Group Members

Manoj

Gupta Rananjay Jaiswal Ravikiran A Sawant Sarang Mishra Sushant Gage

FAST MOVING CONSUMER GOODS (FMCG)

ABOUT FMCG
Starting from one cup of coffee in the morning right up to that relaxing malt beverage at night, we rely heavily on FMCG.

Everything from toothpaste to processed foods and health drinks to body care products comes from FMCG.

WHAT IS FMCG ?

FMCG industry, alternatively called as CPG (Consumer Packaged Goods). FMCG are those consumables which are normally consumed by the consumers at a regular interval. The regular day to day needs of goods that do not take much time for consumption are FMCG. Products with quick turnover & relatively low cost. Absolute profit made on FMCG products is relatively small but they sell in large quantity & earn large profits.

FMCG Category & Products

Household Care e.g. laundry soaps, mosquito repellents, dish cleaners etc.

Food & beverages e.g. soft drinks, tea, coffee etc.

Personal Care e.g. oral care, hair care, skin care, cosmetics, deodorants etc.

Market segments of FMCG Products

Market Segmentation

Geographic Zone wise, Villages and towns, Density & Climate. Demographic Age and Gender. Social and Economic Income group people, literate & illiterate people. Behavioral Occasions ( Diwali, Deshehra, Eid), Brand loyalty (rural area people are more brand loyal)

Target market
Differs from product to product examples: Mc Donald's Youth Vim bar Housewives Pepsodent Kids Kellogg's Previously kids now adults too Sugar free Age group of 35 and more

Marketing Strategy
Direct on-screen marketing (e.g. Harpic) Power brand strategy (Include those brand that have maximum pulling power and growth e.g. lifebuoy soap) Power brand extension (e.g. lifebuoy talcum powder) Small size packet strategy Pricing strategy Same value, size decrease (e.g. society tea)

Advertisement

Huge investment on advertisement Frequent broadcast Specially during peak hours During live matches During popular TV shows Target TV channels ( M TV, V TV) Through banners, posters, trial packs, events, hoardings, radio, Celebrities etc. Based on Market Research

Why advertisement?

As a reminder To inform about our product To show the success of brand To attract the customers To hamper the unsecured mind of consumer (e.g. saffola, dettol) To arise the need purposely To attach consumer emotionally with product To show facts and figures of products

Packaging

Attractive packs Vibrant colors Pack will show the important feature of product Protective packaging( bru coffee) Size wise packing (Navratna oil and Colgate) According to segmentation of Market Packaging should be enhanced time by time Affordable packs ( coca cola 200 ml).

Why INDIA?

Large Domestic Market Large Consumer Goods Spender Low Penetration & Low per Capita consumption Changing Lifestyles Retailing New growth area Demand & Supply Gap

Advantages to India

Emergence of organized retail business. Growing urbanization. Increasing disposable income. Changing Life Styles.

SECTOR OUTLOOK IN INDIA

FMCG is the fourth largest sector in Indian economy with a total market size of Rs.85,000 crores. FMCG sector in India is estimated to grow 60% by 2010. FMCG sector generates 5% of total factory employment in the country.

Analysis of FMCG Sector

Strengths: 1. Low cost of production. 2. Presence of established distribution in both urban and rural areas. 3. Innovative brand promotion strategies. 4. Presence of well known brands in FMCG sector.

Weaknesses: 1. Lower investment in technology and hence fail to enjoy economies of scale. 2. Inflationary pressures hit the production costs. 3. Imitated products in market hurt the brands.

Opportunities: 1. Untapped rural market. 2. Increasing disposable income of consumers. 3. Large and expanding domestic market. 4. Changing tastes and preferences of consumers.

Threats: 1. Removal of import restrictions resulting in replacing of domestic brands. 2. Slow down in rural demand. 3. Tax and regulatory structure.

Scope of the Sector

FMCG will be witnessing more than 50% of growth in its Rural and Semi-Urban Segments by 2012. The villages of India account for 12.2% of the world's population. So there is more growth opportunities in rural India. The FMCG market is set to double from USD 14.7 billion in 2008-09 to USD 30 billion in 2012. With the growth of FMCG sector there is ample of employment opportunities in India.

The Indian retail market size is estimated at US$ 350.2 billion and is projected to grow at 13 per cent per annum to reach US$ 590 billion by 201112. The current share of organized retail is estimated to be 4 to 5 per cent and is expected to increase by 14 to18 per cent by 2015.

Hindustan Unilever Limited (HUL)

HUL is India's largest fast-moving consumer goods company based in Mumbai. HUL was formed in 1933 as Lever Brothers India Limited and came into being in 1956 as Hindustan Lever Limited through a merger of Lever Brothers, Hindustan Vanaspati Mfg. Co. Ltd. and United Traders Ltd. It is owned by the British-Dutch company Unilever which controls 52% majority stake in HUL. Hindustan Unilever's distribution covers over 2 million retail outlets across India directly and its products are available in over 6.4 million outlets in the country. It has an employee strength of over 16,500 employees and contributes to indirect employment of over 65,000 peoples.

Products of HUL

SWOT ANALYSIS OF HUL

STRENGTHS

Deep roots in local culture & markets & great understanding of consumer needs. Excellent distribution network & good relationship with the wholesalers & retailers. Good reputation & goodwill in the market for its products. Project SHAKTI creating brand awareness in rural India Good advertisements so as to make the consumers aware of its products, uses & price & also have a lasting impression by catchy ads. R&D and Marketing strategy.

WEAKNESS Unable to make a big impact in rural India. Competition From its Own Brands (Lux, Liril, Lifebuoy) Me too products which illegally mimic the labels and brands of the established brands. Strong competitors & availability of substitute products. High price of some products.

OPPORTUNITIES Big untapped market available, especially the rural areas. Growth potential is high for the power brands. Due to good reputation it may experiment & introduce new innovative products in the market. Changing lifestyles & rising income levels, i.e. increasing per capita income of consumers.

THREATS Mimic of brands. Removal of import restrictions resulting in replacing of domestic brands. Tax and regulatory structure. Temporary slowdown in Economy can have an impact on FMCG industry. High competition from established brands. (Nirma, Colgate, P&G)

Thank You