FMCG personal Care industry analysis
Submitted by: Group2
Section A
Table of Contents
1. EXECUTIVE SUMMARY
1.1. Beauty and personal care shows no signs of slowdown
This category continued to show consistent growth in terms of value in 2012
Main drivers of growth :
Acceptance of higher-priced products with new claims by urban consumers
New consumers in second and third-tier cities continued to show greater interest in self-grooming.
The leading companies introduced products in smaller pack-sizes and innovative pack formats to leverage consumer base in second-tier cities and stimulate their interest and desire to try out such products.
1.2. Beauty and personal care becomes more gender-specific
Main drivers of growth: Urban men becoming increasingly appearance-conscious, and looking for male-specific products.
Leading companies such as ITC and HUL introduced range of male-specific bath and shower products, apart from the already growing range of men’s skin care products which were available so as to capitalize on the growing opportunities in this category.
1.3. New launches and promotions intensify the competition
International manufacturers maintained their lead in 2012 even though this category remained fragmented.
New launches in shower gel, facial cleansers, anti-agers and moisturizers encouraged consumers to try out different brands.
Many manufacturers started to offer promotional offers such as conditioners free with shampoos, so as to push their products at points of sale.
1.4. Independent small grocers maintains its lead, whilst direct selling increases further
As the majority of consumers still reside in second and third-tier cities, independent small grocers remained the largest channel for sales in this category
The contribution of direct selling to the overall sales (value) recorded a significant rise Direct sellers like Avon continued to strengthen their presence in southern states and in second-tier cities like Meerut
Section A
Table of Contents
1. EXECUTIVE SUMMARY
1.1. Beauty and personal care shows no signs of slowdown
This category continued to show consistent growth in terms of value in 2012
Main drivers of growth :
Acceptance of higher-priced products with new claims by urban consumers
New consumers in second and third-tier cities continued to show greater interest in self-grooming.
The leading companies introduced products in smaller pack-sizes and innovative pack formats to leverage consumer base in second-tier cities and stimulate their interest and desire to try out such products.
1.2. Beauty and personal care becomes more gender-specific
Main drivers of growth: Urban men becoming increasingly appearance-conscious, and looking for male-specific products.
Leading companies such as ITC and HUL introduced range of male-specific bath and shower products, apart from the already growing range of men’s skin care products which were available so as to capitalize on the growing opportunities in this category.
1.3. New launches and promotions intensify the competition
International manufacturers maintained their lead in 2012 even though this category remained fragmented.
New launches in shower gel, facial cleansers, anti-agers and moisturizers encouraged consumers to try out different brands.
Many manufacturers started to offer promotional offers such as conditioners free with shampoos, so as to push their products at points of sale.
1.4. Independent small grocers maintains its lead, whilst direct selling increases further
As the majority of consumers still reside in second and third-tier cities, independent small grocers remained the largest channel for sales in this category
The contribution of direct selling to the overall sales (value) recorded a significant rise Direct sellers like Avon continued to strengthen their presence in southern states and in second-tier cities like Meerut
References: 1. Viveat Susan Pinto, “2010 was M&A year for FMCG”, Business Standard, December 2010; http://www.business-standard.com/article/companies/2010-was-m-a-year-for-fmcg-110122100115_1.html (as on Sep 11, 2013) 2 3. “Government allows up to 51% FDI in multi-brand retail, 100% in single brand”, The Economic Times, Jul 2013; http://articles.economictimes.indiatimes.com/2012-09-14/news/33844347_1_multi-brand-single-brand-fdi (as on Sep 11, 2013) 4 5. Krishna Pophale, “Bajaj Corp acquires NOMARKS brand”, Business Standard, August 2013; http://www.business-standard.com/article/companies/bajaj-corp-acquires-nomarks-brand-113082200385_1.html (as on Sep 11, 2013) 6 7. Pranali Shah, “Update: Sequoia Acquires Minority Stake In Vini Cosmetics”, Business Standard, August 2013; http://www.dealcurry.com/20130816-Update-Sequoia-Acquires-Minority-Stake-In-Vini-Cosmetics.htm (as on Sep 11, 2013) 8 11. Dave Jordan, “FMCG Mergers & Acquisitions (M&A):Why acquired brands fail to deliver”, Enchange, August 2010; http://supplychain.enchange.com/bid/63395/FMCG-Mergers-Acquisitions-M-A-Why-acquired-brands-fail-to-deliver (as on Sep 11, 2013)