 Instacart’s share of the online grocery market reached a high of 57% in

April, according to a new report from The Information and Second Measure

based on purchasing data. While it tapered off a bit in May, Instacart still has
more than half the market.
 The growth is particularly notable because it puts Instacart ahead of competitors
including Walmart, which saw its market share drop about 25% in March as it
struggled to meet surges in demand due to COVID-19. Walmart held as much as
50% of the online grocery market last year, Forbes reported.
 The report suggests one reason for Instacart’s rapid growth is its business model,
which taps into many retailers, from local and regional chains to large national
retailers including Kroger, Albertsons and Costco.

The Rivalry among existing firms shows the number of competitors that give tough competition to the
Instacart and the New Wave of Grocery Startups High rivalry shows Instacart and the New Wave of
Grocery Startups can face strong pressure from the rival firms, which can limit each other’s growth
potential. Profitability in such industries is low as firms adopt aggressive targeting and pricing
strategies against each other.
The Rivalry among existing firms will be low for Instacart and the New Wave of Grocery Startups if;
 There are only a limited number of players in the market
 The industry is growing at a fast rate
 There is a clear market leader
 The products are highly differentiated, and each market player targets different sub-
segments
 The economic/psychological switching costs for consumers are high.
 The exit barriers are low, which means firms can easily leave the industry without
incurring huge losses.

Similarly, there are some factors that increase the Rivalry among existing firms for Instacart and the
New Wave of Grocery Startups For example, the company will face intense Rivalry among existing
firms if market players are strategically diverse and target the same market. The rivalry will also be
intense if customers are not loyal with existing brands and it is easier to attract others’ customers
due to low switching costs. Competitors with equal size and offering undifferentiated products with
slow industry growth tend to adopt aggressive strategies against each other. These all factors make
the Rivalry among existing firms a major strategic concern for Instacart and the New Wave of
Grocery Startups

BERNARD L. SCHWARTZ COMMUNICATION INSTITUTE