Biggies also lean on ecommerce for product launch

Buying grocery items on the internet is an idea that Indians, both sellers and buyers, are warming up to. Although grocery shopping from the internet seems far-fetched now, many fast-moving consumers’ goods (FMCG) companies like GlaxoSmithKline (GSK), PepsiCo and Godrej have started using online space and social media to target customers, with product launches and advertisements.

Examples

1. Last year, consumer goods company Marico launched its male grooming brand Set Wet’s styling gel through online retail spaces like Flipkart, Snapdeal and Aaramshop. The product was sold exclusively on these online marketplaces for three months to understand and gauge customer response, before being sold through normal shops. The online platforms gave them instant feedback and key insights.
2. When GSK introduced Nutribic biscuits in India last year, it restricted advertising to Facebook platform only.

FMCG companies prefer internet over television now

FMCG companies now use online platforms more as compared to television due to the following reasons:

• Lesser media costs and cost pressures– Internet optimizes media costs while providing significantly higher cost efficiency.

• Better reach in tier 2 and 3 cities– Growing internet penetration and smartphone usage has made it possible to reach out to customers from even far-flung areas as they use internet to access social media platforms.

• Instant feedback and key insights from the online spaces.

• Easier to implement, learn and scale up.

Opportunity for Indian Online Seller

Big FMCG companies’ preference for ecommerce to launch products is an indicator of ecommerce growth and potential. Like they target untapped potential consumers from far-flung areas, online sellers can use online marketplaces to sell their products to potential customers pan India without the restriction of geographical boundaries and based on customer response, can think of increasing their product portfolio.