Amazon & Blue Apron Help Ignite Online Grocery Industry

Consumer analytics firm Nielsen (NYSE:NLSN) just released its second-ever online food shopping study, which found that the industry Amazon (NASDAQ:AMZN) and meal-kit delivery companies such as Blue Apron (NYSE:APRN) helped popularize is set to grow into a $100 billion market soon.

On Monday, Nielsen, in partnership with the Food Marketing Institute, released its “Digitally Engaged Food Shopper” study. The joint venture found that within as few as five to seven years, 70% of all U.S. consumers are expected to buy at least a portion of their groceries online.

Previously, Nielsen and FMI projected it would take the U.S. online grocery business until 2025 to reach the $100 billion milestone. “The grocery industry is currently in the age of digital experimentation, where the roadmap on how to navigate and achieve real and profitable growth continues to evolve,” Nielsen executive Chris Morley said in a statement.

The Digitally Engaged Food Shopper study found that the online grocery industry is set to expand rapidly, but investors should know that it is already widely popular in the U.S. CNBC noted that 49% of all U.S. shoppers bought a packaged good online within the last three months.

Looking at the generational breakdown, 61% of Millennials purchased at least some type of grocery item online, while 44% of Baby Boomers also joined the new online shopping trend.

This growth hardly comes as a shock to many investors and certainly won’t surprise many retailers. In fact, over the last year, big-box giants Walmart (NYSE:WMT) and Target (NYSE:TGT) have attempted to bolster their online grocery businesses in order to better compete with Amazon.

Looking ahead, grocery companies such as Kroger (NYSE:KR) and Costco (NASDAQ:COST) will likely invest more money in online ordering technologies and infrastructure.

On top of investments from industry giants, grocery delivery startups such as Instacart have become popular in cities around the country. Now, as Instacart partners with everyone from Petco to CVS (NYSE:CVS) , investors might see more shake-ups and mergers akin to Amazon’s Whole Foods purchase sooner than later.

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