E-Commerce Drives FMCG Industry Growth in the U.S.

Manufacturers and retailers of fast-moving consumer goods (FMCG) haven’t exactly been blessed with blockbuster growth in recent years. Factors such as slowing population growth and deflationary tendencies pose key challenges to the industry, while consumers enjoy the fact that they have more choices than ever.

According to Nielsen, FMCG sales at brick-and-mortar stores in the United States declined by $3 billion in the first quarter of 2017, which is a lot, even considering that Easter landed in April this year, moving $800 million in holiday sales to the second quarter.

Interestingly, a channel that is often overlooked in the FMCG landscape is currently contributing most to the industry’s overall growth: despite the fact that e-commerce only accounts for less than 15 percent of total sales for most FMCG categories in the U.S., online sales are driving the lion’s share of FMCG sales growth. As our chart illustrates, e-commerce sales account for more than 75 percent of additional dollars spent in five of the six categories displayed below.