With more and more people surfing online for FMCG products, the Internet would influence over a third of total sales in the sector by 2020, while online sales will constitute $5 billion, says a study by Google and Bain & Company.
“The influence of the Internet will impact $35 billion worth of FMCG sales in the country by 2020, as more and more users go online to research for FMCG products. Total FMCG sales are expected to be around $100 billion by then,” Google India, Industry Director, Vikas Agnihotri told reporters here.
He added that $5 billion or 5 per cent of total FMCG sales will be online by 2020, which is 50 times the growth from current level of just 0.3 per cent now.
Projecting growth of online user population, the report revealed that the country would have over 650 million Internet users by 2020, more than double of 300 million users in 2014.
Besides, 100 million women would be shopping online by 2020, it said.
The survey was conducted among around 1,600 online users (male and female) from across 13 cities, covering eight FMCG categories such as skin care, hair care, oral care, home care, infant care, male grooming, beverages and food.
Agnihotri said rural markets would also contribute to the digital growth and vernacular content would play an important role to drive the sales.
“A couple of changes are definitely going to happen. You will see a lot more Hindi and vernacular content going up. People feel comfortable in their mother tongue and about 500 million people speak Hindi. It’s logical that the next move will be from English to Hindi and other vernacular stuff will actually happen,” he said.
The study revealed that 35 per cent men and 22 per cent women search online before making their purchases.
“The Internet influence differed by category of products with maximum influence on purchase decisions noticed in male grooming (39 per cent), skin care (26 per cent), infant care (24 per cent)and hair care (24 per cent) products,” it said, adding that online searches for beauty products are growing at over 100 per cent.