Amazon is rolling out free grocery delivery to Prime members, raising the bar at a time when competition is already at a high point.
In just the last year, online grocery shopping has soared from 38 percent to 56 percent,While it still represents only 2 percent of the market, it’s the fastest-growing e-commerce category, at around 18 percent, according to the e-commerce research firm eMarketer.
“The whole market is at an inflection point and there is some evidence of hockey stick growth in adoption of online grocery [in 2019],” Andrew Lipsman, a principal analyst with eMarketer, told NBC News. “The proverbial millennials have families now, so we have online habits but we’re at a totally different life stage. We’re not fresh out of college anymore.”
Instacart, which offers third-party delivery services for stores like Costco, Wegmans, and Aldi, leads the pack in growing its market share of grocery delivery, according to the consumer research group Edison Trends. Instacart has grown its market share to 69 percent in the last year, while AmazonFresh dropped its market share from 14 percent to 9 percent this year, according to Edison Trends. Walmart has also grown in the online grocery industry, with its buy online and pick up in-store option.
As in many cases, Amazon's competitors may be left in the dust. Walmart’s unlimited delivery subscription currently costs $98 a year, or $12.95 on a monthly basis. Shipt costs $99 for an annual unlimited delivery membership. Target offers unlimited Shipt deliveries over $35 for $99 a year. Instacart charges $99 for an annual unlimited free delivery membership.
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