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Digital transformation to be a key driver for growth, says Tata Consumer Products


Tata Consumer Products Limited (TCPL) sees ‘digital transformation as a key driver’ for growth of the company and it is strengthening capability in this area, according to the company’s annual report.

Digital transformation to be a key driver for growth, says Tata Consumer Products

According to a PTI report: The Tata Group firm expects a long term shift in consumer behaviour due to the coronavirus pandemic, while in short term an increase at-home consumption with a reduction in orders for take-out or deliveries is expected.

As part of its strategy, TCPL is innovating with new marketplace models and expects a larger play in the foods and beverages businesses, where TCPL is expanding its portfolio and sharpening capabilities for the longer term.

“We see digital transformation as a key driver for growth and we are strengthening our capability in this area, including a digital platform for commodity buying, enabling the entire supply chain from demand planning to procurement and embedding digital technology and decision-making at the frontline of the sales organisation,” said Suni D’Souza, Managing Director and CEO, TCPL was quoted by PTI as saying.

Recently, the company has tied up with several delivery providers and e-commerce partners to enable direct delivery to consumers.

“We are innovating with new marketplace models. We have tied up with delivery providers and e-commerce partners to enable direct delivery to consumers. We are also accelerating our digital agenda to take advantage of the new world realities,” he was further quoted by PTI as saying.

According to him, there have been significant changes in consumer beliefs, habits and buying patterns during the pandemic and the recent lockdowns.

TCPL, which owns popular brands like Tata Salt, Tata Tea, Tetley, Eight O’ clock and Himalayan Water, said it has marked a new strategic direction for the company with accelerated expansion into the Rs 6,00,000 crore Indian FMCG industry.

“We perceive a large and transformational market opportunity ahead of us and we aim to leverage our strengths to become a formidable player across the three segments of in-the-kitchen, on the-table and on-the-go, offering products that are high in quality, innovative, delightful and made with goodness and care,” the company said.

On the outlook, the company said there will be a stronger focus on quality and hygiene – resulting in consumer preference shifting from unbranded to branded options.

“Consumers will proactively look at health & wellness options in their purchases, including traditional and preventive measures. There will be higher growth and demand of staple products (such as Salt, Pulses, Tea and Coffee – also part of essential commodities) for in-home consumption, in comparison with discretionary items – which is in direct contradiction to the trend witnessed in the last few years,” said TCPL.

Besides, there would be a rise of consumers who are more price and value-conscious in their choices, given the uncertainty of the COVID-19 pandemic.

After merging the consumer products business of Tata Chemicals with Tata Global Beverages, the company was renamed TCPL.

Besides, the company, which had recently announced to acquire the stake of beverage major PepsiCo in their JV NourishCo Beverages, is strengthening its play in the fast-growing ready-to-drink beverages portfolio.

“We are focusing on strengthening our ready-to-drink beverages portfolio. We are in the process of acquiring PepsiCo’s stake in NourishCo Beverages Limited, a 50:50 JV between the two companies. We will look to scale up NourishCo’s capabilities and footprint further and build a differentiated portfolio in this segment,” he was quoted by PTI as saying.

While talking about their JV Tata Starbucks, TCPL said by the end of May 2020, it had 60 stores opened for takeaway and deliveries in 10 out of the 11 cities we are present in.

Tata Starbucks had added 39 new stores opened during the year, the report said.

“Our growth in Tata Starbucks was however impacted a bit in the fourth quarter, due to the onset of COVID-19, which led to the closure of all our stores for more than two weeks in the month of March. Some of our stores have now opened for delivery and takeaways and will progressively normalise over the next few months,” it added.

TCPL has also acquired the branded business of Dhunseri Tea Industries to strengthen its market presence in Rajasthan.