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NEWS16 June 2014

Online retail sales for FMCG growing globally

Asia Pacific Europe FMCG News UK

GLOBAL — With the FMCG ecommerce market set to grow by $17 million over the next two years, retailers and brands that are slow to adopt the online channel will lose out.

A report from Kantar Worldpanel predicts ecommerce for FMCG will increase 47% from its current $36 billion, to reach $53 billion by 2016.

The report is based on in-depth analysis of the purchasing habits of 100,000 shoppers in 10 of the biggest online FMCG markets, and forecasts that ecommerce will account for 5.2% of global FMCG sales by 2016 – up from 3.7% at present.

In terms of regions, Asia will be the next major growth market and South Korea will continue its lead position with online accounting for 13.8% of FMCG sales by 2016. Today, 55% of Korean shoppers buy online — more than in any other country. Online FMCG market share will continue to grow rapidly in Taiwan and China to achieve 4.5% and 3.3% share of the total FMCG market respectively.

In Europe, the UK leads the online FMCG market. British online shoppers buy on the internet once a month and their carts are five times bigger than offline (in most countries online shopping carts are twice as large as their offline equivalents). However, the growth of the click and collect offer in France, referred to as  ‘Drive’, will see France overtake the UK by 2016 with 6.1% vs. 5.5% of market share respectively.

The opportunity for retailers and brands is clear. Current online shoppers, typically more affluent consumers, tend to favour branded products over own-label making it an ideal platform for brands.

Stéphane Roger, global shopper and retail director at Kantar Worldpanel, said: “Although online only makes up a small share of FMCG sales at the moment, all countries are witnessing considerable growth. One of the main concerns for FMCG players is that ecommerce will take spend away from physical channels. However, this is also one of the biggest misconceptions. Having an online offer helps retailers to secure additional revenue rather than cannibalising existing spend in brick and mortar stores.” 

@RESEARCH LIVE

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