E-sales of FMCG goods to leap in India: Google-Bain study

With the online retail market booming in India, the internet is expected to influence $35 billion worth of sales in the fast moving consumer goods (FMCG) sector by 2020, says a study by Google Inc and Bain & Co.

The report says the internet would influence one-third of the total sales in the FMCG sector in the next five years.

The influence will be the maximum in categories like male grooming, infant care products and beauty products, it added.

Google India Industry Director Vikas Agnihotri said, "It is clear that FMCG companies in India need to start thinking of digital as a more strategic medium and chart out a digital growth path for their products."

The findings revealed a high propensity amongst consumers to shop online for FMCG products – 50 per cent users had bought a product online in the past three months.

"Most FMCG companies in India have underestimated the impact of the internet and are struggling to ascertain a clear digital roadmap for their products. Companies need to uncover the digital potential for different categories, and align their growth trajectory with the changing consumer behaviour," Bain & Co. Partner Nikhil Prasad Ojha said.

For male grooming products, 25-30 per cent of purchases will happen online; 20-25 per cent  for infant care products; and around 8-10 per cent of all beauty products by 2020, as per the projections.

These findings were derived by studying various factors including research conducted for Bain and Google by Millward Brown across a sample of 1,600 internet users from across 13 cities in India including metros and non-metros - across eight FMCG categories - skin care, hair care, oral care, home care, infant care, male grooming, beverages and food.