Internet to influence Rs 2.39 lakh crore of FMCG sales in India by 2020: Report

Internet would influence $35 billion (Rs 2.39 lakh crore) of total sales in India in the FMCG sector by 2020, and beauty and hygiene products sales will account for $11 billion (Rs 75,218 crore), 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% of total sales estimated to be $35 billion.

"While the total influence of Internet will impact $35 billion worth of FMCG sales, which is 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.

As per the report, online users in India will continue to see rapid adoption reaching approx 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, the report said.