While global shoppers report being highly interested in purchasing fast-moving consumer goods through e-commerce options like virtual supermarkets, online automatic subscriptions and ordering online for delivery to home, brick-and-mortar channels are still the predominant go-to-source for shopping. And when it comes to channel choice, bigger is not always better.
In developed markets, retail sales are concentrated in large supermarkets and hypermarkets, accounting for 61% of personal care, 62% of food and beverage and 79% of household care category sales. In the food and beverage category, convenience stores are also a sizable player, accounting for 20% of sales. Similarly, in personal care, 22% of sales come from drug stores.
Meanwhile, in developing countries, the landscape is more fragmented. Food and beverage is the most concentrated category; 45% of category sales come from traditional stores. Personal care and household product category sales, on the other hand, are divided across five channels: drug stores, hypermarkets, large supermarkets, small supermarkets and traditional stores. Hypermarkets and supermarkets are growing in these markets, but the importance of traditional channels should not be ignored due to their size and importance in the majority of categories.
For all three categories included in the global study, the largest trade channel was not the one with the highest growth rate, indicating that global share of trade is becoming more fragmented. In the food and beverage category, traditional stores are growing fastest (+5%). Supermarkets and hypermarkets are still important to these categories, but consumers are increasingly relying on smaller formats such as traditional stores and kiosks, which fulfill their needs for convenience and speed. The story is similar for household product and personal care categories. Hypermarkets still claim the largest share of trade, but drug stores and convenience stores are growing more quickly.
“Large supermarkets and hypermarkets are important players in the global retail landscape and this will continue well into the future,” said Dodd. “But smaller formats claim considerable share in some categories and are growing in others. Distribution efforts must rely on a mix of both. Understanding where consumers are shopping and for what categories gives the insight needed to develop more precise, market-by-market distribution strategies.”
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The findings in this survey are based on respondents with online access across 60 countries. While an online survey methodology allows for tremendous scale and global reach, it provides a perspective only on the habits of existing Internet users, not total populations. In developing markets where online penetration has not reached majority potential, audiences may be younger and more affluent than the general population of that country. Additionally, survey responses are based on claimed behavior, rather than actual metered data.
Sales data is from Nielsen’s syndicated Retail Measurement Services database. To examine change over time, data was collected for the latest two years (or three where available) and the most recent 12 months. Collection dates vary by country and category, but most were between September 2014 and January 2015. Sales are in USD and adjusted for inflation. Given the challenges of collecting and harmonizing data for 40 countries, data was collected from all available channels only for 31 selected product categories. Not all channels are covered in every country, nor are all products tracked. E-commerce sales are not included.
The following countries were included in the analysis: