India's online grocery market to reach $24 billion by 2025

The entire e-grocery market in India is expected to reach $24 billion GMV by 2025 , of which 55 % will be contributed by households that prioritize value for money ( understandably middle- and low-income households ) , RedSeer said in its latest report released on Thursday .

India has a low per capita income level, with low- and middle-income people accounting for the majority of the total population. For Indian families , affordability is a key issue, so cost-effectiveness is the primary factor they consider, and cheap food and groceries are their first choice.

Data collected in the report show that Indian households that prioritize value for money contribute 61% of the grocery retail market , close to two-thirds of the grocery market, and are the main contributors to the Indian grocery market. In the next five years, India's value-for-money grocery e-commerce market is expected to grow at a rate of 53%, faster than the overall online grocery market's compound annual growth rate of 48% .

Currently, India's grocery market is worth $500 billion. Before the pandemic, most Indian households used to buy groceries through offline channels, but the pandemic lockdown has led them to start buying daily necessities and other grocery items on e-commerce websites and apps.

The report's survey results show that more than 50% of India's traditional grocery retail can be replaced by online platforms. Grocery e-commerce platforms can provide most of the goods people need in their daily lives, and online grocery shopping may become the mainstream in the future.

In addition, the Indian government is also vigorously promoting the digital transformation of domestic physical grocery stores, which will also drive the rapid growth of India's online grocery market.

India's online grocery market is developing rapidly, and sellers can pay more attention to this market. Although fresh food and other products are the most popular products on India's grocery e-commerce platforms, survey data show that the demand for daily necessities and fast-moving consumer goods such as personal care products, household hygiene products, and household items is also growing. Sellers can start with relevant sub-categories to enter India's grocery market.

E-commerce market

E-commerce platform

Cross-border e-commerce