Insights

Online trading victory

E-commerce is the only channel that is experiencing high growth regardless of country, region or continent. And if the offline market often develops due to inflation, then the e-commerce segment develops due to real consumption.

The reasons why consumers choose to shop for FMCG online vary greatly from country to country. In France, they most appreciate the range of fresh products, in Italy - the availability of a large number of new products, in Finland - the convenience of navigating online retailers' sites. But if you remove the names of specific countries from the list of advantages, you will notice an important thing: online trading today covers all the key needs of buyers.

Online has become a complete replica of offline, and the modern buyer goes there even for small purchases. If a year ago the main mission in online stores was to buy for the future, now the popularity of different types of baskets has leveled off: 24% of orders fall on baskets with personal care products, 15% - the purchase of fresh products and goods with a short shelf life, 10% - purchase of groceries, 10% - purchase of pet supplies and only 9% for purchases for future use2.

Over the past year, the number of online FMCG orders has quadrupled, and the changes that we are seeing indicate that the wall between the online and offline market has finally collapsed, and the channel will continue to outperform development: more than half of the retailers and manufacturers surveyed by NielsenIQ expect that by the end of 2022 the share of online FMCG sales  will reach 5-10%3.

The potential of discounters

Today, the share of FMCG sales in EU discounters is 32%, and the number of channel visits per month remains higher than in any other format - more than 7 times per month4. However, these values still have a lot of upside potential, largely due to the evolving hard discounter format. Customers appreciate them for low prices, but no longer perceive them as stores with cheap goods. They think in other categories: for example, the main characteristic of a visit to Fix Price is an assortment that includes many useful little things, the Da! - cleanliness and hygiene in the store, "Bread and Salt" - close proximity to the house, "Chizhik" - convenience for small purchases and restocking.

Fortunately, EU retailers have the opportunity to use the already accumulated global experience to develop their own business. In Eastern Europe, where discounters have long occupied a strong niche and are responsible for approximately 40% of FMCG sales, the focus of the development of "hard" discounters has shifted towards further improving the shopping experience: the atmosphere in the store, focusing on ultra-fresh products and pastries, launching a limited range of products from other countries and local manufacturers, active communication with the audience. All these steps allowed to transform discount stores from "cheap" to "fashionable" stores, and take the channel to a new level.

A New Meaning of Impulsive Demand

One of the most striking trends in the FMCG market at the moment is the formation of a new model of impulse consumption, which was caused by the development of express delivery services. In the first half of 2021 alone, the number of dark stores of the two most famous players in this segment, Yandex.Lavka and Samokat, grew by 60%, while the number of orders of the latter more than tripled, exceeding 5 million5. The impact of express delivery on the online FMCG market is so great that it resulted in a 39% decrease in the average check in the FMCG online market during the year.

New impulse consumption models allow not only to create new situations for making unplanned online purchases through attractive prices or limited offers, but also to manage the economy of the order more effectively. For example, OZON Express achieves an average check increase of up to 10% thanks to accurate recommendations both on the category page and inside the cart itself.