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Forecast 2020: Trends & Expectations from the FMCG Industry


The industry in India has seen a remarkable transformation over the last two decades, facilitated by rising income levels, urbanisation and changing consumer behavior. The general industry sentiment is positive and optimistic post demonetization and GST implementation with large players set to gain. Rural consumption has superseded industry expectations with the size of modern retail estimated to grow three times in the next five years. A significant change in lifestyle choices, as well as a substantial increase in disposable income, has fuelled this growth. Nonetheless, the changing market dynamics bring with it an array of products that compete for customer loyalty and attention. Here is a look at the trends for the market in 2020:

Forecast 2020: Trends & Expectations from the FMCG Industry
A significant change in lifestyle choices, as well as a substantial increase in disposable income, has fuelled the growth of the FMCG industry in India

Digitisation: Increasing smartphone and internet penetration will help people in rural areas easily access online shopping on various e-commerce websites. The availability of easy mobile payment options has lead to an increase in the number of orders from Tier II & III cities, which enables people to get timely delivery at their doorstep.

Multiple Channels of Trade: Multiple channels of trade will help users make purchases through platforms on which they spend a lot of time like Facebook, Youtube, and Instagram. This has led to a more interactive overall shopping experience as users get the best of both entertainment and shopping. Other than these traditional portals like , , as well as supermarket apps like and , are also popular.

D2C Model: D2C is a popular business model that allows buyers to get goods directly from the seller/ manufacturers without the help of any middlemen. Several e-commerce websites are set for this purpose, which helps buyers save money as well as time.

Brand Community: Users these days can interact with other people who have bought the same product and talk at length about it. A lot of brands are devising marketing strategies to build a brand community where they are target people who are interested in their products as well as have similar social, political and cultural factors. This makes interaction a bit more personal than it is with customer care representatives.

Foreign Brands: Big foreign brands have left no stone unturned to enter the Indian market as they have seen the huge demand for their products. This has forced local as well as domestic manufacturers to up their game and provide cheaper alternatives while not compromising on quality to offer the same sense of pride that owning a foreign product provides.

Consumer Behavior: Consumer Behavior is something that cannot be cast in a permanent pattern as it keeps changing. However, there are a few patterns that have been present for a long time bringing to our attention the ways consumers usually spend their money. After analyzing past consumer data as well as the latest one we came across these trends of consumer behavior which will be prevalent throughout 2020. One of them is consumers buying family packs and combo offers as it saves them an extra trip to the grocery store. Other common instances of consumer behavior are high demand for ready to eat snacks, wellness products that are mostly organic, and premium quality products. In order to keep up with these trends, every FMCG company must be proactive in taking these steps, which ensure brand building and longevity in the market.

Build Strategy Around Consumer Preference: It is very important to devise a brand strategy around consumer preference as the consumers today are very informed and patient when it comes to product decision making. Users these days check the ingredients of the product they are purchasing as well as its carbon footprint and health benefits.

Attractive Merchandising: Attractive merchandising is paramount when it comes to the sale and purchase of products. In this highly visual world, consumers only go for what they like upon seeing. Once your product has caught their eye they will certainly try it and if they like it they will go for it again so make sure the packaging on display is impeccable.

Optimise Marketing Efforts: An adequate digital strategy is needed to target customers who have performed a search for products that your brand offers. With so much data available it is imperative to hire a team for analyzing the current market demand for your products and then generate authentic leads to convert them into sales.

Market Intelligence & Consumer Insights: Any brand or company cannot stay in the market for long if it has not done a thorough research of the same. A company that is aware of the prevalent pattern will mostly make decisions in its benefits than otherwise. This will save them a lot of money as they will be able to get the right number of products out in the market for direct consumption especially if the shelf life of their products is not long. Organizing consumer insights into data points help companies predict the future consumer pattern and soar above their competitors.