Internet to influence $35 bn FMCG sales in India by 2020: Report

The report says beauty and hygiene products sales will account for $11 billion

Internet would influence $35 billion of total sales in India in the fast moving consumer goods (FMCG) sector by 2020, and beauty and hygiene products sales will account for $11 billion, says a report.

The report, released jointly by Google and Bain & Co, projected that an estimated 130 million Indians will shop online by 2020, making Internet a prominent sales channel forming 20 per cent of total sales estimated to be $35 billion.

"While the total influence of Internet will impact $35 billion worth of FMCG sales, one-third of total sales in India, beauty and hygiene will see two times higher impact as more and more users get online to research in this category. Internet would influence $11 million of the total sales in the FMCG sector for beauty and hygiene products by 2020," the report said.

According to the report, online users in India will continue to see rapid adoption, reaching around 650 millon by 2020.

"Over 200 million women will be online, with Internet reaching over 250 million rural users in India by 2020," it added.

Google India Industry Director Vikas Agnihotri said: "FMCG companies in India need to start thinking of digital as a more strategic medium and chart out a digital growth path for their products."

Beauty & hygiene-related searches on Google makes it the third largest vertical for shopping related searches -- behind apparels & accessories and mobile phones.

With growing penetration of Internet beyond urban India and online shopping growing, there is a huge opportunity waiting to be unlocked by FMCG players in the country, report said.