Home Business Online grocery to become $18bn industry in India by 2024: Report

Online grocery to become $18bn industry in India by 2024: Report

As companies from Reliance to Amazon put their top dollar in serving daily grocery at your doorstep, a new report said on Friday that online grocery is going to be the next battleground for growth, expanding to over $18 billion by 2024.

According to a joint report by a joint initiative by Bengaluru-based market consulting firm RedSeer and Bigbasket (Brand Intelligence), driven by the significant rise in organic adoption during Covid-19, grocery has been on a surge with clocking 1.7 times in gross merchandise value (GMV) in June this year as compared to January.

The online grocery will remain steady for the rest of the year to reach more than $3 billion, the report mentioned.

“The industry has seen more than 70 percent ARR (annual recurring revenue) jumps in the last quarter across categories. This brings the opportunity to serve a larger set of customers and some challenges with it,” said Hari Menon, co-founder, and CEO of BigBasket.

The report found that demand for comfort foods like noodles and cookies, immunity boosters like lemon, and hygiene products like sanitizers picked up after the pandemic while essentials remained strong.

Snacks and branded foods grew by 5 percent quarterly pre-COVID, however, growth jumped to 75 percent in the June quarter.

Within snacks and branded foods, biscuits and cookies were the largest sub-category and grew the most in Q2.

Beverages grew by 2 percent quarterly pre-COVID, however, growth jumped to 50 percent in Q2.

“Personal Care grew by 5 percent quarterly pre-COVID but jumped to 24 percent in Q2 due to COVID.

“We have observed that traditional brands which pivoted quickly to be digitally ready brands have seen 2x+ jump in sales compared to offline brands. We are excited to have this opportunity to serve the ecosystem,” said Anil Kumar, founder, and CEO of consulting firm RedSeer.

Home utilities grew by 6 percent quarterly pre-COVID but jumped to 11 percent in Q2.

Within home utilities, detergents and dishwasher were the largest sub-category but grew the least in the last quarter.

According to the report, home utilities were not severely affected by the pandemic.

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