Xin Ou
Research expert covering Greater China
Online grocery shopping in India - statistics & facts
The days of going outside to buy groceries from the closest kirana (mom-and-pop store) are long gone as groceries and snacks can now be delivered at the gentle push of a button. Grocery expenditure accounts for nearly 20 percent of India’s economy. Urban middle-class families are addicted to online shopping thanks to a year of intense marketing, big sales from e-commerce companies like Amazon and Flipkart, and COVID-19 pandemic-related lockdowns. The market value of online groceries across the country was estimated to be over one trillion Indian rupees in 2024.
We cannot grasp a full picture of the Indian online grocery market without fully understanding traditional grocery retail, the currently dominant grocery model in India. Over 95 percent of Indian grocery stores are made up of kiranas, whereas supermarkets account for about four percent and online groceries not even near one percent. About two-thirds of India’s population resides in rural areas that are largely unaffected by modern retail forms and prefer shopping through local kirana stores.
Online grocery retailers offer more convenience, competitive pricing, and discounts compared to local kirana stores. They also often have chatbots for better customer support. In addition, they provide flexible delivery options like same-day, scheduled, or slotted deliveries, which are essential for consumers with busy lifestyles. Further, the adoption of quick commerce has changed the online grocery landscape in the country.
For the first time, quick commerce has begun to interfere with kirana's spending. The quick commerce market is set to reach over five billion U.S. dollars by 2025 in India. The fast delivery approach of q-commerce sets it apart from the most conventional e-commerce setup. Additionally, a major food aggregator like Zomato has adopted the q-commerce strategy. The incorporation of new technologies such as delivery through drones, electric vehicles, voice ordering, and automation of dark stores will likely lead the market to rapid expansion in the future.
We cannot grasp a full picture of the Indian online grocery market without fully understanding traditional grocery retail, the currently dominant grocery model in India. Over 95 percent of Indian grocery stores are made up of kiranas, whereas supermarkets account for about four percent and online groceries not even near one percent. About two-thirds of India’s population resides in rural areas that are largely unaffected by modern retail forms and prefer shopping through local kirana stores.
Traditional vs. online grocery retail
Both traditional and online grocery platforms are adapting and evolving according to changing consumer preferences. Traditional grocery stores are embracing digital payments such as mobile wallets, QR codes, and UPI for cashless transactions. Moreover, retailers now offer digital loyalty cards and customized offers to increase consumer retention. Although kirana stores are embracing technology, they continue to rely on their traditional strengths such as enduring relationships with consumers, bargaining, and the ability to offer credit.Online grocery retailers offer more convenience, competitive pricing, and discounts compared to local kirana stores. They also often have chatbots for better customer support. In addition, they provide flexible delivery options like same-day, scheduled, or slotted deliveries, which are essential for consumers with busy lifestyles. Further, the adoption of quick commerce has changed the online grocery landscape in the country.
Rapid rise of quick commerce
Since most grocery products are perishable, companies have begun creating a rapid commerce, or q-commerce, model for fast supermarket deliveries. Major online market players such as BigBasket, Blinkit, Swiggy Instamart, and Jio Mart are now using quick commerce to deliver groceries within 10 to 20 minutes to customers.For the first time, quick commerce has begun to interfere with kirana's spending. The quick commerce market is set to reach over five billion U.S. dollars by 2025 in India. The fast delivery approach of q-commerce sets it apart from the most conventional e-commerce setup. Additionally, a major food aggregator like Zomato has adopted the q-commerce strategy. The incorporation of new technologies such as delivery through drones, electric vehicles, voice ordering, and automation of dark stores will likely lead the market to rapid expansion in the future.
