FMCG firms bet big on bumper festive sales


NEW DELHI : Fast moving consumer goods companies are ramping up supply chains and investing in marketing campaigns as they expect stronger sales this festival season.

Packaged food, beverages and cosmetics manufacturers said festive season initiatives, including expansion of the distribution network and trade and consumer-led brand promotions are gathering pace.

Hemant Malik, divisional chief executive, foods division, ITC Ltd, said the company is witnessing a strong uptick in demand with the onset of festivities, after two years of subdued festive demand due to pandemic-led restrictions.

“ITC’s agile supply chains and extensive distribution network are fully geared to ensure availability of a wide range of products across staples, snacks, noodles, frozen snacks across channels including e-commerce,” Malik said. ITC’s gift packs comprising B Natural juices and Sunfeast milk shakes saw encouraging demand during Rakshabandhan, and more than a dozen specialized offerings are being crafted across its foods portfolio, including Fabelle chocolates, Sunfeast cookies and B Natural beverages, for the upcoming festivals, he added.

“Supplies are an outcome of demand. We foresee huge demand in September-October and we have geared up our entire supply chain, particularly our factories. We are also expanding our infrastructure and distribution, which will tackle the spike in demand and lead to higher reach in the market,” said Madhur Pandey, vice president, marketing, at beverages company Parle Agro, the maker of Frooti and Appy.

Pandey said during Ganesh Chaturthi and Independence Day the company witnessed demand exceeding covid and pre-covid sales.

Chocolate and cookie maker Mondelez India, too, said consumers are likely to spend with “renewed fervour” this festive season. “Advertising and promotional investments like every year will be greater and in line with the expected return on investment, and while we are taking precautions due to the inflationary pressure, we, as a business, are well placed to strategically combat the situation,” said Anil Viswanathan, vice president, marketing, Mondelez India, which makes Oreo cookies and Dairy Milk chocolates.

“We will be leveraging our full portfolio across most of our stores since we expect the remaining of the gifting season to perform like never before. Like every year, we are introducing a segmented portfolio across channels and at different price points catering to a diverse consumer cohort. The amplification will be through different multimedia channels,” he said.

Pandey said the scale and volume of Parle Agro’s brand activation have increased. “We are sure we will be able to drive impact as well as sales for our brands,” he added. To be sure, FMCG volumes dipped 0.7% in the June quarter, according to researcher NielsenIQ. Companies facing high commodity prices have resorted to price hikes. Overall inflation and FMCG price hikes have impacted household consumption as well.

However, firms expect a strong festive season. Data from Bizom, a retail intelligence platform, suggests that FMCG sales grew 6.3% sequentially in August after three consecutive months of decline.

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Read More: FMCG firms bet big on bumper festive sales

2022-09-06 10:09:36

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