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In the UAE, what was once a routine errand is now a high-speed, tech-powered experience built around personalisation, speed, and instant gratification. With $38.29bn in revenue generated in 2024 — and a projected CAGR of nearly 5 per cent through 2028 — the e-grocery industry isn’t just growing, it’s transforming.
From AI-driven inventory to delivery that’s faster than you can write a list, this shift is powered by innovation that’s redefining how, when, and why we shop.
The popularity of e-grocery is perhaps the most telling sign of change. With the segment hitting $1.14bn in 2024, commanding 17 per cent of the nation’s total e-commerce market, it’s clear this market is reshaping the future of retail.
Growing at a staggering CAGR of 25.4 per cent, its ascent promises a $2.82bn milestone by 2028.
These figures are more than just numbers, they highlight a radical shift in consumer shopping habits towards the virtual cart and checkout.
Consumer behaviour shifts: A new demand for speed and personalisation
The landscape of consumer demand is undergoing a metamorphosis, highlighting the need for speed, personalization, and value. This transformation is symbolized in the rise of quick commerce — our arena of grocery and retail—where the expectation isn’t merely for same-day delivery but delivery that races the clock, within minutes.
Illustrative of this shift, our innovative talabat Mart stores have effectively halved delivery times, catalysing a remarkable surge in customer interaction, with order frequencies in these locales climbing by 1.3 times.
This evolution amplifies the essence of speed in magnifying customer engagement within digital retail.
The rhythm of consumer habits is also shifting, with peak hours between 5pm and 9pm driving nearly 40 per cent of all grocery and retail orders — a clear signal of the need for precise capacity planning and real-time inventory updates to masterfully navigate high-demand windows. But the story doesn’t end there.
Late-night orders are carving out their own space in this evolving dynamic, with categories like snacks and beverages witnessing an impressive average of 48 per cent growth year-over-year.
The “nocturnal” demand is rewriting the script on traditional shopping and what it means to shop on your own time, stretching the boundaries of convenience deep into the off-hours.
The modern consumer isn’t just participating in the marketplace, they’re seeking a dialogue with it.
Personalisation has become the drumbeat to which modern consumer behaviour marches, with personalised item-level deals boasting over 30 per cent higher click-through rates than their generic counterparts, given the consumers’ strong preference for offers tailored to their unique tastes.
Further reflecting this personalised journey is the uptick in search-led sessions, as consumers make bespoke and health-conscious choices.
Searches for niche and lifestyle staples like matcha, vegan cheese, and protein snacks paint a picture of a consumer base that’s not just buying, but curating their carts with intentionality, carving a shopping experience that’s not just satisfying but also markedly theirs.
The rise of private labels in the digital grocery and retail space
The rise of private labels is transforming the very definition of value in the grocery and retail space, blending affordability with quality in a way that deeply resonates with modern consumers. Since debuting our first offerings in the UAE in November 2023, we’ve scaled to 351 SKUs across seven countries by April, achieving a 1387 per cent year-over-year growth.
This trajectory reveals a clear consumer preference for products that deliver a seamless harmony of cost and craftsmanship.
Private labels aren’t merely a product line — they’re the new narrative of value, innovation, and trust in retail.
The strategic expansion of our food category signals a decisive step to align with evolving consumer demand.
Currently, with 89 per cent of our portfolio composed of non-food items, this shift reflects a targeted effort to diversify and meet the growing appetite for food-related offerings.
Leveraging technology for operational excellence
The integration of advanced technology has been transformative, solidifying our leadership in the grocery and retail industry.
AI-driven computer vision enables real-time stock accuracy, minimising out-of-stock scenarios through predictive replenishment, while IoT systems in dark stores ensure consistent product quality without physical oversight.
These innovations have culminated in a 98 per cent order fulfillment rate, reducing errors and delays, and enhancing overall customer satisfaction.
Today, grocery shopping has gone from being a mundane chore to a futuristic journey powered by cutting-edge technology such as AI, ML, and IoT. These innovations do more than streamline operations; they revolutionise the consumer experience by weaving convenience, accuracy, and promptness into the very fabric of service.
The industry can leverage these technologies to not only keep pace with modern demands but also foster connections characterised by deep trust and shared benefits.
The writer is the chief retail officer at talabat.
