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FMCG growth to be reignited in Asia: NielsenIQ

Mindy Tan
Published Tue, Apr 6, 2021 · 01:52 PM

EVEN as most Asian markets experienced a decline or lower growth in the fast-moving consumer goods (FMCG) sector last year, NielsenIQ Asia said it expects the pace to pick up and "normalise" this year.

On the whole, FMCG growth was flat (-0.1 per cent) in 2020 compared with 8 per cent growth in 2019 said the company. Broken down by country, most South-east Asian markets experienced a "significant decline"; Singapore bucked the trend and recorded the highest growth of 15.5 per cent.

North-east Asian markets saw "lower but reasonable growth" with China recording 3.1 per cent. India experienced an unprecedented 40 per cent decline in April 2020 due to mass store closures, but this figure bounced back to 2019 levels of 8 per cent towards the year end. As a result, India recorded overall growth of -1.9 per cent.

Justin Sargent, president of Retail Intelligence, NielsenIQ Asia, said: "There is plenty of room for opportunity and growth. We have witnessed remarkable winning stories from some brands, who have paired innovative ideas with the right in-market activation."

Notably, factors that consumers take into consideration when deciding where, how and what to shop have changed. Whereas in the past, consumers decided on where to shop based on store sizes or availability of specific products, consumers are increasingly choosing to shop based on value for money (95 per cent), low prices (75 per cent), safety and hygiene (67 per cent), wide product selection (67 per cent), fresh products (63 per cent) and convenience of location (62 per cent), noted NielsenIQ.

In addition, while traditional channels still dominate, online hyper/supermarkets ranked top for Asian consumers when asked where they plan to shop more. One in three (31 per cent) said they want to buy new products only online.

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The company has identified five key trends - convenience, services that cater to the homebound experience, alternative, natural and blends - as key growth areas in 2021.

According to the company's survey, 76 per cent of Asian consumers said services should offer more "flexible options" to suit their lifestyle at home, while 62 per cent cited convenience as a top reason to choose where to shop.

In addition, growing concern for health and the environment saw 69 per cent of Asian consumers saying they would switch to an eco-friendly brand with the same price and quality, while 72 per cent of respondents said naturally-produced products are more important to them than three years ago.

Consumers also indicated a desire for new experiences, with 73 per cent saying they want to buy new products but from brands that are familiar to them.

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