Google News
spot_img

From Gut Feeling to Big Data: How FMCG Brands Are Reading Your Mind (and Wallet)

Must Read
Pawan Jagnik
Pawan Jagnik
Pawan Jagnik is head of marketing - India at Pladis Global handling McVitie's, Godiva and Ülker brands. He holds a Master of Business Administration (MBA) degree from the prestigious Indian Institute of Management Kozhikode, complemented by a Bachelor of Engineering (B.E.) from D. Y. Patil College of Engineering, Pune University.

Today, insights gleaned from market research and consumer behaviour are empowering Indian FMCG brands to comprehend their customers better and craft targeted strategies

In the ever-evolving landscape of the Fast-Moving Consumer Goods (FMCG) sector in India, the transition from gut feeling to big data analytics marks a pivotal shift in how companies understand and respond to consumer behaviour. Traditionally, decision-making in FMCG relied heavily on intuitive insights drawn from years of industry experience and market observation. While effective in its own right, this approach often lacked the precision and scalability needed to keep pace with rapidly changing consumer preferences and competitive dynamics.

According to NeilsenIQ, the Indian FMCG sector grew by 6.5% during January-March 2024, with rural consumption surpassing urban for the first time in five quarters. This shift underscores the necessity for FMCG brands to adapt swiftly, especially in rural India, where big data can play a pivotal role.

Embracing Data-Driven Insights

The advent of big data has brought about a paradigmatic change in how Indian FMCG companies approach consumer insights. By harnessing data from diverse sources such as retail transactions, social media interactions, online reviews, and demographic trends, companies gain deeper visibility into consumer behaviour patterns. This wealth of information enables them to uncover nuanced insights and trends that drive strategic decision-making across product development, marketing campaigns, and distribution strategies.

Market Research and Deep Consumer Insights

Market research, empowered by big data analytics, allows FMCG firms to delve into consumer preferences with unprecedented granularity. Through advanced analytics, companies can segment markets based on socio-economic factors, geographic locations, and psychographic profiles. This deeper understanding helps in tailoring products and marketing strategies to resonate with diverse consumer segments. For instance, analysing social media sentiment allows companies to gauge consumer perceptions and adjust brand messaging in real-time. Moreover, predictive analytics empowers FMCG firms to forecast demand fluctuations accurately, optimise inventory management, and mitigate supply chain risks.

When planning the launch of the McVitie’s Tasties range in the Indian market, our thorough market understanding supported by data enabled us to pinpoint the fastest-growing flavours in various regions of India. For example, coconut emerged as one of the fastest growing flavours in the cookies category and majority of its sales came from North India. Recognizing the opportunity for a high-quality coconut biscuit without compromising on affordability, we developed our new flavour accordingly.

We also learned about the rising demand for indulgent products from abroad among top-end consumers in India. Acting promptly on this insight, we introduced a range of global offerings from McVitie’s product portfolio. These products, including McVitie’s Chocolate Coated Digestives, Thins, and Nibbles, were made available in the Indian market, particularly in major metro cities, catering to the tastes and preferences of premium consumers. 

Today, insights gleaned from market research and consumer behaviour are empowering Indian FMCG brands to comprehend their customers better and craft targeted strategies.

The Rise of AI and IoT in Consumer Insights

Looking ahead, the integration of artificial intelligence (AI) and Internet of Things (IoT) technologies promises to further revolutionise consumer insights in the Indian FMCG sector. AI-powered algorithms can analyse vast datasets with speed and accuracy, identifying emerging trends and predicting consumer behaviour with unprecedented precision. IoT devices provide continuous streams of real-time data, offering insights into consumption patterns, product usage, and customer satisfaction levels.

This data ecosystem not only enhances operational efficiency but also enables proactive decision-making. FMCG companies can personalise marketing strategies based on individual consumer preferences, deliver targeted promotions through digital platforms, and optimise product assortments to cater to evolving consumer tastes.

Democratising Sales through Lower Opening Price Points

In addition to sophisticated analytics, Indian FMCG brands are strategically lowering the opening price points of their products to democratise sales and expand market reach. By offering products at more affordable price ranges, companies aim to capture a broader consumer base, particularly in price-sensitive segments. This approach not only enhances accessibility but also fosters brand loyalty among budget-conscious consumers.

This approach also serves as a strategy to counter competition from regional players who often offer lower initial price points. For example, we initially set an opening price point (OPP) of Rs 65-Rs70 for McVitie’s Hobnobs range but found greater success with an OPP of Rs 25-30. We have continued this strategy with our newly launched McVitie’s Tasties range, setting an OPP of Rs 10.

Challenges and Considerations

However, the journey towards data-driven decision-making in the Indian FMCG sector is not without its challenges. Privacy concerns, data security regulations, and the need for robust infrastructure pose significant hurdles for companies navigating the digital landscape. Moreover, interpreting complex data sets requires skilled data analysts and cross-functional collaboration to derive actionable insights that align with strategic objectives.

Furthermore, while big data analytics provide empirical evidence and quantitative metrics, human intuition remains indispensable in interpreting qualitative aspects of consumer behaviour. Understanding cultural nuances, local preferences, and societal trends requires a nuanced approach that blends data-driven insights with industry expertise and market experience.

The Future Outlook

As the Indian FMCG sector continues to evolve, the synergy between human intuition and technological innovation will define the future of consumer insights. Companies that successfully integrate big data analytics into their decision-making processes will gain a competitive edge by anticipating market trends, optimising resource allocation, and enhancing operational agility. By embracing a holistic approach to consumer insights, FMCG brands can foster innovation, drive customer-centric strategies, and sustain long-term growth in a dynamic and diverse market environment.

In conclusion, the shift from gut feeling to big data analytics signifies a transformative journey for Indian FMCG companies seeking to navigate the complexities of consumer preferences and market dynamics. By harnessing the power of data-driven insights, companies can unlock new growth opportunities, strengthen brand relevance, and foster deeper connections with consumers across diverse demographic segments. As technology continues to advance, the ability of FMCG brands to leverage data effectively will be crucial in shaping their success and resilience in an increasingly digital and competitive marketplace.

By embracing data-driven decision-making while honouring the nuances of Indian consumer behaviour, FMCG companies can position themselves as leaders in innovation and responsiveness, ultimately driving sustainable business growth in the years to come.

Latest News

D2C brand Beyoung to go international with the first store in Dubai

The brand is focusing on increasing its presence in the Middle East and achieving a GMV of Rs 650...