Some unexpected categories are boosting online share

Growth in ecomm sales of hot beverages, deli meat and OTC medicine are among the 'behavioural resets' Nielsen has identified.

Grocery, CPG, retail

It’s not just conventional food items that consumers are increasingly snapping up online.

Hot beverages, baby care and over-the-counter products are also seeing a large pickup in omni shopping share, according to Nielsen, whose latest analysis of the Canadian FMCG industry also shows that brands of all stripes need to focus on health propositions and innovation.

While baking goods and prepared foods grabbed most of the headlines with extreme growth spikes in the pandemic, the new normal omni-shopper is embracing the ecommerce experience in other, novel areas (see, below) according to 52-week data compiled by the data and measurement firm, ending Dec. 2020.

For example, the share of hot beverages purchased online is now 7.9%, up 110 points, while baby care is showing a 9.9% share, up 87 points. Over-the-counter health products are at 6.4%, up 80 points. Deli meats have a 6.3% share, up 119 points.

“I try to look at this simply: shoppers like convenience,” says Mike Ljubicic, EVP of North American retail at Nielsen. He adds that the “new normal” means a certain percentage of people will be increasing the time they spend working from home, irrespective of broadly available vaccines. “It’s not going to go back to the way it was before,” Ljubicic adds.

FMCG-categories

“We saw 67% growth in ecommerce in Canada. It’s a huge new population of users that came into the CPG environment in 2020, and realized that whilst not perfect, it’s really delivered on convenience and safety,” says Laura McCullough, EVP of client success for Nielsen.

Consumers will be undergoing behavioural resets for the foreseeable future, McCullough predicts.

One such reset is challenger brands. Small, single category DTC players, which had been making significant inroads into the CPG space pre-pandemic, are now stalling thanks to the ability of more established, larger brands to maintain supply chains.

However, McCullough sees opportunity for smaller players to combat the big brand volume resurgence, by focusing on health and hygiene efficacy claims to sustain and build momentum.

And while some brands, regardless of size, have pumped the brakes on the innovation side of things, she says that’s a mistake.

“Companies that innovate through a crisis are ones that come out of crises in a much better position,” she maintains, extrapolating from prior economic slumps. There are many ways to stay relevant, including shifting consumption patterns at home to meet continued needs and also providing health and immune and germ-killing assurances, “what consumers are craving,” according to McCullough.

According to BrandSpark brand trust data released this week, 71% of consumers say they are likely to try innovations from the brands they trust most.