Adoption and Growth of FMCG

The Fast Moving Consumer Goods (FMCG) industry began in the late 19th and early 20th centuries with the introduction of mass production and mass marketing techniques, mainly in the UK and the US. During this period, some of the well-known brands around the world like Procter & Gamble (P&G), Unilever, Colgate Palmolive, Nestlé, Johnson & Johnson began their journey. With the advent of new technologies and changing consumer preferences, it has continued to evolve and grow globally over the decades.

FMCG in India began a little late as Investment in the FMCG industry was minimal or non-existent between 1950 and 1980. Locals opted for necessities over luxury goods because they had less spending power. Local merchants and traders were favoured by the Indian government. Between 1980 and 1990, consumers started demanding a wider range of items, which led businesses to make more of their products available. Globalisation caused a major shift in tide for the FMCG industry in India and new businesses entered the market as the FMCG sector began to grow. At the same time, India's advertising sector expanded, increasing the motivation for new firms to be successful.

Initially, advertising for FMCG products was focused on mass media, such as television and print, to reach as many people as possible. The messages were straightforward, highlighting the benefits and features of the product, with the goal of driving sales through mass distribution. One classic example of early FMCG advertising is Coca-Cola's "Drink Coca-Cola" campaign, which was first launched in 1886. The advertisements used simple illustrations and taglines to promote the refreshing taste of Coca-Cola and encouraged consumers to drink it whenever they felt thirsty.

As FMCG entered a little late in India around 1980s, the most popular form of FMCG advertisements in India was Television with famous video Ads like Dairy Milk during Cricket Worldcup and Nirma, a detergent brand’s Ad with the famous "Washing Powder Nirma" jingle, which was a huge hit.

Here are some nostalgic iconic Ads:

With the rise of digital technologies, advertising has shifted to include a wider range of channels, such as online video, social media, and mobile. This has allowed FMCG companies to target specific audience segments, personalise their messages, and track the effectiveness of their advertising campaigns in real-time.

Today fast-moving consumer goods (FMCG) products are widely available to people through various distribution channels, including Modern Retail, Ecommerce, Convenience/Kirana Stores and Direct to Consumer Brands. Increase in digitalisation in India has led to a major shift in the FMCG sector over the last 5 - 10 years. With these new digital channels and D2C booming, well established brands like Himalaya, Unilever, ITC are competing with the D2C startups like Mamaearth, Wakefit, Plum. Ecommerce and Internet has led to an increase in the market penetration of FMCG in the rural areas.

The Indian FMCG market is expected to grow at a 14.9% CAGR to USD 220 billion by 2025, up from USD 110 billion in 2020. The Indian FMCG industry grew by 16% in CY21, a 9 year high, despite nationwide lockdowns, supported by consumption-led growth and value expansion from higher product prices, particularly for staples.

*Source by: IBEF report*

Consumer spending in India is expected to reach USD 8.85 trillion by 2025. Aside from these factors, businesses can anticipate an increase in consumer goods due to global population growth. Individual income growth, easy access to goods via e-commerce platforms, the introduction of new products, and effective advertising have all contributed to the exponential growth of this industrial sector.

This sector is largely considered as recession-proof as they deal with essential commodities and has created a large number of job opportunities in India, making it a key pillar of the Indian economy. FMCG sector is poised for growth with increasing consumer income, changing lifestyles, rural consumers and economic growth

The FMCG sector is projected to see strong employment growth in the coming years. It has been one of the most sought-after careers for jobseekers and hence, it is among the most competitive industries in India. The FMCG sector tops the talent demand chart with a year-on-year increase of 10% in the past 6 months, 17% in the past year, and 36% in the past two years. There is a significant demand for talent in the IT function as the sector progresses along the path of digitization.

The Fast Moving Consumer Goods (FMCG) sector in India is a major employer, providing employment opportunities across various levels, including sales, marketing, production, and distribution. The sector has seen steady growth in employment, with a large portion of the workforce being engaged in rural areas. The FMCG sector is expected to continue to provide employment opportunities and drive economic growth in the coming years. Additionally, the increased focus on rural marketing and distribution is expected to further boost employment opportunities in rural areas.

• An?MBA degree?is mandatory for?57%?of the job postings. A degree from a prestigious institute is mentioned in?30%?of job postings.
• Mumbai?continues to be the most popular destination for FMCG talent, accounting for?28%?of all job postings in this region.
• Only?3%?of the available positions were?remote or hybrid, while?94%?of the vacancies were for on-site positions.

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