E-commerce & Online Retail: Explosive Growth in Grocery, Fashion, and Informal Trade

E-commerce & Online Retail: Explosive Growth in Grocery, Fashion, and Informal Trade

E-commerce and online retail continue to experience explosive growth in 2025–2026, driven by technological advancements like AI agents, mobile commerce, improved logistics, and shifting consumer behaviors toward convenience and personalization. Global e-commerce is projected to reach around $6.88 trillion by the end of 2026, with steady expansion despite some macroeconomic headwinds in 2025 (such as trade tensions and slower growth in certain regions). This represents a resilient upward trajectory, with e-commerce expected to account for approximately 21–22% of total global retail sales in the coming years.

Key sectors like grocery and fashion are leading category-specific surges, while informal trade—particularly in developing regions—is increasingly digitizing through social commerce, marketplaces, and mobile platforms.

Grocery: Rapid Penetration and Convenience-Driven Boom

Online grocery has transitioned from a pandemic-era novelty to a core shopping habit, with strong double-digit growth in many markets.

• Global online grocery (including delivery) is projected to reach around $943 billion in 2025, growing at a CAGR of about 9.7% through 2030.
• In the US, online grocery sales have hit record highs, with months in 2025 exceeding $12 billion (e.g., November 2025 at $12.3 billion, up 29% year-over-year in some reports). Penetration is around 12–13% of total grocery sales, with forecasts for continued annual growth of 8–11%.
• Drivers include hybrid fulfillment options (pickup, delivery, ship-to-home), AI personalization, and quick commerce for perishables. Major players like Walmart, Amazon, and Instacart dominate, but regional grocers are investing heavily to capture share.

This sector benefits from repeat purchases, subscriptions, and urban demand for time-saving solutions.

Fashion: Dominant Category with Steady Share

Fashion remains one of the largest e-commerce categories globally.

• It accounts for roughly 27% of online retail revenues (around $1.46 trillion in recent estimates), maintaining a stable share even as overall market grows.
• Growth is fueled by mobile shopping, social commerce (e.g., influencer-driven and livestream sales), virtual try-ons, and sustainability-focused collections.
• Fast fashion, inclusive sizing, and cross-border access continue to drive momentum, especially in emerging markets where online penetration for apparel is high.

Informal Trade: Digitization in Developing Regions

In developing countries—particularly across Africa, Asia, and Latin America—informal trade (street vendors, small markets, MSMEs) is rapidly going digital, blending traditional commerce with e-commerce tools.

• Platforms like social media (WhatsApp, Facebook Marketplace), local apps, and global marketplaces enable informal sellers to reach wider audiences without formal infrastructure.
• In Africa, e-commerce growth is mobile-led, with internet penetration rising and informal traders using social channels for sales (e.g., in Nigeria and Kenya). This supports intra-regional trade under frameworks like AfCFTA, though challenges include logistics, regulations, and low formal penetration.
• Asia (especially Southeast Asia and India) shows explosive informal-to-digital shifts, with quick commerce and social selling boosting small vendors.
• Latin America leads regional growth rates (over 12% YoY in some forecasts), with informal sellers leveraging mobile payments and cross-border platforms.

Overall, these trends highlight explosive yet uneven growth: mature markets focus on AI-driven efficiency and omnichannel experiences, while emerging ones emphasize inclusion of informal sectors through accessible tech. Challenges like tariffs, supply chain issues, and digital divides persist, but innovations in agentic AI, payments, and last-mile delivery position e-commerce for continued expansion into 2026 and beyond.