Snap-shot Pack

FMCG

1
 FMCG industry is expected to double between 2016 to 2020
despite short-term pressures.

FMCG: MARKET SIZE AND GROWTH

Impact of
Demonitization
and GST

Source: IBEF
2
 Rural markets contribute to 40% of the industry revenues and has
been growing faster than the urban market in the last few years.

IMPORTANCE OF RURAL MARKET

URBAN – RURAL BREAK-UP (2017) RURAL FMCG MARKET GROWTH

3
 Modern trade constitute 9% of the overall FMCG sales which is
much lower than that of other developing or developed countries.

SHARE OF MODERN RETAIL IN FMCG

Source: Tech Sci Research

4
 Food and Beverages constitute 44% of FMCG industry.

FMCG: SEGMENTAL SHARE

Source: Tech Sci Research

5
SOME COMMON STRATEGIES ADOPTED BY FMCG COMPANIES

• Product Innovations
• High spend on advertising
• Promotions and Offers
• Premiumization
• Smaller Package sizes
• Focus on rural market
• Third Party Manufacturing
• Green initiatives
• Distribution Focus (Weighted and Numeric Distribution)

6
SOME COMMON STRATEGIES ADOPTED BY FMCG COMPANIES
•FMCG companies influence consumers with
Promotion and intelligent deals
Offers • For example, in the case of soaps &
cosmetics; 4 soap cases are offered at the price of 3,
selling the range of deodorants for men &
women at a discounted price
Product innovation seen as the major enabler for growth.
For Example,
• Colgate-Palmolive has launched a toothpaste for the
inflammatory gum problem of pyorrhea
Product Innovation
• ITC is coming up with new multigrain Bingo
and Customization
• Dabur has launched its sugar free variant for
Chyawanprash in India
• ITC has ventured in coffee & chocolates segment
under the Fabelle and Sunbean brands.

7
SOME COMMON STRATEGIES ADOPTED BY FMCG COMPANIES
•Despite the slowdown, consumers are willing to buy
premium goods at higher prices especially in categories
Premiumization
like convenience, health, and wellness
• Companies are launching premium versions in the
categories in which they operate

•Companies are increasingly introducing smaller stock

Rising Importance of keeping unit.
Small Size Packs
•This helps them to maintain volumes from price-
conscious customers and expand their consumer base..

8
SOME COMMON STRATEGIES ADOPTED BY FMCG COMPANIES

Companies are now focusing on the rural market

Focus on Rural segment which is growing at a rapid pace and
Market
focused on improving their distribution networks to
expand their reach in rural India.

•This approach has helped FMCG companies focus

on front-end marketing
Third-party
• Reservation of several items for SSI as well as
manufacturing
additional tax incentives have made 3 rd party
manufacturing a popular route for many big
players
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