E-commerce sales of groceries grows by 30% in 12 months – study

WORLD – The global sales of groceries through e-commerce platforms grew by 30% in the 12 months to March 2017, according to a new report by Kantar Worldpanel.

A report published last year revealed China’s online FMCG market has reached a value of more than $25.3 billion, making it worth more than the American and British markets combined.

Last year, value increased by 52% in China, 41% in South Korea, 8% in the UK, 7% in France and 5% in Japan and the US, and in terms of absolute value growth, the top six contributors are all leading power economies.

According to FoodBev, the online grocery sector is also expanding into new markets, where there has been significant value growth, for example, in Thailand (+104%), Malaysia (+88%) and Vietnam (+69%) where e-commerce is in early stages.

Known for its attachment to large format hypermarkets, online grocery penetration has increased rapidly in the US in recent months, reaching 30% of the total population.

Annual spending on food and alcohol through e-commerce is this year predicted to reach US$20 billion.

Throughout most of Latin America, e-commerce is lagging far behind traditional methods of shopping, with an exception of Argentina, where e-commerce is exceeding usage compared to the rest of the region.

Kantar Worldpanel said the lack of trust in payment methods coupled with the overwhelming popularity of discount formats makes Latin America one of the most difficult regions for brands to succeed in the online world, as the e-commerce has been lagging behind traditional methods of shopping.

“The fourth annual Future of E-commerce in FMCG study shows that e-commerce now accounts for 4.6% of all FMCG sales,” said Stéphane Roger, global shopper and retail director at Kantar Worldpanel.

“Whilst the e-commerce channel is growing, the FMCG market as a whole is sluggish, increasing just 1.3% during the same period.”

Kantar Worldpanel projections also showed that by 2025, online FMCG will be a US$170 billion business, and hold a 10% total market share.

South Korea and China are predicted to lead the way with a big global uplift coming from the US, estimated to rise from a 1.5% e-commerce share in 2017 to 8% in 2025.

 

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