Unprecedented growth of E Commerce

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Unprecedented growth of E Commerce

02/03/2022 Publication :The Pioneer Author :Manish Agarwal

Over the past two decades, the FMCG (fast-moving consumer goods) sector in India has witnessed remarkable transformation especially in terms of adopting online sales across different categories. Facilitated by changes in consumer behaviour, rapid urbanisation, rising disposable incomes and internet penetration, e-commerce has grown exponentially providing growth opportunities to both big and small players in the FMCG industry. As per reports by Nielsen, a market research firm, the contribution of e-commerce to total FMCG sales is expected to go up to 11 per cent by 2030. With huge opportunities for growth and development in the e-commerce segment, the competition in the FMCG sector is set to become tighter where both offline and online retail strategies will hold the key.

Growth of E-Commerce

From $38.5 billion in 2017, the Indian e-commerce market is expected to reach $200 billion by 2026. Growing at a YoY rate of 5 per cent, the e-commerce market in India is expected to become the second-largest by 2034, surpassing that of the United States.

E-Commerce trends will positively impact FMCG businesses

Digital innovation and the growth of e-commerce has led to the emergence of several new players in the market who are giving stiff competition to existing players. With differentiated business models optimised to serve the rising demands of the present consumer, these players are expected to contribute to more sales for the FMCG sector over the coming years.

Apart from that, new and existing players are re-inventing their business processes by forming links with stable and bigger e-commerce businesses.

With the development of e-commerce platforms for grocery stores and local retailers aggressively underway, it is further going to contribute to sales and overall business growth in the FMCG sector.

As a growing number of consumers are opting for contactless and safe deliveries through e-commerce channels, online platforms, as well as local neighbourhood stores, are also witnessing an uptick in demand. Enhanced product information and valuable reviews are some of the other factors that are driving consumers towards online shopping.

The landscape of shopping has dramatically transformed over the last few months. While retail still holds a lot of significance, e-commerce has taken off and is expected to further aid FMCG brands in driving sales, increasing market share and attracting new customers. With e-commerce encouraging a direct-to-customer (D2C) model, FMCG businesses are benefiting in different ways such as better monitoring, quickly reaching out to consumers and building trust.

Omni-Channel strategy is important

It isn’t just about replicating an offline strategy—a personalised experience for the consumers is essential. From product pictures to precise and clear brand descriptions to various product portfolios for digitised platforms, FMCG businesses should look to enhance the scope of their online offerings by increasing coverage for delivery; offering more convenient and quicker delivery options; and providing items or products that are hard to find offline.

The writer is Manish Aggarwal, Director, Bikano, Bikanervala Foods Pvt Ltd


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