From one-click ordering to smart home devices: IRI’s 8 key trends in e-commerce

By Katy Askew contact

- Last updated on GMT

©iStock/Ali Kerem Yücel
©iStock/Ali Kerem Yücel
Shopper insight provider IRI suggests e-commerce offers “huge opportunities” for food retailers and manufacturers to meet the needs of a new generation of shoppers. In order to capitalise, the industry must respond to eight key emerging trends.

According to a new report from big data and predictive analytics provider IRI, while supermarkets remain the main destination for grocery shopping, new growth opportunities for FMCG retailers and manufacturers are emerging online.

IRI’s E-Commerce in FMCG report revealed that although the online market share of FMCG is still low compared to other sectors, online sales are booming in Europe. E-commerce sales showed double-digit growth in Italy, where sales rose 42% year-on-year, and Spain, where sales increased 29%. IRI also noted “dynamic performances”​ in e-commerce markets in France and Germany.

Sales of food and personal care in particular are “over performing”​ in e-commerce and are set to jump by 54% in the next five years, IRI noted.

The FMCG market is ripe for further disruption online, IRI solutions and innovations analyst Pierluigi Carlini suggested. This will be supported by the formation of new partnerships and emergence of new distribution, Carlini predicted.

“The traditional grocery landscape is being disrupted as influential online players reinvent the food and drink shopping experience, and smaller specialists offer a more personalised approach to consumers.

“We believe there are huge growth opportunities for FMCG retailers and brands to use their online platforms and data to help meet the demands of today’s younger shoppers who expect a seamless, effortless online experience, combined with value for money, product choice and availability,”​ Carlini said.

IRI’s eight ‘key trends’ in e-commerce

Within the E-Commerce in FMCG​ report, IRI has pinpointed eight key trends that will enable the industry to identify opportunities within e-commerce.

  1. Big data management:​ Big data is facilitating "detailed understanding"​ of individual shopper journeys and buying habits, IRI noted. This is allowing food makers and retailers to develop personalised recommendations and design studios, greater convenience and loyalty.
  2. Geo-marketing: ​New capabilities to target marketing based on location data is enabling food makers to pulls in on-the-go consumers or encourages impulse online buying for those in transit, IRI said. Promotions to prompt in-store footfall or impulse spend online can be laser focused on appropriate consumers through geo-location tech. 
  3. One-click ordering:​ Amazon’s one-click ordering patent expired in 2017. This opens up the market for online retailers who will use one-click ordering technology to tackle the problem of cart abandonment. "The quest for online retailers to alleviate shopping cart abandonment will see FMCG and non-FMCG players focus on a shorter path to purchase,"​ IRI predicted. 
  4. Shopping by smartphone: ​ Over half of UK shoppers prefer using retailers’ smartphone apps rather than their website. This trend is expected to continue gaining steam. 
  5. Targeted rewards:​ Targeted, instantly redeemable rewards strengthen customer loyalty and win share of wallet, IRI noted. 
  6. Voice ordering:​ Voice ordering via smart home devices provides convenience for shoppers. The integration of new platforms will be essential to ensure a seamless, omnichannel experience, IRI warned. 
  7. Multiple purchase platforms:​ The ability to deliver an omnichannel experience offers shoppers "versatility, speed and convenience"​. An ability to pivot between click and collect and home delivery in less time is high on retailers’ agendas, IRI said. 
  8. Direct to consumer:​ Fast-growing FMCG brands such as Graze and Dollar Shave Club (both now owned by Unilever) have focused on direct to consumer models. Start-ups and larger players can in-part remove retailers in a bid to drive loyalty, personalised offers and repeat purchase, IRI observed. 

Related topics: Market Trends

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