Fast Moving Consumer Goods: Made by Kanika Sikand Anubha Jain

FMCG
FAST MOVING CONSUMER

GOODS
MADE BY
KANIKA SIKAND
ANUBHA JAIN
INTRODUCTION
The Fast Moving Consumer Goods

(FMCG) sector is the fourth largest sector
in the economy with a total market size in
excess of Rs 60,000 crore. This industry
essentially comprises Consumer Non
Durable (CND) products and caters to the
everyday need of the population.
FMCG PRODUCTS
Detergents Shampoos
Confectionaries
Soaps
Beverages Creams
PRODUCT CHARACTERISTICS
Products belonging to the FMCG segment
generally have the following characteristics:
 They are used at least once a month

 They are used directly by the end-consumer
 They are non-durable
 They are sold in packaged form
INDUSTRY VARIANTS
Branded and
Personal Household Packaged
care care Food and
beverages
India – a large consumer goods spender
15
40 10
11
16
8
Savings Others Clothings
Entertainment Personal Care Grocery

CHANGING SCENARIO
 1950’s-80’s – Low Investment in the sector
 Low purchasing power
 Govt’s emphasis on small scale sector
 HLL and other company’s urbane focus
 Post liberalization
 Entry of MNCs
 Focus shifted to getting to rural consumer first
 Others, like Nestle, remained with the urban population
 Latest fad to hit the market is the ‘sachet’ bug.
 Mushrooming of regional brands
 Nirma enters and changes the focus to ‘Value for Money’ in the 70’s
 Post liberalization, Jyothi Laboratories, ‘Ghari’ Detergent and ‘Anchor’
toothpaste giving the nation-wide brands a run for their money.
LATEST SCENARIO IN FMCG MARKET
 Increasing per year with the growth rate of 9
percent
 Price of raw materials are decreasing
 Cost of machinery required for consumer goods

are less then durable goods.
- mint newspaper 23rd dec 2010

WHY INDIA ?
1. Large Domestic Market:-
2. Large Consumer Goods Spender
3. Changing Lifestyles:-
4. Retailing – New growth area
5. Demand & Supply Gap

SWOT ANALYSIS
Strengths:
 Well-established distribution network extending to rural
areas.
 Strong brands in the FMCG sector.
 Low cost operations
Weaknesses:
 Low export levels.
 Small scale sector reservations limit ability to invest in
technology and achieve economies of scale.
 Several "me-too’’ products.
SWOT CONTD…
Opportunities:
 Large domestic market.
 Export potential
 Increasing income levels will result in faster
revenue growth.
Threats :
 Imports
 Tax and regulatory structure
CHALLENGES
 Need gap
 Scattered market
 Communication gap due to many languages and
dialects
 Traditional outlook
 Lack of proper medium of communication.
 Low literacy level
 Prevalence of spurious brands and seasonal income
MARKETING STRATEGIES
INCREASE IN PRICE
 Surf Excel price hike from 13 to 15 Rs.
 Britania Nutri choice biscuit price changed frm

14 to 15 Rs.
INTRODUCTION OF LOWER UNITS
 Henkel withdrew 500 gm pack priced at 46 rs

and introduced 400gm pack at 40 rs
 Amul introduced 25gm butter packets , which

have registered more sales than its 100 and
500gm packs.
COST CUTTING STRATEGIES
 Companies have cut down their expenditure

on advertisements
 Soap companies have shifted to cheaper

options of raw materials.
MERGERS AND ACQUISITIONS
 In 2005 Dabur India announced the acquisition

of Balsara Hygeine and Home Care businesses
RESTRUCTURE TO LEVERAGE SYNERGIES
With the “Power for one” strategy Pepsi co is aligning

its snack and beverage business under a common
leadership
OTHER PRICING STRATEGIES
HINDUSTAN UNILEVER LIMITED (HUL)
MARKETING STRATEGIES OF HUL
MARKETING STRATEGIES FOR URBAN INDIA
 Adopted Total Productive

Maintenance(TPM)
to meet zero error, zero loss,
zero accidents.
 Focuses on short supply chain
for distribution.
 To meet the every needs of
people everywhere.
 Also uses Direct selling
channel, franchisee to
reach everyone e.g.
Aviance, Ayush.
 Build segments & market

for the future where
Unilever has strong
expertise.
MARKETING STRATEGIES FOR RURAL INDIA
For long term benefits, HUL started Project Streamline
in 1997. Appointed 6000 Sub-stockists that directly
covers about 50,000 villages & 250 million
customers.
Integrate Economic, Environment & Social

o Objectives with Business agenda.
Project Shakti, partnership with Self help

groups of Rural women & covers 5000 villages
in 52 districts in different states
MARKET OVERVIEW
The Indian FMCG sector is the fourth largest sector in the

economy with a total market size of US$18 billion
as of 2007.
By 2015, the sector is predicted to scale up to US$33.4 billion.
The sector generates 5% of total factory employment in the

country and is creating employment for 3 million
people especially in small towns and rural India.
INDIAN FMCG MARKET SIZE(IN USD BILLION)
THANK YOU

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FMCG

FAST MOVING CONSUMER

The Fast Moving Consumer Goods

 They are used at least once a month

Savings Others Clothings

Entertainment Personal Care Grocery

 Price of raw materials are decreasing

 Cost of machinery required for consumer goods

- mint newspaper 23rd dec 2010

2. Large Consumer Goods Spender

4. Retailing – New growth area

5. Demand & Supply Gap

 Surf Excel price hike from 13 to 15 Rs.

 Britania Nutri choice biscuit price changed frm

 Henkel withdrew 500 gm pack priced at 46 rs

 Amul introduced 25gm butter packets , which

 Companies have cut down their expenditure

 Soap companies have shifted to cheaper

 In 2005 Dabur India announced the acquisition

With the “Power for one” strategy Pepsi co is aligning

 Adopted Total Productive

 Build segments & market

Integrate Economic, Environment & Social

Project Shakti, partnership with Self help

The Indian FMCG sector is the fourth largest sector in the

By 2015, the sector is predicted to scale up to US$33.4 billion.

The sector generates 5% of total factory employment in the

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