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Digital Grocery Expected to Grow in 2023

Grocers poised to overcome challenges in the segment
Emily Crowe, Progressive Grocer
Digital grocery
Some 87% of consumers are expected to use digital grocery in 2023.

Digital grocery is on a roll, and it looks like there are no signs of it slowing down in the coming year. According to the most recent State of Digital Grocery Performance Scorecard from Incisiv and Wynshop’s Grocery Doppio website, shoppers are expected to spend 3% to 7% more on grocery e-commerce in 2023 when compared to 2022, and 87% of shoppers will use digital ordering for grocery purchases.

Grocery Doppio also expects a 16% increase in the number of grocery pickup orders in 2023 over 2022, as well as 67% of grocery shoppers maintaining or increasing their spend on prepared food. While this is the case, grocery spending on technology in the coming year is expected to decrease by nearly 1%.

[Read more: "The Grocer’s Guide to Tech"]

“In the early days of digital grocery’s boom, third-party providers and delivery were very popular with shoppers,” said Gaurav Pant, chief insights officer of both Incisiv and Grocery Doppio. “2022 saw a maturation of both grocers’ ability to sell to their existing shoppers digitally and shoppers’ understanding of what really works for them. I think we will see grocers continue to assume more ownership over digital channels as they grow further in 2023.”

Grocers are expected to seek out better technology platforms in the coming year, especially considering that 73% of store associates are unhappy with their digital tools. Lack of technology talent is the No. 3 challenge facing grocers in 2023, with budget and integration also being concerns.

“Demands on grocers’ technology and talent will increase in 2023 as the global labor shortage continues and digital channels grow further,” said Charlie Kaplan, chief strategy officer of Wynshop. “The key to outperforming the competition is to have flexible, powerful tools which integrate easily and do not require additional skilled workers to operate.”

As for digital performance for November, Grocery Doppio found an improvement in digital basket size – up 12.1% over October. Digital grocery sales also improved by 24.6% compared to October, and 17.1% of all grocery sales in November were digital. The month also saw a 0.5% increase in pickup sales, with 54.2% of all digital orders being pickup.

Third-party transactions in November accounted for 19.7% of all digital grocery sales, which is a 1.2% decrease when compared to October. This also reflects a total loss of more than 8% since Grocery Doppio began tracking in the second quarter of 2022.

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