FMCG

SECTOR

Detergen

t

Buiscui

tDeo’s

Tea

Cold Cream

Toothpaste

Soap

Coffee

Facewa

shSoft D

rinks

Shampoo

Chocklate Oil Pickles

Flour

Pain Relief

Air freshner

Talc

Snacks

NOTE :

This presentation is prepared on marketing point of

view

and are subject to India only.

All data are updated & Some of the pictures used in

presentation are edited as per requirements

Info Source:CIIGoogle imagesFMCG Co. WebsitesWikipediaPDF Document

Digital News: Business Maps of india.comNexusnovus.comIndia everyday.comMoney control.comManufacturing todayBusiness StandardTrading economics.com

CII is a non-government, not-for-profit, industry-led and industry-managed organization, playing a proactive role in India's development process.

Founded in 1895, India's premier business association has over 7100 members, from the private as well as public sectors, including SSI,MSI and MNCs and an indirect membership of over 90,000 enterprises from around 257 national and regional sectoral industry bodies.

2014 …What’s Happening???

Indian FMCG Sector are in for salary hikes of over

10% this year(2014)

PepsiCo's largest beverage plant in India is coming up

in Andhra Pradesh at a cost of Rs. 1,230 crore, its

single largest investment in India

direct and indirect employment for 8,000 people

It will invest Rs. 33,000 crore ($5.5 billion) in India by

2020

Deepika Padukone becomes Brand amassador of Coco Cola for Rs 6 Cr. Deal

(5th March 2014)

Emami signs Sonakshi Sinha as brand ambassador for Boro Plus (March 20th )

Tang introduces bottle pack for summer

Mortein launches awareness drive “U & ME AGAINST DENGUE”

Widely-popular fast-food chain McDonald announced its decision to launch its international coffee format McCafe in India

Jubilant Food Works to invest Rs 250cr in 2014.

Cadbury has developed a new heat-tolerant chocolate which is capable of withstanding temperatures of up to 40 degree Celsius

Parle Agro’s Café Cuba carbonated coffee to Target Youth

Glaxo Smithkline pays 1 billion USD to increase its stake in Indian Subsidiary (March 10th 2014)

FMCG ?? Fast Moving Consumer Goods (FMCG) goods, popularly named as

consumer packaged goods.

Goods are purchased by the consumers repeatedly on daily, weekly &

on monthly basis.

The price of such products per unit is low.

The consumption of such products is very high , Hence sold at large

quantities.

FMCG Brands like HUL, ITC, Marico, Dabur etc..

FOOD & BEVERAGESHealth beverages, cereals, bakery products, snacks, chocolates, ice cream, tea/coffee/soft drinks, processed fruits and vegetables, dairy products, ,branded flour .etc…

PERSONAL CAREOral care, hair & skin care, cosmetics/deodorants, perfumespaper products etc…

HOUSE HOLD CARE

Fabric wash, Household

cleaners

HEALTH CARE OTC products

FMCG

INDUSTRY AT A GLANCEFMCG sector is the fourth largest sector in the economy with a total market

size of US $13.1 billion Rs 79,000 Crores FMCG sector has grown at an average of 11% a year; in the last five years.

& in last 10 years the industries size has tripled.

Expected to reach 33.4 billon USD.

FMCG’s GDP contribution rises by 24%, & FMCG sector represents nearly 2.5% of countries GDP.

Cumulative FDI from April 2000 to 2013 April in Food Processing was

Rs 9,000 cr. & soaps,cosmetics-3,115.5cr.

Food products are the leading segment, accounting for 43% of the overall market, nearly 21 per cent of the country‘s GDP.

Food & personal care products make up two third of the sector’s revenue

Ready to drink TEA & COFFEE expected to grow rapidly in next 4 years.

Out of every 10,00,000 new jobs, 16% is created in FMCG.

Indian FMCG Market segment

2%

12%

43%8%

4%4%

5%

22%

Baby Care 2%

Fabric Care 12%

Food Products 43%

Hair Care 8%

Household 4%

OTC Products 4%

Others 5%

Personal Care 22%

Source : PDF Doc.

The urban FMCG market in India has been growing at a

fairly steady and healthy rate over the years.

The growth in rural markets has been more fast-paced.

Companies are now focusing on the rural market segment

which is contributing more than 35 per cent to the total

FMCG market

More than 80 per cent of FMCG products have posted faster

growth in rural markets as compared to urban ones in the

past.

Notable high growth items include snacks, refined edible oil,

healthcare products, Iodised salt etc..

Catching Up…

Penetration levelHairoils, Soaps, toothpastes, Jams and shampoos have

significantly high penetration in both urban and rural

markets

Instant noodles, floor cleaners and hair dyes are picking

up in the rural areas due to increased awareness

More than 200 million people expected to shift to

processed & packaged food

Highly exported items:

TEA & Coffee

Processed food, frozen ,dehydrated foods, Instant food, Ready to eat

food, Preserved vegetables & Sea food, Mangopulp, Poultry & meat

products, Confectioneries.

India also imports Foreign personal care products,

Packaged Food, Health Care Products.

Exports & Imports

MARKET SEGMENTATIONDEMOGRAPHIC

GEOGRAPHIC

SOCIAL AND ECONOMIC

BEHAVIOURAL

The products often catered to 3 very distinct aspects - necessity, comfort & luxury Available at:

Organized retail

Rural market

Our strategies??

Direct marketing

Using INDIA as a brand

Small size packet strategy

Pricing strategy

Aggressive campaigns & Promotional strategies

'Maine Desh Ka Namak Khaya Hai'

Distribution channel

Manufacturers /Marketers

State & territory distributors

Urban , Semi urban & Rural Stockists/Wholesalers

Organized and Unorganized market

Customers/Consumers

E-Commerce

(ITC’s Std. Distribution Channel)

Some Mergers , Acquisitions, J.V’s

P&G-Gillette merger

Rin & Surf excel bar Strategy

HUL made a unique marketing step in 2006. Rin Supreme became Surf Excel Bar..

FMCG Contribution to Indian EconomyEmployment Approximately 12-13 million retail stores in India, out

of which 9 million are FMCG kirana stores. So the sector is responsible for the livelihood of almost 13 million people

Fiscal contribution 30% revenue of the sector goes into both direct and

indirect taxes. estimated size of $25 billion (Rs. 1,52,500 crores)

Social contribution FMCG firms have also undertaken some specific projects( P&G, ITC ,TATA, Wipro etc..)

Agriculture - Its intake of agricultural output as raw material is estimated to US$ 2.2 billion(Rs. 13,640crores).

logistics market for the FMCG sector in India has been growing and is estimated to be US$ 146 million (Rs. 950 crores)

SWOT AnalysisStrengths-

Low operational costs.

Presence of established distribution networks in both urban and rural areas.

Presence of well-known brands in FMCG sector.

Favourable governmental Policy:

Indian Government has passed the policies aimed at lifting of the quantitative restrictions, reducing excise duties, 100 per cent export oriented units can be set up by government approval etc..

Foreign Direct Investment (FDI):

Automatic investment approval up to 100%foreign equity is allowed for most of the food processing sector, FDI in organized retail: India currently allows 100% FDI in Cash & Carry segment.

Weakness Low export levels

Counterfiet products The fake products are affecting the sales of leading brands by

almost 20-30 per cent i.e 15% of its revenue

Opportunities

Untapped rural market, changing life style.

Rising income levels, i.e. increase in purchasing power of consumers.

Large domestic market with more population of median age 25.

High consumer goods spending.

India is the largest milk producer in the world, yet only around 15 per cent of the milk is processed,hence has large long-term growth potential.

Only about 10-12 per cent of output is processed and consumed in packaged form, thus highlighting the huge potential.

Threats !!! Removal of import restrictions resulting in

replacing of domestic brands

Tax and regulatory structure

Rural demand is cyclical in nature and also depends upon monsoon.

To name a few…Amitabh BachanSRKAamir khan Hrithik RoshanSalman PuneethDhanushAishwarya RaiKareena KapoorKatrina KaifMadhuri Dixit

Sania MirzaSaina NehwalMary KomSachin tendulkarMS DhoniVirat Kohli

(Brand Ambassadors in FMCG)

A

(PESIT, Bangalore )

Presentation By :darsh Gaonkar

THANK