Recent forecasts by the Institute of Grocery Distribution (IGD) predict significant growth in online and discount grocery channels worldwide over the next five years.
Economic factors, shifting consumer behaviours, and strategic retailer approaches are set to drive this anticipated surge in both online and discount grocery sectors. According to IGD, online grocery sales are expected to constitute 6.3% of global sales by 2029. At the same time, discount stores, recognised as the fastest-growing physical retail channel, are projected to account for 9.3% of global grocery sales by the end of the forecast period.
While IGD anticipates a steady decline in inflation through 2025, it suggests that developed markets will revert to inflation targets sooner than their developing counterparts. Despite the rise of online and discount channels, IGD forecasts traditional trade will continue to lead globally, contributing 43% of net new sales from 2024 to 2029, although its market share is expected to diminish in most regions.
Supermarkets are projected to remain an important retail avenue, significantly contributing to net new sales despite a gradual reduction in market share. Nick Miles, IGD’s head of global insights, emphasised the need for businesses to understand forthcoming growth areas to appropriately allocate capital, resources, and capabilities to ensure sustained growth.
Miles stated, “While online and discount will be the fastest-growing channels globally, traditional trade and supermarkets will provide the biggest cash growth opportunities. However, channel mix and performance will vary considerably by region and market.”
The IGD’s projections underscore the dynamic shifts occurring within the global grocery retail landscape. Businesses must adapt strategically to capitalise on these developments and ensure their operations align with emerging consumer preferences and market conditions.
