Best Fast Dropshipping Service & Business India

<p>Representative Image</p>
Representative Image

An end to Covid-era mobility and operational curbs and the return to normal business hours for physical stores have not, contrary to expectations, slammed the brakes on web commerce that had boomed through the pandemic for the contactless doorstep delivery features it offered.

A whole array of products, from the humble cookie and other daily munchies to pocket-pinching discretionary items such as television sets and refrigerators, are selling on ecommerce sites with frequencies similar to or higher than those through the lockdown days, showed the latest data by market researchers NielsenIQ and GfK India.

“This reflects a post-pandemic change in consumer behavior, particularly in metro areas, where online shopping is gaining popularity due to its convenience, variety and competitive pricing,” said Praful Babar, head of e-commerce for FMCG at NielsenIQ.

As per the data, the sales contributions across FMCG categories saw a surge in calendar 2023 as compared with the previous year. For instance, the contribution of e-commerce sites went up to 5% in 2023 from 3% in 2022 for impulse food such as chocolates, confectioneries and salty snacks, NielsenIQ data showed.

In case of fabric care for products like washing powders/liquids, pre-post wash, detergent cakes/bars and blues, the contribution surged from 6% to 7% in the period under review, while for home cleaners such as for utensils, toilets, floors and glass the surge was from 10% to 11% in 2023.

As per industry estimates, this surge in these categories alone would have added Rs 3,000 crore incremental business for e-commerce in 2023.

Even for electronic products, there is a 1-2 percentage point increase in ecommerce contribution in 2023 as compared with 2022. Last year, ecommerce accounted for around 33% of television sales, 20% of washing machines, 15% for refrigerators and 10% for air conditioners. The researchers said this trend of incremental gains in web commerce will continue in 2024 as well.

As per NielsenIQ, online channel growth for FMCG products is primarily driven by consumption, while both price and volume factors influenced offline growth.

Niche Items
Parle Products vice president Mayank Shah said in certain products such as protein, health and gourmet food, ecommerce contribution is much higher. “Several smaller and premium brands are exclusively on ecommerce. In metroes, it’s quick commerce which is driving adoption,” he said.

GfK data shows electronic and household appliances like refrigerators, washing machines and televisions grew faster in the online channel than offline in 2023. Categories like frost free refrigerators, front loading washing machines, and 55-inch and above televisions have grown double in online as compared to their respective categories.

“Traditionally, consumers prioritized pricing and mass-market options when shopping online. However, recent trends indicate a shift towards premium segments,” said Anant Jain, head of customer success – India at GfK.

It’s the same in FMCG. Babbar said online volume growth of impulse food and fabric care at 47% and 32% respectively in metros was four times as compared to offline sales. Similarly, categories like soft drinks, biscuits, packaged atta and refined edible oils are also showing significant volume growth.

Babar said to capitalize on this trend, FMCG brands and retailers are strategically investing in omnichannel presence to capture a larger market share.

“This includes optimizing their online presence, establishing robust online distribution networks, tailoring marketing strategies to cater to online shoppers, and ensuring seamless e-commerce experiences for consumers,” he said.

GfK said urban Indian consumers are increasingly turning to social media for their shopping needs. Over 70% of smartphone and computer owners now use their devices to make online purchases while more than half of urban consumers find shopping on social media enjoyable due to targeted product recommendations from brands, it said.

  • Published On Mar 19, 2024 at 08:55 AM IST

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Best Fast Dropshipping Service & Business India

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