12 Sep /17

The Future of the FMCG Industry

The Future of the FMCG Industry
The Future of the FMCG Industry – EVS Translations

Virtually every aspect of our lives has been changed by the Internet, from how we receive news and information and how we connect with friends to how we do our banking, shopping, and even how we entertain ourselves. Initially, in many ways, shopping online seemed like a variation of shopping via a mail-order catalogue – you find a store, look at the goods, specify size/colour, and place your order – but there were still some items, such as groceries, personal care products, pet products, and cleaning products (generally called Fast-Moving Consumer Goods, or FMCGs), that were considered too perishable for Internet shopping; however, this myth is rapidly being disproved. Both majority-online and brick-and-mortar businesses are expanding their Internet presence in order to meet the needs of consumers who don’t want to spend time pushing a cart through a store and e-commerce is currently the fastest growing FMCG channel and far outpacing the growth of the industry as a whole.

Starting with companies offering healthier eating options, such as FreshDirect and Peapod, and being expanded upon by others, notably Amazon.com, majority-online services have been the drivers of change for well over a decade. According to a 2016 survey, approximately 25% of global respondents already order grocery products online, with more than half of respondents (55%) willing to use such a service in the future. Essentially, by adapting the grocery store model with the supply-chain management of an online store through the use of targeted warehousing and distribution, these companies are able to offer an effective shopping experience delivered right to your door with the convenience of buying a pair of shoes from your favourite e-retailer.

Conversely, while many traditional brick-and-mortar establishments can’t magically transform into Internet companies, they are not ready to just give away market share. And while the market of e-commerce is not kind to newcomers, companies such as Walmart (Supercenters), Tesco and Safeway have been investing in new technology which allows for both a less-stressful, time-consuming experience in the store itself or the ability to skip the store altogether and have your order waiting for you by the time you pull into the parking lot. Though only 12% of global survey respondents have tried services like this, as much as 57% are willing to try these options in the future. Still, though they may be brick-and-mortar, much of this action happens because of the Internet, which can be used for placing an order, making suggestions based on recent purchases, or recording purchases and establishing a payment method, which eliminates the need for waiting in line at the checkout.

Interestingly, we are also beginning to see the establishment of hybrid companies that can offer the convenience that comes from physical store-based locations as well as an online-only presence, thanks to the Walmart’s recent acquisition of Jet.com and Amazon’s purchase of Whole Foods that resulted in over 40% price cuts on the first day of operation (28 August 2017). With more than half of all survey respondents willing to try both online and store-based services in order to purchase everyday perishable items, the market still seems very fluid; however, thanks to the choice, innovation, and dynamics of the Internet, the clear winner in all of this is the consumer.

And as the FMCG industry online sales are forecasted to hit $130 billion worldwide by the end of 2025, investing in e-commerce strategies becomes a priority for brands and retailers looking to maximize their potential to grow.

EVS Translations’ global retail solutions help monetise a brand by drafting, implementing and optimising multilingual and multinational strategies. To its clients, EVS Translations offers a full pack of e-commerce localisation services, from website translations and market testing, through SEO, SEM and email marketing, to added value services such as content discovery and legal and financial assistance.

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