The grocery aisle isn’t just evolving—it’s being completely reengineered. As consumer expectations shift and technology reshapes how we shop, one thing is clear: the future of grocery growth is powered by AI.
I recently had the opportunity to speak at Groceryshop 2025 on the AI trends pointing the way to the future of the industry. This is a summary of my talk, and a video of the entire presentation can be found below.
The Rise of the digital aisle
According to industry research, 90% of grocery sales are now omni-channel, with online sales growing 5.2x faster than in-store and online sales growth rates set to double year-over-year. What began with omni-channel seeds in the early 2010s has accelerated through rapid platform expansion, the pandemic-driven digital surge, and today’s mature digital grocery landscape.
The next leap? Unified grocery commerce—a seamless experience that erases the line between in-store and online.
Meet the next generation shopper
Gen Z is already leading the charge. This generation is 46% more likely to discover grocery products by browsing search online or via a grocery app than in-store. For grocers, that means digital-first engagement isn’t optional—it’s critical for survival.
As Neha Ghai, Director of Research at Grocery Doppio, puts it:
“Grocers that fail to adopt AI risk revenue loss and reduced competitiveness as Walmart, Kroger, and Amazon set new standards for personalized search, product discovery, and operational excellence”
History has shown us what happens to retailers who don’t adapt— Great Atlantic & Pacific Tea Company is a case study in missed opportunity. A&P was once the largest US grocer, but they were late to ecommerce, underinvested in technology, and never modernized stores with loyalty apps or personalized recommendations when their main competitors were focused on those exact enhancements. A&P filed for bankruptcy twice and had to liquidate and sell off all their stores.
Why AI is the New Growth Engine
Your next growth engine isn’t in the aisle…it's in AI. Leading grocers are already proving what’s possible by transforming the way customers search, shop, and discover.
Here’s what they’re doing differently:
Search that converts: One U.S. grocer saw a 53.5% CVR lift with after implementing Algolia AI search
Merchandising for margin: Auto Mercado uses Algolia to give visibility to CPGs, promote higher-margin private labels, and personalize impulse purchases at checkout
Agentic AI that’s actionable: Conversational experiences that guide shoppers through choices, inspire with recipes, and create engaging experiences that shoppers love
Recommendations that remember: Personalized recommendations can drive a 39% boost in conversion when replacing out-of-stock items
Inventory that talks back: Real-time inventory visibility ensures customers see what’s actually available locally—helping digital searches turn into real-world purchases and enhancing loyalty by giving shoppers the confidence that what they see is what they will receive
AI = Convenience + Margins
At the end of the day, AI isn’t just a shiny technology—it’s the equation that unlocks both customer convenience and retailer profitability. By delivering smarter search, seamless discovery, and dynamic merchandising, grocers can drive loyalty while growing margins.
At Algolia, we’ve recently released an all-new AI solution for grocery ecommerce. The solution gives shoppers the ability to:
Search with natural language
Upload their list and view digital aisles to “shop the shelf”
Chat with AI to be inspired by recipes and content
Easily convert recipes into a shopping cart
And so much more…all while matching that shoppers unique tastes, dietary restrictions, and preferences
The next generation of grocery growth is already here. The only question is: will you be ready to meet it? Connect with our team today to get a demo of our grocery AI capabilities and see how they might work for your business.
Want to dive deeper?
Watch the full “From Aisle to AI” presentation to see how leading grocers are transforming with AI-powered search and discovery - straight from the stage at Groceryshop 2025.
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