FMCG SECTOR

FMCG SECTORSUBMITTED BY:HIMANSHU SHARMAAMITY BUSINESS SCHOOL INTRODUCTIONThe Indian FMCG sector is the fourth largest sector in the economy.

Intense competition between the organized and unorganized segments.

Availability of key raw materials, cheaper labor costs and presence across the entire value chain gives India a competitive advantage.

Even during the slowdown of the economy, the FMCG sector has registered a growth rate of 14.5 per cent for the year 2007-08.

FMCG Market is in excess of Rs. 85,000 Crores.

It includes household care, personal care , food & beverages.

The key players in FMCG sector are HUL,ITC, Dabur India Limited, Procter & Gamble Hygiene & Health Care Limited, Nirma Limited, Emami Limited, Colgate Palmolive India Limited, Godrej Consumer Products Limited.MAJOR SEGMENTS IN FMCGHousehold Care

Personal Care

Food & BeverageFABRIC AND HOUSEHOLD ORALCARE,SKIN CAREHEALTH BEVERAGES,COFFEE,SOFT DRINKFMCG SECTOR OF INDIAThe Indian FMCG sector, with a market size of $ 25 billion constitutes 2.15 per cent of Indias GDP.

The industry is poised to grow at CAGR between 10 to 12 per cent annually.

Annual profit of FMCG sector is $14.74 billion.

Market growth rate Rural -40%, Urban -25%

Average Indian spending on groceries and personal care is 48% (Groceries 40% & personal care 8%).

Market growth rate Rural -40%, Urban -25%

Average Indian spending on groceries and personal care is 48% (Groceries 40% & personal care 8%).

FMCG VS INDUSTRIAL MKTNG

GROWTH FACTORS FOR FMCGTOP 3 COMPANIES IN FMCG

The Company has 21 product categories out of which only 8 product have presence in IndiaIn India Proctor & Gamble has two subsidiaries: P&G Hygiene and Health Care Ltd. and P&G Home Products Ltd.P&G Hygiene and Health Care Limited has a turnover of more than Rs. 500 crores

No 1 company in IndiaSales turnover of Rs 3,700.8 croresProduces 35 different brands with 15,000 employees

ITC is one of India's foremost private sector companies with a market capitalization of over US $ 30 bln and a turnover of US $ 6 billionITC is rated among the World's Best Big CompaniesITC ranks among India's 10 Most Valuable (company)Brands While ITC is an outstanding market leader in cigarettes, Hotels, Paperboards, Packaging and Agri-Export

PORTERS FIVE FORCE MODELRivalry among Competing FirmsIn the FMCG Industry, rivalry among competitors is very fierce.There are scarce customers because the industry is highly saturated and the competitors try to snatch their share of market.

Potential Entry of New Competitors:FMCG Industry does not have any measures which can control the entry of new firms.The resistance is very low and the structure of the industry is so complex that new firms can easily enter and also offer tough competition due to cost effectiveness. Hence potential entry of new firms is highly viable.Potential Development of Substitute Products:There are complex and never ending consumer needs and no firm can satisfy all sorts of needs alone. There are plenty of substitute goods available in the market that can be re-placed if consumers are not satisfied with one.

Bargaining Power of SuppliersThe bargaining power of suppliers of raw materials and intermediate goods is not very high.There is ample number of substitute suppliers available and the raw materials are also readily available and most of the raw materials are homogeneous.There is no monopoly situation in the supplier side because the suppliers are also competing among themselves.Bargaining Power of ConsumersBargaining power of consumers is also very high. This is because in FMCG industry the switching costs of most of the goods is very low and there is no threat of buying one product over other.Customers are never reluctant to buy or try new things off the shelf.CAREER OPTIONS IN FMCGMarketing there are different categories of sales and marketing officers; the positions largely depend on the academic qualifications and the experience of the applicants. The general job profile requires sales and marketing officers to assess and manage the volume and profit of the industrys business. The sales plans and the market shares are also managed by the sales and marketing positions in FMCG.

Human Resources - the overall HR process is developed and managed by this department. The HR process comprises coordinating, administering and retention of the organizations workforce.

Finance - the financial records and transactions of an FMCG organization is managed by the finance department. The department oversees the accounting methods and records.

Purchasing - optimization of costs while also maintaining the standard of the work generated is the responsibility of the purchasing department.

Supply Chain - ensures that all products of the FMCG industry are manufactured and delivered in the scheduled time.

General Management - the operation laws and directions are made and approved by this department in FMCG.

Product Development - the policies, research & development programs and business strategies of the organization are formulated by this department of FMCG.

Operations - the logistics and manufacturing departments are organized and managed by the operations department.

DISTRIBUTION IN FMCG

BEST CAMPAIGNS COMPANY: Mondelez

PRODUCTS: Oreo cookies

DIGITAL PLATFORMS USED: Facebook and Twitter

CAMPAIGN: Confectionery giant Mondelez rolled out a digital campaign for a new variant of its bestselling Oreo cookies. The campaign, on social networking site Face book and micro blogging site Twitter, aimed at communicating how the Oreo Cookie and the new variant, Orange blend beautifully together. The campaign reinforced this connection between them and narrated tales of them as #OreoBesties, while engaging Oreo's fan base with multiple activities.

IMPACT: The campaign reached more than 600,000 people on Face book and generated close to 300,000 impressions on Twitter. (Impressions are the number of times a post or tweet is displayed).

TV COMMERCIALS:1.Vodafone https://www.youtube.com/watch?v=g-9GJ8Sgq6Q

2. Nescafe https://www.youtube.com/watch?v=u1whG-9BjsQ

Vodafone Product or service being sold : Vodafone Network

General mood or feeling of the commercial : Funny and interesting

Role of soundtrack in commercial : Limited soundtrack

Actors playing the characters in the commercial : A guy passed in exams where mostly others failed and there comes the Vodafone proving to be the best when you want to communicate to the whole world.

Nescafe #ItAllStarts

Product or service being sold : Nescafe Classic

General mood or feeling of the commercial : Very emotional and Funny ( Both side by side)

Role of soundtrack in commercial : Smooth

Actors playing the characters in the commercial : A person named Rishi stammers but still is very motivated and is constantly helped by the Nescafe classic to perform as a stand-up comedian.

THANK YOU