Online grocery to become largest ecommerce category in US by 2026 - JPM
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ONLINE GROCERY TO BECOME LARGEST ECOMMERCE CATEGORY IN US BY 2026 - JPM
Grocery is expected to become the largest e-commerce category by 2026 in the United States, where retail giant Walmart WMT.N currently retains a dominant position, according to analysts at J.P. Morgan.
The brokerage said that as online grocery penetration increases over time, the category will bring billions to the e-commerce market and make up the largest e-commerce category from a sheer volume perspective.
"We believe Walmart will continue to be the leader in the space as it invests in e-commerce capabilities while maintaining its market share of overall grocery as the category becomes further penetrated online," J.P. Morgan analysts said in a note.
Currently, Walmart has a 27% market share in the space, followed by e-commerce giant Amazon.com AMZN.O and delivery firm Instacart CART.O with 20% and 19%, respectively, according to the brokerage.
Grocery is expected to make up 19% of U.S. e-commerce sales by 2026, J.P. Morgan analysts said, citing market research firm Emarketer's data, and is likely to outgrow apparel, followed by consumer electronics, and home furnishings during the same period.
U.S. online spending has been experiencing a rebound, spurred by higher gas prices, convenient delivery options and an increase in online offers following a brief post-pandemic slump, the country's top retailers have said in recent weeks.
E-commerce sales have made up 15.9% of total U.S. retail sales in the first quarter, the highest since they peaked at 16.4% during the height of the pandemic in 2020's second quarter, according to Department of Commerce data.
Walmart reported a 22% surge in U.S. online sales last month, surpassing its 17% growth seen during the holiday season.
The retail bellwether's shares have been up more than 25% this year, compared to Amazon's 21% rise and Instacart's over 40% advance, as of the last close.
(Granth Vanaik)
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