI-Powered Voice Technology for Increased Convenience
- VR and AR Shopping Experiences
- Artificial Intelligence for Video Marketing, "Shoppable Videos", and Improving the Shopping Experience
- Micro-Fulfillment Can Boost Profits and Delivery Speeds
- Robotics and Fulfillment Automation
- Delivery Via Drones or Autonomous Vehicles
- Creating a Seamless Omnichannel Experience
- Target Special Occasions to Interest Infrequent Customers
- Offering Expiring/Clearance Items for Sale Online
- Meal Kits and Prepared Meal Delivery Services Can Reduce Food Waste at Home
- Online Grocery, Meal Kit, and Meal Delivery Service Providers
- Highlights
- Mergers & Acquisitions
- Table Selected Online Grocery Mergers & Acquisitions, 2021-2022
- Venture Capital Stimulating Startups, Though Consolidation is Afoot as Some E-Grocers Are Struggling
- Table Selected Investment in Online Grocery and Related Companies, 2019-2023 (million dollars)
- Online Grocery Market Share
- Instacart
- Walmart
- Amazon
- Kroger
- Target
- Ahold Delhaize
- Meal Kit Delivery Services Market Share
- HelloFresh
- Home Chef
- Sunbasket
- Blue Apron
- Competing Products and Services
- Home Chef Services Compete with the Meal Kit and Meal Delivery Concept
- Restaurant Delivery from Third Parties
- Consumer Demographics
- Highlights
- Trends by Gender
- Table Use of Online Grocery and Meal Kit Delivery Services by Gender, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Gender, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Gender, 2023 (percent of consumers using each service)
- Trends by Age
- Table Use of Online Grocery and Meal Kit Delivery Services by Age Bracket, 2023 (percent of consumers)
- Table Use of Online Grocery and Meal Kit Delivery Services by Generation, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Age Bracket, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Age Bracket, 2023 (percent of consumers using each service)
- Patterns Based on Household Income
- Table Use of Online Grocery and Meal Kit Delivery Services by Household Income Bracket, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Household Income Bracket, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Household Income Bracket, 2023 (percent of consumers using each service)
- Regional Differences
- Table Use of Online Grocery and Meal Kit Delivery Services by US Region, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by US Region, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by US Region, 2023 (percent of consumers using each service)
- Urban, Suburban, and Rural Consumers
- Table Use of Online Grocery and Meal Kit Delivery Services by Population Density of Residence Area, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Rural, Suburban, and Urban Living Environment, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Rural, Suburban, and Urban Environment, 2023 (percent of consumers using each service)
- Educational Attainment
- Table Use of Online Grocery and Meal Kit Delivery Services by Educational Attainment, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Educational Attainment, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Educational Attainment, 2023 (percent of consumers using each service)
- Employment Status
- Table Use of Online Grocery and Meal Kit Delivery Services by Employment Status, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Employment Status, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Employment Status, 2023 (percent of consumers using each service)
- Presence of Children in the Household and Marital/Partnership Status
- Table Use of Online Grocery and Meal Kit Delivery Services by Presence of Children in the HH and Marital/Partnership Status, 2023 (percent of consumers)
- Table Use of Online Grocery and Meal Kit Delivery Services by Age and Number of Children in the HH, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Presence of Children in the HH and Marital/Partnership Status, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Age of Children in the HH, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Presence of Children in the HH and Marital/Partnership Status, 2023 (percent of consumers using each service)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Age of Children in the HH, 2023 (percent of consumers using each service)
- Race/Ethnicity
- Table Use of Online Grocery and Meal Kit Delivery Services by Race/Ethnicity, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Race/Ethnicity, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Race/Ethnicity, 2023 (percent of consumers using each service)
- Plant-Forward Consumers
- Table Use of Online Grocery and Meal Kit Delivery Services by Primary Diet/Eating Philosophy, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Primary Diet/Eating Philosophy, 2023 (percent of consumers)
- Table Use of Convenient Food Ordering Methods More Often Compared to 12 Months Ago by Primary Diet/Eating Philosophy, 2023 (percent of consumers using each service)
- Consumer Psychographics
- Highlights
- Strong Overlap with Clean Label Ideals
- Table Use of Convenient Food Ordering Methods in the Last 12 Months by Clean Label Preferences, 2023 (percent of consumers)
- Table Frequent Use of Convenient Foods and Food Ordering Methods in the Last 3 Months by Frequency of Adhering to a Clean Label Diet, 2023 (percent of consumers)
- Food Attitudes
- Table Consumer Food Attitudes and Behaviors, 2023 (percent of consumers who agree completely)
- Attitudes on Food Convenience and Being Busy
- Table Consumer Attitudes on Food Convenience and Being Busy/Stressed, 2023 (percent of consumers who agree completely)
- Grocery Shopping and Meal Planning Behavior
- Willingness to Pay More for Convenient Food Delivery or Premium Foods
- Special Diets/Eating Restrictions/Food Preferences
- Table Following Special Diets/Eating Restrictions/Food Preferences Always or Almost Always by Use of Convenient Food Ordering Methods in the Last 12 Months, 2023 (percent of consumers)
- Reasons for Consumers Ordering Groceries or Meal Kits Online
- Table "Why do you order groceries online (either for pickup or delivery)?", 2023 (percent of consumers who use grocery delivery or pickup services)
- Table "Why do you have fresh ingredient meal kits delivered?", 2023 (percent of consumers who use meal kit delivery services)
- Why Do So Many Online Shoppers Not Shop for Groceries or Meal Kits Online?
- Table "Why do you not have food or beverage groceries delivered?", 2023 (percent of consumers who do not use grocery delivery services)
- Table "Why do you not have meal kits delivered?", 2023 (percent of consumers who do not use meal kit delivery services)
- Packaging Trends
- Highlights
- The Balance Between Effective, Sustainable, and Low-Cost Packaging
- Targeting Excessive Packaging for Reduction and Elimination
- Protective Packaging Is Important For Product Integrity
- A Shift from Expensive Set-Up Boxes to Other Paper Packaging
- Reusable Packaging
- Opportunities for Biodegradable and Compostable Packaging
- Consumer Insights on Recycling, Household Waste, and Packaging
- Recycling and Household Waste
- Table Consumer Opinions on Recycling and Household Waste, 2023 (percent of consumers who strongly agree)
- Access to and Use of Curbside/Residential and Drop Off Recycling Services
- Table Consumer Access to Curbside/Residential and Drop Off Recycling Services, 2023 (percent of consumers)
- Table Consumer Frequency of Using Curbside/Residential and Drop Off Recycling Services, 2023 (percent of consumers with access to each service)
- Opinions on Packaging Materials
- Table Consumer Opinions on Packaging Materials, 2023 (percent of consumers who strongly agree)
- Sustainable/Eco-Friendly Packaging Types Consumers Look for
- Table "Do you especially look for any of the following in terms of "sustainability" or "eco-friendly" packaging?", 2023 (percent of consumers)
- Packaging Types Considered Eco-Friendly
- Table "Which packaging types would you consider eco-friendly?", 2023 (percent of consumers)
- Priorities Placed on Food Packaging Features
- Table Priorities Placed on Packaging Features for Food Products, 2023 (percent of consumers)
- Opinions on Food Packaging
- Table Consumer Opinions on Food Packaging, 2023 (percent of consumers)
- Recycling and Household Waste
Research Assistance
Download our eBook: How to Succeed Using Market Research
Learn how to effectively navigate the market research process to help guide your organization on the journey to success.
Download eBook