GURGAON: Reckitt Benckiser, the consumer goods business, anticipates that in future almost one third of its sales in India will come via mobile commerce, a leading executive has said.
Nitish Kapoor, regional director at Reckitt Benckiser South Asia, made the remarks in conversation with the editor-in-chief of Businessworld at the launch of the latter's Marketing Whitebook.
Kapoor noted that currently ecommerce accounted for maybe only 0.5% of all FMCG sales in India, a proportion that was predicted to grow to anywhere between 3% and 5% over the next five years, Exchange4Media reported.
"China moved from this level to 15% in less than seven years," he said. "For us, we can see up to 30% of our business coming from m-commerce, not e-commerce."
He was less concerned about the price points of individual products online than the fact that Reckitt Benckiser had a wide portfolio of products available across the household products, health and hygiene categories.
Typical prices might range anywhere between Rs 100 and Rs 500, but, he added, "we launched a product that was priced at Rs. 3000 ($47), and 90% of our sales – multiples of Rs. 10 crore – are coming from online".
His approach to spending on digital advertising was similarly pragmatic. When deciding where to allocate resources, "it primarily depends on the product categories, reach, cost and effectiveness.
"For example, 100% of our spends for Durex are on digital," he explained. "This is because we believe we have a very narrow audience to focus on, and we can achieve high effectiveness by the digital route."
And, of course, digital will only become more significant in the years ahead, as prime minister Narendra Modi emphasised earlier this week when launching Digital India Week. He spoke of his dream of "a digital India where high-speed digital highways unite the nation" as he sought to avoid a divide between digital haves and have-nots.
While his focus is on the use of digital to improve governance, health and education, the investment in infrastructure and high-speed broadband that will be necessary to turn dream into reality will ultimately benefit brands as well.
Nitish Kapoor, regional director at Reckitt Benckiser South Asia, made the remarks in conversation with the editor-in-chief of Businessworld at the launch of the latter's Marketing Whitebook.
Kapoor noted that currently ecommerce accounted for maybe only 0.5% of all FMCG sales in India, a proportion that was predicted to grow to anywhere between 3% and 5% over the next five years, Exchange4Media reported.
"China moved from this level to 15% in less than seven years," he said. "For us, we can see up to 30% of our business coming from m-commerce, not e-commerce."
He was less concerned about the price points of individual products online than the fact that Reckitt Benckiser had a wide portfolio of products available across the household products, health and hygiene categories.
Typical prices might range anywhere between Rs 100 and Rs 500, but, he added, "we launched a product that was priced at Rs. 3000 ($47), and 90% of our sales – multiples of Rs. 10 crore – are coming from online".
His approach to spending on digital advertising was similarly pragmatic. When deciding where to allocate resources, "it primarily depends on the product categories, reach, cost and effectiveness.
"For example, 100% of our spends for Durex are on digital," he explained. "This is because we believe we have a very narrow audience to focus on, and we can achieve high effectiveness by the digital route."
And, of course, digital will only become more significant in the years ahead, as prime minister Narendra Modi emphasised earlier this week when launching Digital India Week. He spoke of his dream of "a digital India where high-speed digital highways unite the nation" as he sought to avoid a divide between digital haves and have-nots.
While his focus is on the use of digital to improve governance, health and education, the investment in infrastructure and high-speed broadband that will be necessary to turn dream into reality will ultimately benefit brands as well.
Data sourced from Exchange4Media, Hindustan Times; additional content by Warc staff
