10 Things to Keep in Mind to Survive the Dynamic FMCG Market Right from machinery to the new media, the adaption is required on all the level of manufacturing, marketing and sales
Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
Fast moving consumer goods (FMCG) is the 4th largest sector in the Indian economy. According to the IBEF report in 2018, The FMCG sector has grown from US$ 31.6 billion in 2011 to US$ 52.75 billion in 2017-18. The sector is further expected to grow at a Compound Annual Growth Rate (CAGR) of 27.86 per cent to reach US$ 103.7 billion by 2020. The sector witnessed the growth of 11 per cent in value terms between April – June 2018.
International brands are diligently competing to acquire market share. Because it has such a wide consumer base, it attracts aggressive competition. To survive the aggression, one needs to keep a check on 10 things mentioned below.
Quality vs. The Price
Pricing plays a crucial role in customers mind when it comes to FMCG products. In general, a higher price is always associated with better quality. From a marketing point of view, pricing itself is so dynamic in nature that it can make or break a brand single-handed. If the expected quality is not met even after a premium pricing is charged, the brand loses credibility and most importantly 'repeat purchase' doesn't happen. So, maintaining superior quality can justify the pricing.
Good And Efficient Sales Force
Salesforce who work efficiently directly translates to the reduction of resources spent in-house which in turn means more profit margin. Honest employees are very crucial to business and customers alike. It creates a sense of trust for the brand when their workforce demonstrates honesty. The sales force that has a good image in consumers mind has a very high chance of creating loyalty for the brand
Distributors-Retailer relationship is one of the most fundamental aspects of a business. The job of the merchant is totally basic as they help in guaranteeing that the item is generally appropriated and accessible for the end shopper. The key advantage of these substances is in guaranteeing that the dissemination costs are brought down for the maker and at the same time the items are accessible for the end purchaser. For item engaged organizations, setting up the most proper dissemination procedures is a noteworthy key to progress, characterized as augmenting deals and benefits.
Timely Delivery (Logistics)
In the current E-Commerce, world customer is the king while timely delivery plays a significant role. Each business keeps running on the common trust of clients and specialist co-ops. In this way, organizations make different guarantees to their clients and they are made to be satisfied to exist in the market. In this focused world, quick and solid administrations bring more customers/purchasers than the nature of items. In this way, to be over the outlines, you must be one stage in front of the customer necessities.
The mass appeal creates a want for the product that sometimes turns into a need. Mass appeal creates demand and thus, volumes will be sold.
Innovation is the Key
With the rise of e-commerce, competition has risen beyond the sky, there's always a substitute available for one product. This makes the original product less interesting or even completely obsolete. A product must keep a customer engaged, via the introduction of new features. For eg., Food items can experiment with newer flavours or adding a line of extension to product categories. This keeps the product from going stale in the market and stands up to the competition.
Good Incentive Structure
Incentives/ Bonus are a really great way of boosting sales. It works like your internal marketing strategy to boost sales. Here the organization doesn't target customers but employees instead. A reward for achieving a target is a conditioning that goes way back in time. A small trip, Cash bonus, etc. are the best way to motivate employees to help the organization to reach their goals. Along with the materialistic benefits, appreciation of one's efforts also works wonders.
For FMCG brands packaging is the face of your product, it determines the traction your product will gain at first glance. It is a physical identity of the brand, which makes your brand recognizable from anywhere across the shelf. Most of the times it is a determining factor in point-of-purchase decisions. So, a decent attractive packaging is all you need to grab the attention. However, it should not be full of information or even very little information. Just the right amount for the consumer to skim through info and design.
Tap Newer Marketers
Increasing competition demands more market space. But not every product will work everywhere. Recognizing the potential market for your particular product can help you in a long run. Before tapping new market areas make sure you have fully covered the existing market space. Increasing household penetration is crucial.
Keep an Eye For Advance Technologies
Moving with times and adapting newer tech is one thing that will make your market survival easier. Right from machinery to the new media, the adaption is required on all the level of manufacturing, marketing and sales. It also benefits to connect with the newer generation of customers.