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Global online FMCG sales grew by 20% in 2018

11/06/2019

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Global online FMCG sales grew by 20% in 2018

US and China Mainland are fastest growing online FMCG markets globally
Online pure players are attracting new shoppers while traditional retailers struggle

Online sales of fast-moving consumer goods (FMCG) grew by 20.3% globally in 2018 and now represent 5.1% of grocery sales worldwide, according to new Kantar data. Growth was spurred by the US and China Mainland, which together represent 84% of the growth in global e-commerce thanks to the success of Amazon, Alibaba, JD.com and Walmart.

FMCG value growth, 2018

Country

Online FMCG value growth

Global

+20.3%

US*

+35.9%

China Mainland

+32.3%

Taiwan

+31.9%

Italy

+26.3%

South Korea

+14.0%

Germany

+11.5%

Spain

+9.1%

France

5.7%

UK

3.5%

Japan

0.8%

Source: Kantar, GfK, Intage, full year 2018*Estimate Kantar & US Commerce Department

A high penetration of online purchases in Asian economies are made via smartphone, meaning these countries continue to lead the way in terms of online FMCG shopping. Over 19% of all FMCG sales in South Korea now come from online, the highest proportion in the world. China Mainland follows with 14.0% – though based on current growth rates and the fact that nine in ten online purchases are already made on a mobile, it is expected to overtake South Korea’s position by 2025. Taiwan’s online share of FMCG sales stands at 8.2% and in Japan it has reached 7.7%. 

In Western Europe[1] 4.1% of grocery sales came through e-commerce, primarily led by the UK at 7.2% and France at 5.6%. However, plateauing shopper numbers in both countries mean growth was slower than in the previous year. In contrast, e-commerce sales grew by almost 35% in the Netherlands, where start-ups like Picnic have contributed to a total of 4.5% of FMCG sales now coming through online.

In Eastern Europe[2] online FMCG is less developed, accounting for just 1.9% of sales in 2018. Only the Czech Republic and Russia registered more than 1.5% of sales online in the region, with 3.3% and 2.2% respectively.

Equally, online FMCG shopping in Latin America remains nascent. While Argentina leads the way, only 0.6% of sales come through e-commerce and this is no increase on the year before. Concerns about security and limited payment methods are still barriers for local consumers in shopping on the web.


Online sales, % of total FMCG sales

E-commerce value share (%)

2017

2018

 

 

Global

4.3%

5.1%

 

 

South Korea

17.0%

19.1%

 

 

China Mainland

11.1%

14.0%

 

 

Taiwan

6.4%

8.2%

 

 

Japan

7.6%

7.7%

 

 

UK

7.2%

7.2%

 

 

France

5.4%

5.6%

 

 

Netherlands

3.5%

4.5%

 

 

US*

3.3%

4.4%

 

 

Czech Republic

3.0%

3.3%

 

 

Denmark

2.2%

2.6%

 

 

Spain

2.2%

2.4%

 

 

Austria

2.5%

2.3%

 

 

Russia

2.4%

2.2%

 

 

Vietnam**

0.8%

1.9%

 

 

Malaysia

1.5%

1.8%

 

 

Thailand

1.2%

1.8%

 

 

Italy

1.4%

1.7%

 

 

Portugal

1.6%

1.6%

 

 

Germany

1.4%

1.5%

 

 

Hungary

1.1%

1.5%

 

 

Slovakia

1.2%

1.2%

 

 

Poland

1.1%

1.1%

 

 

Argentina

0.6%

0.6%

 

 

Croatia

0.5%

0.6%

 

 

Bulgaria

0.2%

0.3%

 

 

Indonesia

0.1%

0.2%

 

 

Chile

0.1%

0.2%

 

 

Colombia

0.1%

0.2%

 

 

India

0.1%

0.1%

 

 

Philippines

0.0%

0.1%

 

 

Brazil

0.1%

0.1%

 

 

Source: Kantar, GfK, Intage, full year 2018

*Estimate Kantar & US Commerce Department**Vietnam Urban (4 key cities)

 

Pure players driving growth

Globally, it is the online pure players like Amazon, Alibaba and JD.com which are winning in the e-commerce market as they continue to attract new shoppers. Pure players now represent 72% of online sales, posting a staggering collective growth of 29% in 2018. In the face of this competition, retailers operating across both bricks and mortar and e-commerce channels grew by only 3% in comparison, though reducing the delivery delay and offering free, or cheaper, options would help multi-channel retailers to close this gap.

The pure play giants are dominating on both sides of the globe – Amazon now represents 53% of all FMCG online sales in the US. While Amazon has not yet been able to hit equal heights in Europe, it has achieved online FMCG market shares of 8.8% and 5.0% in Germany and France and is up to 3.2% in Spain and 1.0% in the UK.

Pure players vs traditional retailers, % value share of online FMCG

Value share (%)

Pure players

Traditional retailers

Global

71.8%

28.2%

China Mainland

99.1%

0.9%

Taiwan

92.7%

7.3%

US*

60.0%

40.0%

Denmark

52.8%

47.2%

Germany

48.4%

51.6%

Russia

43.0%

57.0%

Spain

24.4%

75.6%

UK

16.2%

83.8%

Austria

11.7%

88.3%

Source: Kantar / GfK, full year 2018*Estimate Kantar & US Commerce Department

Eric Batty, global e-commerce business development director at Worldpanel Division, Kantar, comments: “While online sales for multi-channel retailers in Europe tend to focus on traditional food and drink products, Amazon’s sales are more heavily skewed towards personal care. In France, for instance, while Amazon is the online leader in personal care for food and drink it ranks only seventh. There, traditional bricks and mortar retailers have found success through in click-and-collect, with the likes of E.Leclerc 20 times bigger than Amazon for online food sales thanks to its DRIVE pick-up points.”


[1] Western Europe includes Austria, Denmark, France, Germany, Italy, Netherlands, Portugal, Spain and the UK.

[2] Eastern Europe includes Bulgaria, Croatia, Czech Republic, Hungary, Poland, Russia and Slovakia.

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