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1995 saw the first-ever food e-commerce business, World Wide Waiter, offering its online food ordering services in northern California and later expanding to other US cities. Since then, the industry has evolved at a stellar pace and skyrocketed in 2020 during the pandemic.
According to McKinsey & Company,
“The pandemic essentially squeezed ten years of digital sales penetration into three months.”
A recent survey predicts that revenues in the online food delivery market will hit the $1.22 trillion mark in 2024. With massive room for further growth and expansion, this industry's entrants must follow all the latest trends to gain a competitive edge.
In addition to this, following the latest online commerce business trends will equip entrepreneurs, like yourself, with more in-depth data on e-commerce shopping experiences, customer behaviours, conversions, and brand image. This data can then be evaluated to assess the most and least successful strategies for your specific business and future goals.
If you’re considering starting a food e-commerce business and want to make informed decisions based on recent trends, this article will prove to be a valuable stepping stone. But don’t take our word for it. Take a look at our comprehensive list yourself!
Interesting Food E-Commerce Business Stats To Know
Between 2019 and 2022, the foods and beverages sector saw a compound annual growth of 32.2%. This number was staggering as it crossed the health and beauty sector as the second-fastest-growing category with an annual growth of 26.1%.
In the post-pandemic phase, the industry is still seeing steady growth with a 3.4% increase in 2022. During the same year, online sales in this category grew by 8%, which was higher than the combined sales of brick-and-mortar and online sales at 7.6%. It was also higher than the increase seen across all category sales, which stood at 5.1%.
Also owing to the pandemic, the food e-commerce business’s target audience has become ageless. Even those who had never purchased food online have started doing so. In fact, more than a quarter of online grocery shoppers were above the age of 55 in 2021.
The online food delivery market is expected to reach $1.22 trillion in terms of revenue in 2024, with a 9.49% growth rate and a projected market volume of $1.92 trillion by 2029. The following are some other key stats to know.
- A revenue growth of 20.3% is expected for the grocery delivery market in 2025.
- This market is also projected to enjoy a market volume of $0.78 trillion in 2024.
- China is expected to become a global leader in terms of revenue with an expected revenue of $448.9 in 2024.
- The grocery delivery market is expected to amass an average revenue per user of $452.4 in 2024.
- In 2024, the number of users in the meal delivery market is expected to reach 2.8 billion with 29.8% user penetration.
Starting your very first online e-commerce store? Seek the help of qualified experts to get everything right from the get-go!
11 Online Commerce Business Trends Ft. The Food Industry
Online commerce businesses that sell food and beverages online feature numerous products ranging from everyday groceries to unique speciality items. Time management and efficient delivery, which many other online stores may get away with overlooking, are an absolute must for food e-commerce sites selling perishable items.
Regardless of the product selection in an online e-commerce store, these trends will prove advantageous to all in the food and beverages market.
1. Niche Products
Some customers pick certain online e-commerce stores for morality reasons. For example, they may shop from small businesses to support and help grow them. Others may select brands for more specialised and personal reasons. For example, they may shop from a brand offering keto-friendly food and beverages to fulfil their dietary needs.
Food e-commerce is in a unique position here with the former reason applying to almost all e-commerce stores and the latter reason presenting exclusive opportunities.
You can focus on uncommon, difficult-to-source items to make an impact on your e-commerce store. Things like vegan, cruelty-free, and gluten-free products can help attract users of such niche products, who may also browse and shop other listed products on your website.
You can introduce and showcase such speciality products through welcome emails and customer segmentation. Those customers who have previously purchased a niche product from your store can be targeted with specially catered post-purchase emails. For a tailored buyer experience that increases engagement, you should also market new related products in this same way.
2. Cross-Selling
There are times when you won’t need to put in much effort to close a sale on your food or beverage items because it’s exactly what your customers need. However, oftentimes, you’ll find that most customers need further enhancements, enrichment, or a complementary product to make the most out of specific purchases.
To successfully cross-sell a product to your customers, you must concurrently introduce it to your online e-commerce store’s shoppers while they’re still in the process of making a purchase. You can also offer a combination of your listed products through emails or strategically present them on your website.
It’s vital to handle cross-selling for food e-commerce correctly, otherwise, you lose not only your sales but also audience engagement. Consider adding relevant product recommendations based on your customer’s past purchases, current viewings, and products already added to the cart. You can also promote special or endorsed items that you know will enhance your customer’s e-commerce shopping experience.
3. Personalisation
Most commerce sites know the importance of personalisation and specifically of product recommendations within this niche. As a food e-commerce business, you’ll have endless possibilities to provide customers with customised products.
For example, many bakeries are now offering custom-made cakes for various occasions. You can personalise everything from their standard cakes to novelties and luxury items. Such hyper-personalised items are highly attractive, specifically for first-time buyers.
For products such as personalised cakes that are only reserved for specific celebrations, it’s also important to remember that you won’t need to engage and retarget your previous buyers for at least a year. It’s vital to time your communication strategically to maximise your rate of success and engagement opportunities.
Take your personalisation efforts a step further. Schedule a call with our experts to learn how!
4. Subscriptions & Restocking
A renewal or subscription model is perfect for food e-commerce businesses that deal with perishable items. Repeat purchases, discussed next, are a result of post-purchase marketing tactics that encourage customers to return and make similar purchases from your online e-commerce store.
However, having an automated process in place will ensure your customers enjoy a seamless e-commerce shopping experience and your business enjoys a higher frequency of repeat orders. You can give your customers the option to select products they want delivered regularly or choose from curated options. They should also be given the ability to select the cycle, ranging from once every month for three months to once a month indefinitely.
5. Quick Repeat Purchases
Retention marketing’s primary cornerstone is targeting prior customers, which isn’t new. Food and beverage e-commerce businesses can especially thrive more using this marketing strategy, as it can help them address the limited shelf life problem of their products.
Once your customers buy a perishable item, they will likely finish it soon after receiving it as they’re meant to be consumed when fresh. Consequently, they’ll likely return for a repeat purchase much sooner than they would for non-perishable items. This gives food and beverage e-commerce businesses a massive advantage, making it easier for them to transform their one-time buyers into long-term repeat customers.
The potential for greater engagement coupled with the DTC model makes this process a lot quicker. You can also utilise other strategies, such as promotional emails, to grow your subscriber list, improve conversion lists, and encourage faster repeat orders.
6. Special Deliveries
As mentioned earlier, efficient delivery has always been a crucial aspect of the food e-commerce business. What’s new is that online commerce businesses are now working towards making them even quicker and more direct. We’re talking about same-day, instant delivery options.
For more expedient and direct-to-customer delivery, you can consider partnering with delivery companies, such as Uber, that can match the needs and expectations of your customers.
7. Luxury Products
Some audiences expect nothing but the best of the best out of their e-commerce shopping experiences. Such buyers don’t mind paying a premium price for the finer things in life. However, this doesn’t mean you should solely focus on this specific audience for your food e-commerce business.
Some buyers who prefer to steer clear of food and drinks with relatively higher price tags typically make an exception for a special occasion. These luxury products, such as unique chocolates and rare spirits, make for an ideal gift choice for loved ones whom the audience finds difficult to shop for.
Telling your brand’s story, explaining why you chose to feature the listed luxury products, and what makes these products special will all be a part of an efficient and effective marketing strategy.
Focus on sharing your unique value proposition that helps your brand stand out amongst the competition selling similar high-end luxury products. Are you using certain unique ingredients, such as near-extinct cacao for your chocolate, that no other brand is using? If so, make sure your audience knows.
All of this messaging can be presented in a brand-focused welcome series that tells your brand story and, consequently, increases your conversion rates.
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8. Omnichannel Marketing
Omnichannel marketing offers food e-commerce businesses numerous opportunities to boost their sales. It uses multiple interconnected channels, such as push notifications, SMS, and emails, to communicate with target audiences. If you’ve ever received cart abandonment SMS reminders or emails, you’ve experienced omnichannel marketing as a customer.
Your omnichannel marketing can include the following:
- Push notifications for reviews and photos
- Post-purchase discounts via social media or email
- Social media ads
- SMS notifications announcing new product launches
At the heart of this marketing strategy are integrated experiences that offer customers a more engaging e-commerce shopping experience that is beneficial to both them and your business. Here’s how you can use omnichannel marketing for your food e-commerce business:
Social Media
Offering light and fun engagement with customers and a platform to share important news, social media is a great outlet for advertising products. You can work with influencers or customers to create effective and organic engagement.
SMS
SMS marketing is often underrated but it’s best not to undermine this simple tool’s power. When used in tandem with other marketing approaches, it can prove to be a perfect addition to traditional email marketing. You can use SMS marketing to casually remind your customers about their abandoned carts or deliver extra incentives during holiday promotions.
Typically, SMS is best for gentle reminders and a soft push. Alternatively, emails are generally used for more heavy-handed marketing techniques.
Emails
You can reach out to your customers with various email marketing campaigns after they sign up for notifications or deals or make a purchase using their email address. Your emails can include messaging surrounding abandoned carts, personalised recommendations, or simple welcome messages.
You can combine automated email campaigns, which have shown incredible results, and customer segmentation to save time and effort. Moreover, in addition to cart abandonment and post-purchase emails, you can also create email campaigns dedicated to annual occasions.
Website
A well-designed website may even work more efficiently than email marketing for customer engagement and conversions with the endless marketing opportunities available. You can take advantage of several website elements, such as CTAs, banner ads, and pop-ups, to communicate with your customers.
For example, you can add a live pop-up for visitors on your website informing them of each purchase made while they’re browsing products. This pop-up will prove to visitors that others are showing an interest and engaging with the store as well. It’s also a great opportunity to highlight the prime as well as the lesser-known products on your website.
In addition to this, you can utilise push notifications to improve your customer’s buying journey by alerting them of new products, time-sensitive offers, and upcoming sales.
9. Digital Ecosystems
Modern consumers require quality services, and this not only includes an effective delivery tool but also online platforms and ecosystems. For example, if you’re running a restaurant app, offer your customers a little more than ready-made dishes to order. Your app can create interest-based communities, act as a space to share recipes and dishes, and a tool to book a table at your restaurant.
The app can integrate cooking tutorials from the head chef or function as a food subscription service. Many e-commerce businesses are also using their apps to sell thematic products, such as unique kitchenware, tableware, and farm products.
Want to create an interactive website that helps boost engagement and conversions? Let us help you!
10. VR & AR
VR and AR technologies are being integrated into marketing campaigns to increase customer engagement and brand loyalty. For example, Lidl has introduced an app offering its users AR-based games and exclusive offers. Users can win bonus points or discounts, which encourages interaction with the brand and increases the average purchase amount.
Kellogg's has also developed a VR program which allows users to explore all the farms from where they source their ingredients for products. This invention gave the brand’s customers a new sense of connection and level of trust, leading to a 34% increase in sales during the advertising campaign.
11. Chatbots
Chatbots enable both users and the company to save time and resources. Customers can simply submit a request to these bots instead of playing with filters on the website to find relevant products. Most of your customers will likely have no time or desire to browse through your entire product catalogue, and chatbots can greatly simplify such tasks.
However, it’s vital to remember that not all of your customers will be tech-savvy enough to navigate the different types of websites. So, they may spend a lot of time searching for their desired products. This is especially true for companies that prioritise design and uniqueness over user experience.
Integrating chatbots into your website will significantly optimise the speed of responses from technical support and sales departments, consequently impacting user experience. It’s important to remember that in today’s fast-paced digital world, you may end up with abandoned carts even if your customers are required to wait for a mere 2 to 3 minutes.
Food & Beverage Businesses To Follow
The following are some food e-commerce businesses that have and continue to make history.
- Dandelion Chocolates: A bean-to-bar chocolate company that offers unique, high-end chocolate products while pushing the boundaries of confectionery.
- The Caker: Initially an at-home food business, The Caker offers pre-assembled kits for bakers to make cakes from scratch.
- Storm and India: An Australian organic tea company that supplies customers with tea-making accessories, teabags, and loose-leaf tea.
- The Mediterranean Food Co: An Italian grocery store that sells everything from speciality meats and cheeses to herbs, spices, and luxury gift hampers.
- Giapo: An ice cream parlour pushing the boundaries with unique flavours and a luxury flair to ice cream.
- Angel's Cup (subscription): A coffee subscription company offering boutique tasting experience on a monthly, bi-monthly, or weekly basis.
- Gin Kingdom: A gin store selling global varieties of gin and accessories, including glassware and tonic.
- My Muesli: My Muesli allows its customers to shop from over 80 different muesli blends and create their own custom muesli.
Wrapping Up
Food e-commerce businesses have been flourishing given a massive shift in the market since the pandemic. However, you still need to employ some unique marketing opportunities to stand out and gain a competitive edge. This is especially important because you'll likely be dealing with perishable items. Want our secret recipe for guaranteed success? Schedule a call with our experts today and take the first step towards long-term success!
Frequently Asked Questions
What is e-commerce in the food industry?
E-commerce, aka digital commerce, is the act of buying and selling on the Internet. Selling food and beverages online would make your business a food e-commerce company. Selling such perishable products in a crowded and highly competitive market can be challenging. You can use e-commerce to sell directly to your customers, target other businesses, or use a combination of two or more models.
What is the general trend of e-commerce?
Some common e-commerce trends include the use of AI and AR, voice assistants, social commerce, online-to-offline e-commerce, and live commerce. These trends are always changing and evolving, so it’s best for startups and small businesses to stay updated to remain on top of the game.
What are the food industry trends in 2024?
One of the biggest food industry trends is the shift toward climate-conscious foods amongst a significant chunk of consumers. Careful cuisines are further pushed forward with the interest in plant-forward dining. Among many food trends, this one is expected to experience exponential growth given the explosion of non-meat protein alternatives.
What are the AI food trends in 2024?
Consumers are increasingly turning to ChatGPT and other AI functions to craft meal plans, answer questions related to food safety and nutrition, and improve their overall eating habits. Furthermore, food e-commerce businesses are also expected to shift toward AI for innovative product formulation, precision farming techniques, food waste reduction, and a more resilient supply chain.
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