FMCG companies witness 50% jump in e-commerce sales

Gross e-commerce sales of top FMCG companies witnessed a spike of more than 50% in April and May, reported the Economic Times reported. The second wave of Covid-19 triggered customers to opt for online shopping as the lockdown forced everyone to stay indoors.

E-commerce accounted for 6-9% of the total gross sales for most companies in April-May. It was 4-6% in March. Online shopping is said to have increased in the past two months as Covid infections surged and caused many to shift back to the ‘work from home’ module.

“The fear to step out due to the deadly second wave, restricted store timings and convenience has spurred this jump,” Krishnarao Buddha, senior class head at Parle Products was quoted in the report.

Parle registered a 17-18% rise in gross sale contribution from e-commerce platforms during April-May. The rise in sales was observed in over 15 cities across India. The figures were around 13-14% in March this year. Companies like Dabur and ITC have also reportedly witnessed growth in sales via e-commerce platforms.

The age of contactless and touchless services have provided a significant boom to e-commerce platforms likes Amazon, Flipkart, Grofers, and BigBasket.

Most people prefer ordering groceries and other essentials online rather than risking their lives. Meanwhile, the e-commerce platforms also come up with frequent sales offer, discounts, and reward points that attract customers.

“Now that I’ve become used to ordering essentials online, it has grown to become a default process. Also, e-commerce platforms tend to give you an element of personalization. You don’t have to waste time standing in a queue to get a bill. It seems more convenient,” Partho Chatterjee from Patna said.

Many people also feel that maybe some items are priced slightly higher on an e-commerce platform when compared to a regular kirana store. However, ordering online also saves the cost of travelling and hence customers like to assume it’s a fair deal.

“There are minor price differences but overall I still think that buying anything online is more profitable. It gives you discounts and if the total bill surpasses a particular amount, delivery charges also nullify,” Seema Pandey from Lucknow said.

According to the ET report, gross sales for Grofers grew by 46% in April-May and the e-commerce platform reported over 100% development in first-time online grocery customers and expects this behavioural shift will result in mass-scale adoption of online grocery in the long term.

Most companies have expanded their e-commerce business in the past few months. Experts claim that e-commerce is highly profitable and things already look very positive for this business model in the post-Covid world.