Online stores thrive in slow economyWhat types of spending patterns take hold among consumers during an economic downturn? Nielsen Korea, a data analysis company, yesterday released its Fast Moving Consumer Goods report for the second half of last year, which showed a rise in online shopping but a .05 percent fall year-on-year in total sales volume of consumer goods.
“There are expectations that the global economic growth rate will pick up in 2014 with gross domestic product growth improving in major countries recently,” Nielsen Korea said in a statement on the spending patterns report. “But as for Korea’s economic growth, it is still not able to escape from the recession due to [mounting] household debt and falling purchasing power. This is affecting the domestic consumer goods market.”
Although consumers are spending less, Nielsen Korea said that people are purchasing goods by different means based on changing social trends.
According to Nielsen Korea, the portion of sales from online malls of the country’s three large discount stores - E-Mart, Lotte Mart and Homeplus - increased 25.5 percentage points from July to December last year compared to the previous year. Popular items to buy online included diapers, with sales up 31.8 percent year-on-year, facial tissues (24.7 percent), paper towels (29.3 percent) and toilet paper (20.7 percent). Online sales of coffee powder also increased by 33.9 percent and mineral water was up 24.6 percent.
“This shows that large discount stores have put effort into diversifying [sales] channels by enhancing online mall services at a time when their offline operations have been much restricted by the government’s regulations,” the statement said.
Another trend noted in the report was that in an economic slump, though consumers cut back on spending by not dining out, they still eat well at home. For example, sales of sparkling wine jumped 25.7 percent and sales of red wine increased 32.4 percent. The growing sales of wine coincided with a14.4 percent jump in cheese sales.
BY lee eun-joo [firstname.lastname@example.org]
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