LONDON and PARIS, 5th June 2019 — Digital technologies are revolutionising the way the food and consumer goods industry operates and online sales are forecast to grow 163% by 2023 across major markets, according to a new report from research organisation IGD, in association with The Consumer Goods Forum.
Looking at how companies can respond to this change and how businesses will utilise digital technology to become more relevant, the report explores three digital retail models of the future and predictions for an increasingly digital food and consumer goods industry.
Major grocery ecommerce markets will continue to expand rapidly, growing at almost four times the rate of any other channel. Data highlights from the research include:
Asia and North America will lead the way on the rate of growth, with Europe set to develop this channel at a comparatively slower pace. Indeed, grocery ecommerce sales in Asia-Pacific are set to triple over the next five years, with IGD forecasting that in 2023, ecommerce’s share of grocery in Asia (7.5%) will be twice that of North America (3.4%), and close to three times larger than Europe’s (2.5%).
|Region||2018 (US $bn)||2023 (US $bn)||Sales added 2018-’23 (US $bn)||Sales growth 2018-‘23||Online share of grocery market 2018||Online share of grocery market 2023|
|All major markets||158||414||257||163%||2.5%||5.2%|
Susan Barratt, CEO at IGD, said: “We are living in exceptional times, with an extraordinary burst of retail innovation, driven largely by digital developments. With this research we explore the global proliferation of retail innovation from three different directions: established players, online specialists and the new ecosystems. We believe that plenty of the new emerging models are set to grow and prosper, which means established retailers will need to work hard and swiftly, either to limit their impact or to emulate them.
“The digitisation of the food and CPG industry has already disrupted and transformed the industry, yet the story has only just begun. To help businesses understand the opportunities and challenges that businesses face, we have identified three retail models that have developed as the food and CPG industry digitises and we project how these business models will evolve.”
IGD’s new report aims to help retailers and suppliers understand the three digital retail models of the future that will emerge from the digitisation of the food and Consumer Packaged Goods (CPG) industry. These models are:
Businesses are transforming their established operations through digital technologies to enhance their stores, reduce costs and improve connection with customers.
IGD’s predictions for rapid evolution include:
The first, mainly standardised wave of ecommerce is fragmenting in a variety of creative new ways to sell and add value.
IGD’s predictions for Ecommerce 2.0 include:
A network of retail and consumer services is emerging, linked by logistics, financial services and technology.
IGD’s predictions for Ecosystems include:
Peter Freedman, Managing Director of The Consumer Goods Forum, said: “While of course growth remains challenging for all of the established players in the industry, many are nevertheless finding that the ongoing disruption presents exciting opportunities. This report presents several ideas for consumer goods and retail companies looking to secure their long-term future, and we’ll be discussing some of these themes at the Global Summit in Vancouver: how scale and agility can impact your business model, how digital technologies will permeate decisions and how new forms of collaboration will help drive the sustainable evolution of our industry.”
For more details about the three digital retail models of the future, download IGD’s free report: igd.com/digitalretailmodels
For further information, please contact:
IGD press office
+44 (0)1923 851 924 / +44 (0)7590 183295
The Consumer Goods Forum