Market researcher Nielsen will soon begin tracking online e-commerce sales data in its research in response to rapidly growing online sales as FMCG companies have raised concerns about data not being fully representative.
Nielsen South Asia executive director for retail measurement services, Sameer Shukla, confirmed that the data and analytics company would begin mapping online sales measurement soon. “Nielsen continuously endeavours to enhance its retail measurement offerings by capturing all forms of consumer points of purchase, online as well as offline. E-commerce measurement is definitely one such important milestone in it.”
E-commerce contributes about 2% to India’s Rs 3.4 lakh crore FMCG business, up from 0.4% in 2016, and its share is expected to widen to 11% by 2030 — an 8-times growth from its current size, a recent Nielsen report said.
“E-commerce is a fast growing channel for us and data representation from the channel is required for more accurate growth and market share mapping,” said biscuits maker Parle Products’ category head Mayank Shah.
The Nielsen report said urban markets, fuelled by a rapidly growing internet economy, accounted for a bulk of sales within e-commerce. The report said the e-commerce channel has grown at over 101% over 2017 and in specific product categories and markets, the contribution is already touching double digits of total category value sales.
“While online sales are small as of now for a category like ours, growth in the channel is projected to grow rapidly. Going forward, e-commerce data will be necessary and help us directionally,” said the managing director of confectionery category leader Perfetti Van Melle, Rajesh Ramakrishnan.
Perfetti Van Melle, which makes brands like Happydent gum and Alpenliebe candy, leads the Rs 12,000-crore confectionery category with more than 20% share.
Mid last year, consumer goods giant HUL had questioned Nielsen findings saying it was not giving a correct indicator in terms of growth and market share. The maker of Sunsilk shampoo and Magnum icecream had pointed out “base issues” with Nielsen numbers.
Online retail is growing four times faster than brick-and-mortar stores though on a smaller base, a report by consulting firm Bain & Company said. Riding on factors such as these, consumer goods companies are increasingly using the e-commerce channel to first test and soft launch products. ITC, PepsiCo, Marico and Nestle are among the large companies which have been launching products online only before placing them in traditional retail stores.
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