Overview Agility is key in keeping pace with dynamic changes in the business

Overview environment.
In the FMCG retail industry, the disruptions brought about by the
pandemic are causing deep transformations. Today, e-commerce
has emerged as an indispensable retail channel, fulfilling the
concept of “agility”. It is now a critical engine for business growth
and is expected to grow in importance for years to come.
NielsenIQ E-Commerce Snapshot presents a wide view of the
e-commerce landscape to help brands and retailers strategize and
thrive for success in this ever-changing retail environment.
E-commerce Snapshot In this report, you can find answers to how e-commerce is evolving
and expanding in regions and markets. You will also learn essential
information about the attitudes and behaviors of online shoppers
Seeing the across the globe.

big picture of
e-commerce Content ▪ E-commerce performance globally

▪ Online shopper behavior and rise of omnishopping

The rise of online is disrupting the
course of the FMCG industry. ▪ E-commerce growth factors
This report shows the latest data
on e-commerce landscape to help ▪ Key takeaways
you identify the right strategy and
drive deep rewards for your business.

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© 2022 Nielsen Consumer LLC. All Rights Reserved.
 1. E-commerce has become
the accelerator of retail growth
It was not long ago when trust, shopping experience, payment options and security as well as
delivery logistics were among the barriers to e-commerce adoption and growth. Attitude
towards these concerns have changed when health safety and mobility issues brought about by
the pandemic, triggered dramatic alterations in shopper behavior. This change has effectively
pushed brands, financial and logistics companies to quickly innovate so they can hurdle these
roadblocks and answer the consumers' needs.

E-commerce is now in hyperdrive and accelerating the shift to online shopping. Globally, the
value growth of e-commerce channel increased by 14.5% versus the year before. Today,
e-commerce fuels retail growth around the globe, with online sales rapidly outpacing offline by
double digits in many countries across Europe, the Middle East, and Latin America.

Total FMCG global perfomance E-commerce global perfomance

% value growth vs YA % value growth vs YA

3.5% 14.5%

Q4 2021 Q4 2021

Source: NielsenIQ RMS FMCG MAT Q4 2021

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Diverse regional landscape
Rising global online FMCG businesses generate extreme sales numbers, but ways and trends of the regional markets can differ significantly.
• E-commerce now accounts for nearly 20% of FMCG sales in Asia Pacific and it is the second biggest retail channel. In Korea and China, more
than 30% of FMCG sales are coming through e-commerce.
• In the Middle East, e-commerce is driven by a digital-first approach economy. The changes in shopping behavior are reflected in the pace of
online channel growth which almost doubled in UAE and KSA in 2021 compared to 2020.
• Markets in Europe have gone through a quick commerce revolution and now face extreme fragmentation, although the growth rate of online
FMCG versus offline is remarkable.
• Latin America is on a steep growth curve with online consumer goods sales increasing by 35.4% in 2021

Regional e-commerce contribution & growth FMCG e-commere performance across regions
in 2020 in Q4 2021

E-commerce sales growth E-commerce % of total retail Total FMCG growth E-commerce growth

25% 67,6
Asia Pacific
16%
13%
West Europe
17%
7%
Central & Eastern Europe
22%
3%
Africa & Middle East
20% 19,3
6% 12,1
Latin America 8,1
19% 6,9
4,2 3,3
1,1
14%
North America
18% North America West Europe East Europe Asia Pacific &
China

Source: NielsenIQ eMarketer September 2020 (by Region) Source: NielsenIQ RMS FMCG MAT Q4 2021
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E-commerce is growing globally with some countries taking the lead
China leads the way with 10 trillion yuan (1.57 trillion USD) spend online in 2021, which is almost a quarter of the total retail sales of consumer
goods. Following is South Korea with predominance of digital wallets and the rising influence of super-apps. The U.S. is among the top five
e-commerce countries serving 12% of total consumer goods sales for the market and up to 30% of sales in global markets.
The U.K. is the most mature European e-market, where fresh food categories have a significant role in online platforms, generating 9.7 billion
pounds for digital commerce. Pandemic catalyzed the growth of the online channel, which gained, only during 2020, +8M new FMCG buyers in
Mexico. Interestingly, that 72% of Mexican online purchases were driven by promotions in 2021.

E-commerce value split in FMCG sales (%)

YTD 2020 YTD 2021

China* 25.0% 30.0%
South Korea* 22.0% 26.0%
U.S.* 9.0% 15.0%
U.K. 10.4% 14.9%
Mexico* 3.0% 12.0%
Taiwan* 8.0% 10.0%
France 8.1% 8.8%
Brazil* 4.0% 8.0%
Turkey 3.9% 6.2%
Netherlands 3.8% 5.6%
Sweden 2.5% 4.5%
Denmark 2.9% 4.2%
Spain 2.2% 2.8%
Portugal 1.6% 2.6%
Italy 1.8% 2.4%
Finland 1.5% 2.3%
Hungary 1.0% 1.3%
Germany 1.0% 1.2%
Switzerland 0.6% 0.8%
Poland 0.3% 0.3%

Source: NielsenIQ Retail & Consumer Panels

*China, South Korea, U.S., Mexico, Taiwan and Brazil data belongs to 2020 pre-pandemic & post-pandemic periods
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 2. Shoppers tend to spend more time
and money online
Looking deeper into the e-commerce landscape, not only are the markets fragmented, but
online shoppers behave quite diversely at different maturity levels. Consumers now seem more
comfortable accessing an online assortment of products as the technology of omnichannel
services evolve. Shoppers are aware of the breadth of products available at their fingertips
digitally and are on the lookout for the best potential deals.
Shoppers around the globe find e-commerce attractive not only because of the need for
convenience, but also for the better offers made available online. While some online
shoppers still have concerns around trust and delivery, many are taking the buying experience
into account: How long it takes to complete a purchase and whether it was a smooth process.

Online Number of new online Online penetration is on the rise with a

penetration shoppers in 2020 significant increase in the number of new
online shoppers. Today, the crucial
+111M in China
question is no longer whether people are
+17M in Brazil willing to purchase fast-moving consumer
goods online, but how frequently they do
+8M in Mexico
so, how much they are willing to spend
+922K in South Korea online, and how they use online stores to
supplement or even replace their brick-
Sources: NIQ Consumer Panel Services 2020;
NIQ Homepanel Post ECQ Survey Oct 2020;
and-mortar purchases.
Shopper Trends

Online E-commerce sales expansion is % online spending growth

spending not the only sign that people are
spending more online. We are Indonesia +43%
witnessing a trend that shows
India +36%
consumers are willing to pay
more online if this the retail Thailand +27%
channel that meets their needs.
Singapore +16%
Brazil +5%
Sources: NIQ Homescan; Thai Shopper Frequency
(Nov-Dec 2019 vs. Feb 2021); Shopper Trends India,
2021, NIQ Ebit 2021 5
© 2022 Nielsen Consumer LLC. All Rights Reserved.
The rise of omnishopping
It's no longer a surprise to see shoppers walking up and down the aisles of brick-and-mortar stores with their mobile phones in hand as they
search for product information, compare the best deals and delivery options. In fact, NielsenIQ found that globally, almost 50% of consumers
state that they shop online and offline for their weekly groceries compared to 41% who shop exclusively in offline channels, and only 9% who
shop purely online.
The rise of omnishopping can no longer be ignored. Brands and retailers must fully understand omnishopper behavior and invest to create a
seamless online and offline shopping experience for consumers.

Regular weekly shopping channels Capture the growth in omnichannel

% of shoppers who normally visit these channels to do their weekly grocery shopping

In the U.S.,
40% of FMCG shoppers are
omnishoppers

+
In China,
Exclusive Offline Omni (Offline & Online) online-to-offline channel grew by

41% 49% 78%

Global
In Thailand,
omnishopper spending is 2x
higher than offline

Exclusive Online In India,

average monthly grocery spend
9% online is 1.5x higher than offline

Source: NielsenIQ 2022 Consumer Outlook Survey, Dec 2021 Sources: NielsenIQ e-com panel, 2nd Half of 2020 vs. year-ago,
60 consumer goods categories; Thailand CPS June 2021 ;
Shopper Trends, NielsenIQ’s Omnishopping Fundamentals
Survey
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 3. Key growth factors for e-commerce
channel now

Choice is high on the list of purchasing influences. From an online perspective, shoppers are
aware of the breadth of assortment available digitally at their fingertips. For example, in the
average supermarket or hypermarket across Asia, there are between 75-90K items on the shelf
compared to e-commerce super apps which have between 1-1.5M items, available 24/7.
The need for wider variety of products increases and making this one of the main factors for
choosing online channel. The statistics show the rise of importance of this factor for online
shopper which creates better online experience.

Importance of online shopping attribute: wider variety of products

Ranking and shifts year-over-year by market

Rank in 2020 Rank in 2019

Spain 4 23 +19
Denmark 8 25 +17
Belgium 4 17 +13
Netherlands 5 15 +10
Finland 14 22 +8
Source: NielsenIQ Shopper Trends 2020-2021 vs 2019-2020

Considering shopping experiences globally, more shoppers feel positive about the online
shopping experience (53%) than they do about the brick-and-mortar store experience (18%).
Consumers also want the ability to choose online or in-person shopping (from the same brands)
at any time. As consumers demand more from their shopping experience, pleasing them is a
greater challenge, which means growth requires more effort and research.
There is no doubt that e-commerce is an unavoidable factor to future-proof your growth. The
question is how manufacturers and retailers respond to the different needs the online shopping
era brings their way.

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Categories driving online sales
It is not a surprise that the most popular category for online purchase is non-grocery items, followed by health and beauty products. People are
more trusting to buy these kind of products online. Although we are seeing a new trend emerging: historically, shoppers had barriers to buying
fresh category online, but it’s now becoming evident that shoppers around the world are getting more confident buying it via online channel.
The U.K. is leading the way - despite lagging its share of store sales by nearly 10 points, the fresh category makes up 34.9% of total online grocery
sales (when it represents 43% of in-store sales).

New behaviors that emerged as pandemic solutions are likely to stick around for good., as some households have changed the way they shop
and the way they consider e-commerce. Every manufacturer, retailer, and brand need to understand how to capitalize on these evolving and
increasingly complex sales opportunities.

Global top 3 categories purchased online

Non-grocery 9,4%

Healthy & beauty 7,8%

Food 4,9%

Source: NielsenIQ Homescan Total Tracked CPG Sales –52 weeks to July 3, 2021. Omni Shoppers

Fresh categories boosting e-commerce

Fresh products performance Online Offline

Buyer % change +24% +0.2%

$ volume % change +61% -4%17
Frequency +26% -3%15
Purchase size +5% +1%

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© 2022 Nielsen Consumer LLC. All Rights Reserved. Source: NielsenIQ Omnichannel Shopping Fundamental Survey Wave 4: Vaccine Rollout April 2021
 Power your e-commerce strategy

Key takeaways As online and omnichannel continue to grow in importance, the only path
to clarity is understanding consumers' behaviours in line with the ever-
changing retail landscape. Here are several recommendations:

• Maximize omnichannel performance by understanding your business in

the context of the total omni marketplace
• Refine strategic investments to meet the needs of both current and
future omnishoppers
• Make online magnetic by transforming online traction into constant
trade

Solve & Augment

Differentiate Choice
On shopper need, Simplify selection
drivers and gaps in more tailored
Quest for ways
Convenience Engagement,
Remains key – Experience &
enhance ease Loyalty
Full Speed and efficiency Across
Ahead Cost omnichannel
As out of home Consciousness
behavior shifts, Keep value in
balance the spotlight
speed/cost

Let's talk e-commerce! Contact us for accurate data and actionable insights.
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