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12 February, 2016
Executive Summary
200M+
Screenagers
250M+
Rural Users
650M
90%+
On mobile
~350M
40%
transacting
online
2015 2020
Source: Adding to Cart (Bain-Google Study, 2015)
with consumers spending more time on internet
50%
online at least once a day1
1.5x
time spent on smartphones vs. TV2
1/4th
online while watching TV
Note: 1Refers to total surveyed population, N = 5000 – Consumer Barometer 2015; 2N = 4000 smartphone users - Ercisson Consumer labs survey
Source: Consumer Barometer 2015
FMCG expected to witness high Digital Impact
1/3rd 8-10%
($35Bn) FMCG spends
FMCG sales
to be digitally
to move online*
influenced
CAGR
2/3rd
10% ($11Bn) B&H spends to be
digitally influenced
20%
~$17Bn ($3Bn) B&H sales
to move online
~$10Bn
2x 2-3x
Spend vs Penetration vs
Non digital Households1 Non Digital Households
Note: 1Total spend per digital HH on a basket of 20 FMCG categories vs Non digital HH; 2Face wash, Hand wash, Deo specific examples
Source: IMRB Kantar Worldpanel 2015; Bain Analysis
Rising digital influence evident in high share of searches
3rd largest in shopping searches and growing the fastest
Apparel and
accessories
Mobile Beauty and
24% phones personal
Consumer
care
17% electronics
14%
10%
Growth
rate
28% 7% 33% 25%
Source: Google Search data from Jan-Dec 2015. Growth rates are for growth in search volumes in Oct-Dec 2015 over 2014
And rising demand for beauty video content
Hair Care
PLANNING THE
89% 93%
PURCHASE
1 out of 4 2 out of 3
RESEARCHING
ONLINE
25% 64%
1 out of 8 1 out of 2
BUYING ONLINE
3% 33%
High
Use digital to …
Drive adoption Drive Premiumization
Brands/ products Searches
Convenience Information
Deals Assortment
Why Assortment Genuine
Source: Based on insights shared by an online grocery retailer and a beauty ecommerce player
Digital is disrupting established ways of doing business
Note: Nyx – US based cosmetics brand; Sephora – French based cosmetics retailer; Jahwa – China based skin care co
Indian FMCGs are gearing up to address this fast–
paced change
~6-8%
For lead
categories such
as makeup
~8-10%
~2-3%
~1-2% ~5%
Note: 1Illustrative, data for sample set of leading CPG Cos in India with material presence in Beauty and Hygiene
And looking for solutions to address concerns
“The biggest problem with “Beauty categories pose the “Currently, Digital is synonymous
Digital spend is that there are limitation of touching and with E-Commerce. CPGs should be
no ways to measure its feeling the products before any thinking about Digital more
effectiveness.” purchase is made.” expansively”
BU Head, leading FMCG CEO, leading Personal Care FMCG ED – Personal Care , leading FMCG
Consumer Insights
Ad Effectiveness Tests educating user-
Fulfilment
customers generated
Sales Impact Tests content
DELIVER &
Overall STOP AND CHOOSE WHERE DEFINE RE-ALLOCATE
SUSTAIN
approach RETHINK TO FOCUS SUCCESS RESOURCES
CHANGE
• Integrate
• Seamless • Shift media
digital across
• Digital’s online and • Clarity on how spends –
the value
impact based offline digital fits follow your
chain
on actual experiences within the consumer
consumer brand’s • Invest in new
• Sources of • Invest in
behavior strategy capabilities
digital technology/
and
differentiation IT/ Analytics
partnerships