The momentum of online retail and e-commerce


The momentum of online retail and e-commerce

Online retail is fundamentally revolutionizing traditional trade, and Covid-19 has only accelerated this process. Online orders have skyrocketed around the world, including the Eastern European and Middle East markets, resulting in unprecedented sales numbers. Hence, e-commerce has become an essential factor to set the foundation for future growth.  

The state of e-commerce in the Eastern European and Middle East markets

It wasn’t that long ago when we scrutinized if consumers were even willing to purchase FMCG products online, as there were several barriers that kept shoppers away from spending for groceries in the virtual space. Manufacturers and e-retailers faced trust issues from consumers, so they questioned the benefit of having an online retail presence. 

Since the initial stage of the pandemic, there have been no questions any longer. Online retail sales have showcased double-digit growth (89% in Turkey, 29% in Romania, 28% in Serbia*) in the last 12 months, substantially outrunning the brick-and-mortar sales increase.  

Online penetration is on the rise (54% in Poland, 60% in Turkey**) with a significant rate of new online shoppers (9% in Poland, 10% in Turkey). Additionally, e-shoppers are more satisfied with online shopping from Europe to the Middle East (41% in KSA and UAE).  Today, the crucial question is no longer whether people are willing to purchase fast-moving consumer goods online, but how frequently they do so, how much they spend per shop, and how they use online stores to supplement or even replace their brick-and-mortar purchases.

Astonishing e-commerce sales expansion is not the only sign that people are spending more online. We are witnessing a trend that shows consumers are willing to pay more online if this type of channel is the one meeting their needs. As an example, 72% of Polish shoppers stated that they care about quality and are willing to pay more regarding online shopping. Less Polish shoppers (67%) said the same for brick-and-mortar shopping.  

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Considering shopping experiences globally, more shoppers feel positive about the online shopping experience (53%)*** than they do about the brick-and-mortar store experience (18%).  

As consumers demand more from their shopping experience, pleasing them is a greater challenge, which means growth requires more effort and research. Many consumers will continue to increase their spending after trials, so the momentum will likely continue.  

There is no doubt that e-commerce is an unavoidable factor in future growth. The question is how manufacturers and retailers respond to the different needs the online shopping era brings their way. 

* Source: NielsenIQ Retail Measurement data. Latest year ended Sept 2021 vs. year-ago 

** Source: NielsenIQ Shopper Trends report, 2020-2021 

*** Source: NielsenIQ Future Pulse survey, April, 2021