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FMCG Sales Growth Sinks In 2016

Feb 10, 2017 | Emerging Trends Advisors

THAI shoppers remain cautious in their purchases of fast-moving consumer goods (FMCG), with sales-growth rates last year hitting the lowest point in a decade, according to Kantar Worldpanel.

However, the market-research firm also suggests that online retail business is presenting a huge opportunity for the FMCG sector as consumers’ purchasing patterns are tending to move into digital commerce.

Aitsanart Wuthithanakul, new-business development manager at Kantar Worldpanel (Thailand), said yesterday that last year’s growth of 1.7 per cent in consumer-product sales was the lowest in 10 years because of weak consumer confidence amid high levels of household debt and the effects of severe drought on the agricultural sector.

FMCG sales growth sinks in 2016
FMCG sales growth sinks in 2016

 

“Besides being hard hit by those negative factors, consumers particularly in rural areas are now tightening their belts and considering the purchase of necessary items only, while other shoppers remain cautious about the current situation,” Aisanart Aitsanart said. According to data collected by the market-research company, sales in the food-preparation and household-product categories are likely to grow this year. Those products include coconut milk, soymilk, bottled water, beer, meal makers, rice, canned fruit and floor cleaner.

The personal-care category is expected to follow the same growth path, particularly in the e-commerce channel.

Aitsanart also said that even though online shopping still accounted for only a small portion – 0.6 per cent – of total retail sales, purchases via this channel were accelerating, mainly of personal-care products, which account for 80 per cent of total spending via online shopping.

The total sales value from online shopping was Bt2.47 billion last year, up from Bt1.18 billion in 2015, Bt660 million in 2014, Bt323 million in 2013 and Bt67 million in 2012.

While traditional trade is continues to be squeezed, Aitsanart said that marketers and corporates should learn how to create proper marketing campaigns to engage with target customers through the right sales channels as well as offering the right package sizes |and prices to help consumers feel more comfortable about making a purchase.

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