Compared to other nations, China’s online FMCG sales grew at the fastest rate of 2014. It’s estimated that by 2025, online sales in China will take up 15% of total FMCG sales. Right now, it’s at 2.6% and still growing.
Worldwide FMCG sales are set to hit USD 130 billion by the end of 2025, according to Kantar Worldpanel. eCommerce shares within total FMCG sales, in advanced eCommerce markets, will double in the coming decade. Compared to China’s 15%, South Korea will reach 30%, and the UK & France will rise to 10% by 2025.
eCommerce in China led the world in FMCG online sales growth in 2014, growing by 34% – while the average global growth stood at 28%. South Korea came in second with a YOY growth of 22%. Meanwhile, Europe grew by 20%, and UK & France grew by 12%. South Korea, however, continues to have the highest online share of FMCG sales, with 13.2% conducted through eCommerce channels.
Retailers and brands – 3 Opportunities
Based on an in-depth analysis of the buying habits of over 100 thousand shoppers in the 10 biggest online FMCG markets, we see that brands and retailers must prioritize the research & development of more robust eCommerce strategies to take advantage of the opportunities that eCommerce brings:
- An Ever-Growing Online Market – On a global level, only 1 out of 4 shoppers purchase goods online. South Korean consumers highlight the potential for growth, as over 58% of the country’s households buy FMCG products online at least once a year.
- Comprehensive Shopper Profiles – Thanks to the detailed information that shoppers volunteer whenever they buy online, access to buyer data has never been easier! For example, we now know that the average online shopper in the UK spends about USD 66 per basket, compared to USD 16 when buying from a physical retail store.
- Fostering Brand Loyalty – The chances of shoppers buying from an online store increases the more they purchase from a given online platform.
Multinational corporations, such as Walmart, Coca-Cola, and P&G, have all started implementing plans to future-proof their businesses by following trends and conducting research for their online segments. Global leaders may be taking fast action, but – as is the case for most innovations in technology – the market is very unkind to latecomers. Tesco and E. Leclerc both enjoy online market shares in their respective home markets. For brands, the urgency lies on getting on buyers’ shopping lists, thus giving first-movers a big advantage.