The Institute of Grocery Distribution (IGD) has published its Global Convenience Trends Report 2025, which it said revealed “significant changes” ahead for the convenience retail sector.
IGD found that sales are projected to exceed $1 trillion by 2029, driven by a compound annual growth rate (CAGR) of 4.1%.
It highlighted that retailers need to adopt new convenience models, enhance store formats and integrate digital tools, while suppliers need to adapt product strategies to emerging food trends and convenience needs. The report outlined five key global trends shaping the future of convenience retail:
- Tech Evolution: New stores are leveraging technology to adapt to and meet changing shopper behaviours.
- Food Mission: Convenience now includes dine-in options, on-the-go snacking, food for later and drinks.
- Shifting Space: Efficient space reallocation boosts revenue and enhances the customer experience.
- Targeted Value: Promotions and loyalty programs are evolving to be personalised and targeted.
- Striving for Better: Sustainability and health initiatives are becoming “crucial” for meeting consumer demands.
The report detailed how the convenience channel remains the third-largest modern trade channel over the next five years but faces “strong competition”, impacting its growth. While the global grocery market is projected to grow annually by 4.2%, the convenience channel’s growth is slightly behind, at 4.1%. This will mean the convenience channel will lose market share, from 10.7% in 2024 to 10.6% in 2029.
IGD said this share loss is largely due to the faster growth of smaller, but rapidly expanding, channels: discount and online. Discount retailers will attract budget-conscious shoppers, while online retailers will offer a breadth of range that convenience stores struggle to match. Supermarkets, despite their slower growth, are also becoming a “greater threat” to convenience stores, and operators are expanding their smaller footprint formats.
To stay competitive, the report stated retailers must differentiate through enhanced in-store experiences, strategic space allocation, and value-driven promotions. Sustainability and health initiatives are also “crucial” for meeting consumer demands and enhancing brand image.
Sneha Haria, insights manager at IGD, emphasised: “Convenience retail is evolving from quick transactions to smart, seamless experiences. Our report highlights key trends like digital innovation and healthier food options that will define success in 2025 and beyond.
“While the sector uses its proximity and adaptability to meet consumer trends, it must address costs and competition challenges. Retailers need to close the price perception gap with other channels and make targeted value visible across regions. Sustainability and health are emerging trends globally, even though they are not typically front of mind for convenience shoppers.”
