From Clicks to Cart: Online Grocery Drives the Next Wave of Growth

Why It Matters

The rapid acceleration of e‑grocery reshapes supply chains, marketing spend, and competitive dynamics, forcing traditional grocers to double down on digital fulfillment and retail media to retain market share.

Key Takeaways

• Online grocery to hit $452 B by 2028, 25.5% spend share.
• CAGR 11.6% for e‑grocery vs 0.6% in‑store through 2028.
• 80% of fulfillment now shipped/delivered; pickup still key for fresh items.
• Beverages, meat, coffee, prepared foods drive most online grocery revenue.
• Retail media networks used by 38% of retailers, 71% of brands.

Pulse Analysis

The surge in online grocery reflects a broader consumer pivot toward convenience and data‑driven shopping experiences. Analysts attribute the 11.6% compound annual growth rate to tighter integration of mobile apps, seamless checkout, and aggressive last‑mile logistics investments. As shoppers increasingly blend digital and physical touchpoints, the traditional store’s role evolves from a pure transaction hub to a fulfillment and experience center, a shift that amplifies the strategic importance of omnichannel capabilities.

Category performance further clarifies the growth narrative. Beverages, meat, coffee and prepared foods now dominate the e‑grocery basket, accounting for a disproportionate share of revenue despite representing a modest slice of overall grocery spend. Meanwhile, high‑penetration categories such as health‑and‑beauty, baby, and pet care illustrate the platform’s expanding relevance beyond staple foods. Demographically, higher‑income households and Gen Z users lead adoption, while millennials and Gen X leverage digital coupons and loyalty programs, reinforcing the need for personalized, data‑rich engagement.

Retail media networks have emerged as a critical lever for brands seeking visibility in an increasingly crowded online aisle. With 71% of manufacturers and over a third of retailers deploying RMNs, sponsored placements, and programmatic ads now shape purchase pathways on retailer sites and apps. This shift drives a reallocation of marketing budgets toward lower‑cost, performance‑based channels, prompting legacy grocers to invest heavily in proprietary media platforms to protect margin and capture incremental spend. The convergence of rapid fulfillment, category diversification, and sophisticated retail media signals a new growth frontier that will define the competitive landscape for years to come.