Global FMCG ecommerce market will grow by $17 billion
A new report launched today by Kantar Worldpanel reveals strategies for retailers and brands to take advantage of the predicted growth of online sales in the FMCG market. Kantar Worldpanel anticipates that ecommerce will account for $53 billion of global FMCG sales by 2016 – an increase of $17 billion (47%) on the current $36 billion.
The report, which is based on in-depth analysis of the purchasing habits of 100,000 shoppers in ten of the biggest online FMCG markets, forecasts that ecommerce will account for 5.2% of global FMCG sales by 2016 – up from 3.7% at present.
At present, the UK is the trailblazer of the European 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 impressive 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.
It predicts that Asia will be the next major growth market. 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, an exceptionally high figure that is not matched by any other country in the world. 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.
The growth of online FMCG sales presents a prime opportunity for retailers and brands. Current online shoppers, typically middle and upper class, tend to favour branded products over own-label making it an ideal platform for brands. In France, 55% of online consumers re-use the same list for each trip making its essential for brands to secure a place on shopping lists if they are to benefit from this forecasted growth.
The report reveals the barriers which prevent retailers and brands from engaging with the online channel. It shows the majority of these are perceived rather than based on how consumers actually behave. They include a fear that having an online presence will mean sales in physical stores are cannibalised and that consumers will become less loyal if they shop online – the research shows that the opposite is true for both of these scenarios.
The report also showcases the strategies that retailers and brands are deploying to win market share in very different local retail environments, from South Korea, China, France and the UK. These include tapping into impulse purchases, making online retail more fun and the latest techniques in convenience shopping