There has been a 10X growth in vernacular ‘searches’, over 2X growth in watch time of vernacular YouTube content and 5X faster growth of Hindi content consumption on websites versus English in the last one year. With digital platforms becoming a major source of information for the masses, views of Advocates is also playing a big role in influencing the decision of the shoppers.
Google India and BCG today released a report, “Decoding Digital Impact: A $45B Opportunity in FMCG 2020”. The report projects that 40% of FMCG consumption in India will be driven digitally, translating to a value of $45 billion by 2020. The report finds that while time spent on digital is the same as TV in urban India, share of digital advertising spends by FMCG companies was only 10% in 2016. This is, however, expected to grow substantially to reach 25 -30% by 2020.
The report highlights that there will be 650M internet users by 2020, driven by increasing mobile penetration, with the highest growth coming from non-metros. Thereby reinforcing that digital in India is now a way to reach the masses, and not just a small, targeted opportunity.
This mass reach makes it central for FMCG companies and will disproportionately influence categories such as Baby care and Beauty. From an audience perspective, the report estimates that online consumers spend 2X more on FMCG purchases than offline consumers.
India’s 28 million affluent and elite households will contribute to ~40% of overall online FMCG consumption by 2020, of which 60-65% will be digitally influenced.