NielsenIQ: PH households increased online shopping by 325% in 2020

Online sales for FMCG did not stem from increased spending by existing online buyers but from the rising numbers of households buying online and from increased frequency in buying and spend. According to NielsenIQ, a global measurement company, this signals the end of the beginning of e-commerce in Asia.

NielsenIQ, warns retailers that as e-commerce transitions to the next phase, there are five challenges that retailers need to face:  greater fragmentation in retail, redefining of the role of physical stores, divergent realities, increased fight for consumer attention, and the race to last-mile fulfillment.

“We have entered the end of the beginning of e-commerce in Asia and those who rest now will sleep through the most formative time of growth for e-commerce,” states Vaughan Ryan, Nielsen IQ’s consumer intelligence managing director in Asia.

“The technological advancements and creativity of the last decade have made the retail world more advanced—leading to an environment where trust is solidified, where it is more than logistics but more about pushing the envelope on personalized discovery and curation, where there is exploration of new categories, and seamless omnichannel integration.”

While e-commerce has been viewed to transform retail, Covid-19 accelerated its trajectory to its readiness to transition to the next phase.

The growth in the Philippines is the most dramatic due to stricter movement controls in 2020, recording +325% increase in households shopping online. NielsenIQ further notes that 67% of consumers who have purchased online plan to continue to buy online even after quarantine restrictions are removed.

“This signals a more permanent transition towards a brick-and-click shopping behavior where both formats influence the final purchase decision,” say Pauline Jill Uy-Yu, NielsenIQ’s consumer intelligence head in the Philippines. “As consumer  habits continue  to  evolve, it's important for retailers to track performance versus competition or risk becoming obsolete to the omni-shopper."