Report Overview

Saudi Arabia Online Grocery Delivery Market is flourishing owing to the growing preferences for online shopping, surging demand for doorstep delivery along with the availability of discounts as well as variety of grocery products online...

Saudi Arabia Online Grocery Delivery Market - Industry Trends & Forecast Report 2028

Saudi Arabia Online Grocery Delivery Market is predicted to grow at a CAGR of 17.5% during the forecast period (2022-2028). The rapid expansion of the market is predominantly due to the rapidly growing introduction of new platforms for online food shopping and a change in consumer purchasing habits. Also, easier user interface applications, round-the-clock services, and exciting offers by online grocery channels are aiding the growth of the Saudi Arabia Online Grocery Delivery Market. Moreover, online grocery stores give customers the freedom to order products from home, at any time, and have their goods delivered directly to their homes without any inconvenience. All these factors boost the growth of the Saudi Arabia Online Grocery Delivery Market during the forecast period (2022-2028).

Online Grocery Delivery - Overview

Online grocery delivery is the grocery delivery service that collaborates with grocery store chains to deliver from a variety of locations. As a result, they provide a wide range of products to meet all dietary requirements. Grocery shopping online for home delivery allows the consumer to shop from the comfort of their dining room table, couch, or office, without having to navigate crowded aisles and long cashier lines. Additionally, the term "online delivery services" refers to the collection of goods from a retailer and their delivery to a consumer. That means the consumer can have more time to do the things they enjoy due to home deliveries of groceries.

Saudi Arabia Online Grocery Delivery Market Forecast and Trends

Growth Drivers

Growing Preferences for Online Shopping

Customers are increasingly using online platforms for supermarket shopping, and 80% of consumers still make frequent grocery purchases. This is a result of their extensive product selection, affordable prices, and enhanced shopping and delivery experiences for customers. Moreover, the rise of the Saudi Arabian online grocery market is attributed to the increasing availability of a variety of high-quality products on online platforms where customers can even compare the quantity, pricing, and quality of the provided items. Additionally, the development of the Saudi Arabian online grocery sector is being aided by the channels' attractive offers, 24/7 services, and user-friendly interfaces.

Rising Development in Online Delivery

Standard services like same-day delivery and cashless payment choices are no longer sufficient for e-groceries in Saudi Arabia given the fierce competition in the market. Players in the market are testing out cutting-edge innovations like voice ordering, automated warehouses, and even drone-powered deliveries. Additionally, the opportunity to compare the quantity, prices, and quality of the various goods and services on the online marketplaces is assisting in the expansion of the Saudi Arabian online grocery delivery market during the next five years. When compared to recent trends, which include daily groceries, beauty products, and maintenance services, almost every conceivable need is now met through online delivery. This development is having a direct impact on the growth of the Saudi Arabia online grocery delivery market in the years up to 2028. All these factors boost the growth of the Saudi Arabia Online Grocery Delivery Market.

Accurate Geocoding and Route Optimization

Accurate geocoding and route optimization are assisting businesses around the world in overcoming the long-standing issue of imprecise address systems. Smart geocoders use Machine Learning to accurately decode addresses and can spot even the most ambiguous addresses. In the interior of MENA, this is how complicated Arabic addresses are decoded. Route optimization software can assist in the planning of delivery routes for multiple locations, recommending the shortest and most optimal route to avoid traffic and other on-ground constraints.

Restraints

Storage and Delivery Costs, as well as Inefficiency in Delivery

Storage and delivery costs are one of the most significant capital investments for any online grocery store. Every year, the rising cost of storage and delivery burns a bigger hole in investors' pockets. Distributing and delivering fresh items becomes a concern as well. To a greater extent, an inventory management system integrated with grocery delivery software can solve the problem. Moreover, the delivery aspect of any e-grocery business is tricky because it relies on delivery executives and isn't always reliable. An efficient delivery system is required to deliver the product fresh within the delivery timeline. Also, the key to motivating executives is to provide the appropriate training and education. Good work should be acknowledged and rewarded. All these factors hinder the growth of Saudi Arabia Online Grocery Delivery Market

Impact of COVID-19 on Saudi Arabia Online Grocery Delivery Market

The COVID-19 pandemic-induced lockdown boosted the online delivery market. The preferences for online grocery shopping increased during the pandemic. This is due to the easy availability of time slots, lower service fees, and doorstep delivery. Also, the convenience of picking up the grocery while on the way are encouraging people to use click & collect services, book the grocery online, and pick up the groceries they ordered while avoiding crowds. As a result, grocers are rapidly developing click-and-collect capabilities as part of their efforts to provide a convenient and robust customer experience across their grocery network.

Saudi Arabia Online Grocery Delivery Market – By Product Type

Based on the product type, the Saudi Arabia Online Grocery Delivery Market is segmented into Fresh foods, Household Products, Packaged Foods & Beverages, Personal Care, and Others. Among these, Packaged foods and beverages account for the largest market share. This is due to an increase in demand from the country's working population, owing to a busy lifestyle and easy access to convenient delivery. Moreover, fresh foods are also expected to grow significantly in the market due to the availability of fresh meat, fresh vegetables, fresh fruits, and so on to consumers. Additionally, multiple market players have flooded the market, claiming that farmer's market fresh products are frozen and supplied with the utmost care to ensure that the nutrient content of the food item is not disrupted, thereby contributing to the growth of Saudi Arabia online grocery delivery market.

Saudi Arabia Online Grocery Delivery Market - By Mode of Payment

Based on mode of payment, the Saudi Arabia Online Grocery Delivery Market is segmented into Pre-Delivery Online Payment, Card on Delivery, and Cash on Delivery. The cash-on-delivery segment now has the biggest market share and is likely to continue to do so during the forecast period (2022-2028). This is because, in Saudi Arabia, cards and online payments come in second behind cash as a preferred payment method, including cash-on-delivery. According to research, there are currently roughly 31 million cards in circulation, 88 percent of which are debit cards and 12% are credit cards. The regional scheme, Mada, is imprinted on all debit cards. Mada use is encouraged by the government and is required locally.

Saudi Arabia Online Grocery Delivery Market – By Region

Geographically, the Saudi Arabia Online Grocery Delivery Market is segmented into Central, Eastern, Western, and Southern. Among these Central and Western Saudi Arabia are identified as the primary regions, based on the demand for online grocery delivery services in the Kingdom, based on the demand for online grocery services in the Central and Western Region, Riyadh, Makkah, and Medina are identified as key cities. Demand then increased in the Eastern, Southern, and Northern Regions. When it comes to supply and demand online grocery services, Dammam, Asir, and Ha'il are thought of as developing regions.

Competitive Landscape

The leading market players in the Saudi Arabia Online Grocery Delivery Market are Nana Direct, Quix, Khodar & More, Lulu Hypermarket KSA, Noon, Talabat, Haseel, Shgardi, Jumlaty, Qava Shop, and other prominent players.

The Saudi Arabia Online Grocery Delivery Market is highly fragmented with the presence of several manufacturing companies in the country. The market leaders retain their supremacy by spending on research and development, incorporating cutting-edge technology into their goods, and releasing upgraded items for customers. Various tactics, including strategic alliances, agreements, mergers, and partnerships, are used.

Recent Development

• In November 2021, Saudi Arabia signed a Memorandum of Understanding(MoU) with Oman to strengthen the digital economy.

Scope of the Report

By Product Type

• Fresh foods
• Household Products
• Packaged Foods & Beverages
• Personal Care
• Others

By Platform

• Mobile Application
• Desktop Website

By Mode Of Payment

• Pre-Delivery Online Payment
• Card On Delivery
• Cash On Delivery

By Region

• Central
• Eastern
• Western
• Southern