May 28, 2020
The online grocery delivery penetration in total grocery market is expected to increase to ~25% by the end of 2025.
o Average Order Size & Basket Size increased to AED 180-200 and 15-20 items respectively in 2020 owing to the corona pandemic.
o Technological development such as drone deliveries, warehouse automation, and voice orders are anticipated to be adopted by service providers to enable quicker deliveries.
Impact of Covid-19: Companies witnessed double-digit growth across all essential product categories namely water, fresh fruits, vegetables, health & nutrition, cleaning, dishwashing & laundry products during the corona pandemic. Companies experienced a surge in average order size as customers were shopping in bulk. The average delivery time also increased to four to seven days. In order to fulfill the increased demand, companies expanded their delivery fleet by partnering with third-party delivery companies to manage last-mile logistics. In addition to this, in Abu Dhabi and Dubai, companies partnered with taxi fleets to take care of door-to-door delivery.
Expanding Partnerships: It is anticipated that companies would be expanding tie-ups with suppliers & grocery stores, food delivery companies, e-wallet companies to leverage their capabilities to fulfill customer orders. Introduction of express delivery, regional expansion, diversification of product portfolio, focus on achieving operational efficiency, and establishment of the dark stores are the future strategies adopted by the companies.
Application of AI: Drone Technology, Voice Ordering, Artificial Intelligence, Warehouse Automation is anticipated to drive the online grocery delivery market in the future. Incorporating AI in the front end would enable the company to create a personalized shopping experience for the customer. Demand prediction and consumer behavior analysis is crucial to ensure sufficient availability of products and to maintain minimum wastage.
According to the report by Ken Research titled "UAE Online Grocery Market Outlook to 2025- Market Driven by Increasing Working Population, Introduction of Express Delivery and Regional Expansion" the Online Grocery Delivery Market will be valued at AED 3.8 Billion by the end of 2025. The market will witness growth owing to the introduction of subscription models & innovative strategies adopted by service provides.
For More Information on the Research Report, refer to below links: -