The UK convenience market is forecast to grow by 17.6% in value between now and 2023, while the value of online will surge by more than 50%, according to new IGD research.
The overall food and grocery market is predicted to grow by 14.8% to £218.5bn over the five-year period, with growth forecast for all channels.
The IGD figures reveal that the convenience channel is forecast to return to a stronger growth trend in 2019, with value to reach £47.2bn by 2023.
The convenience channel will deliver the second biggest gain in sales as it meets the growing demand for smaller and more frequent shopping trips. IGD has identified younger shoppers and food-to-go as key opportunities for the channel.
Online will remain the fastest-growing channel, rising in value by 52.4% to reach £17.3bn, with smaller and more recent channel entrants driving growth as they scale up their operations and target emerging shopper needs, IGD said.
However, discounters will achieve the biggest cash gain in sales – more than £8bn to £31.5bn, marking a rise of 36.7%. Growth will be driven by physical expansions as retailers establish stores in new areas that offer a more supermarket-like experience to shoppers.
Supermarkets will grow in value by 7.7% to £95.9bn. While growth is set to dip in 2019 as food inflation wanes, recovery is expected as improvements to stores help lift volumes and create an appealing in-store experience for family shoppers.
On the convenience channel, Simon Wainwright, IGD’s director of Insight at IGD, said: “Major opportunities exist for making c-stores front of mind for shopping trips, particularly those that help shoppers save time. Younger shoppers are key to growth as they are predisposed to shopping at c-stores for more shopping missions than older shoppers.
“Having grown up in the era of ‘new convenience’, offering wider ranges, longer opening hours and supermarket quality, younger generations will be key to driving ongoing growth, but have high expectations that need to be met.”