The Nielsen report, What’s Next in E-Commerce, highlights the latest trends in consumer purchasing online within the FMCG sector, and points to strengthening growth in online adoption and spend around the world. The report illustrates that while FMCG has historically trailed many other categories such as electronics, mobile goods and travel when it comes to online spending, that trend is set to change in the coming years.
As retailers and manufacturers solve for many of the existing barriers to e-commerce adoption, such as retail infrastructure and supply, high level environment and cultural factors such as credit card fraud, and logistics to support the ‘last mile’, FMCG e‑commerce is set for exponential growth. These factors for growth are further compounded by surging consumer demand for anywhere, anytime convenience.
While total FMCG retail sales growth currently sits at around 4% per annum, total retail e-commerce is predicted to grow by 20%, or an additional $2.1 trillion, by 2020.*
“The FMCG sector has been experiencing slow or no growth globally, but we are now seeing signs of strengthening growth as well as premiumisation across the sector, driven in many cases by e-commerce,” observes Prashant Singh, Nielsen’s Head of E‑Commerce, Growth Markets. “And as the source of FMCG sector growth continues to shift to online channels, it will be increasingly critical for retailers and brands to understand the fundamental drivers and influencers to enable them to develop a comprehensive and successful digital strategy.”
According to Singh there are four key influencers significantly impacting e-commerce growth trends around the world:
“The retail sector is experiencing its own iteration of a ‘Kodak moment’. Shifting the balance between high-margin in-store baskets to currently low-margin online baskets requires courage, conviction and insight. For those willing to take a calculated risk, the rewards are there for the taking, as share of growth continues to skew toward online channels,” concludes Singh.
* Worldwide Retail Ecommerce Sales: The eMarketer Forecast for 2016, e-Marketer, 2016