From groceries to electronics, clothes to laundry detergent, consumers are turning more and more towards e-commerce for everyday items and retailers want to be ahead of the game this time around. Packaged goods is now a $12 billion business across a host of pure-play e-commerce players such as Amazon and Drugstore.com, and multichannel players such as Walmart.com and Target.com
Some 10% of consumers bought consumer packaged goods via e-commerce last year, double the amount from 2009. Nielsen Co. projects e-commerce will rise from around 6% of total packaged-goods sales in 2009 to 10% by 2015 in the U.S., surpassing club stores and matching drug-stores’ share.
Last year saw the launch of several new online retailers specializing in packaged goods, including Alice.com, Soap.com, Petflow.com and Procter & Gamble Co.’s own PGestore.com. Then came Amazon’s $450 million acquisition of Quidsi (owner of Diapers.com and Pets.com) and Walmart.com’s counterattack, which saw the retailer adding thousands of CPG items it hadn’t sold online for years since a lukewarm consumer response to the idea a decade ago.
Sales of packaged goods has plenty of room to grow, too. Household penetration of online packaged-goods shopping is still well below the 25% level in the U.K., for example. Amazon announced that packaged goods are a major piece of its strategy to quadruple its sales to $100 billion.
How are people shopping for packaged goods?
About 30% of online packaged-goods shoppers go through online “aisles” in a fashion similar to offline shoppers — 40% primarily use the online search box to look up categories or brands and another 30% work off auto-replenishment lists or saved shopping lists, among those 40% of shoppers using the search box, 95% of sales go to products that come up on the first page of search results.
Information from Etailing Solutions