We often hear these lines buzzing on our media, “Celebrate Life”, “Small Actions, Big Difference”, “100 Inspiring years”, etc. The colorful racks you see in D-Mart, JioMart or even your local grocery stores with tons of options to choose from, yet the tag line and the advertisement you just saw this morning rings back in your mind and you are keen to search the same product among the host of other options. That is the of power of brand recall. Nonetheless, “Jo dikhta hai, woh bikta hai”, cannot be ignored.
Starting an FMCG business is not just a play of quality product, but also Branding and shelf presence. Hence in this competitive era which is buzzing with competition, strong product development and branding cannot be ignored.
If an entrepreneur is looking to lay the foundations of an FMCG startup company, he is very likely to understand the nuances of doing the same if he understands how this industry evolved and how is the future looking for, for the same. Here I have out down the same
The history of FMCG (Fast-Moving Consumer Goods) dates back centuries, but the modern concept of FMCG as a distinct sector within the consumer goods industry emerged in the 20th century. Here’s a brief overview of the history of FMCG:
The trade of goods essential for daily life, such as food, beverages, toiletries, and household products, has been a part of human civilization since ancient times. Early civilizations engaged in barter trade, exchanging goods they produced locally or acquired through trade routes.
The Industrial Revolution of the 18th and 19th centuries brought significant advancements in manufacturing processes, transportation, and distribution. This period saw the mass production of consumer goods, making them more accessible and affordable to a wider population.
With increased production capabilities, companies began to focus on branding and marketing their products to differentiate themselves from competitors. The late 19th and early 20th centuries saw the rise of iconic brands such as Coca-Cola, Procter & Gamble, Unilever, and Nestlé, which laid the foundation for the modern FMCG industry.
In the latter half of the 20th century, globalization accelerated, enabling FMCG companies to expand their operations internationally.
The advent of technology, particularly the internet and e-commerce, has transformed the FMCG sector in recent decades.
In response to growing consumer awareness and concerns about environmental sustainability and social responsibility, FMCG companies have increasingly focused on sustainability initiatives, ethical sourcing, and corporate social responsibility programs to align with changing consumer preferences and regulatory requirements.
Technology has for long been playing a key role in delivering a competitive edge for FMCG companies. Many companies are already reaping the benefits of digital transformation initiatives, some nascent and others comprehensive. In that light, it’s interesting to see how Artificial Intelligence is unlocking huge benefits for FMCG companies by bringing in more efficiency as well as effectiveness in several business functions.
AI can help FMCG companies get predictive insights into customer behaviour, deliver a better consumer experience, and facilitate superior engagement. AI also enables a great deal of automation in business processes that can help reduce costs and save time.
FMCG companies stand to benefit greatly by embracing the advancements in data-driven technologies like AI, ML, and deep learning. By adopting such cutting-edge technology in the fast-moving consumer goods industry, companies can make the supply chain more efficient, have better inventory management, and achieve more accurate demand forecasting.
To offer a better customer experience and gain a competitive edge, FMCG companies seek omnichannel sales and e-commerce in addition to deploying big data, analytics, and Artificial Intelligence (AI) solutions. The Internet of Things (IoT) devices and 3D Printing technology further enable FMCG companies to enhance direct distribution to meet the growing customer expectations.
Indian Consumers now subscribe, not buy!!!
Premium Service Model offers great consumer services. It provides a premium fee that is linked for the customers to sign up. It possesses substantial benefits and encourages the customers to sign up.
You can subscribe to razor blades, groceries, coffee beans, pet food and even underwear! Or you can join a premium community, ranging from parenting, entrepreneurship and even education, for advice, guidance and connections from like-minded people and veterans.
Through the increase in business insights, the retailers gain the incremental revenue that targets the customers more consistently and brings functioning modifications to them. Premium Service Model promotes customers loyalty, enhances sales, and has the average basket size.
Few points that lead to the success of such models:
Constant evolving of the product will give long term revenues
It’s tough for an organization to stand out in a crowd, but brand differentiation can be especially challenging for fast-moving consumer goods (FMCG). How does such a brand differentiate itself if consumers feel there’s little variation between what it and competitors offer?
But at its heart, brand differentiation is matter of understanding and listening to your audience’s needs, then tailoring your messaging to meet them.
Here are three simple strategies FMCG brands have used to successfully distinguished themselves.
Hero content is the centerpiece which you use to cast a wide net and attract a high volume of visitors—think TVCs, for example. Hub and hygiene content, though, are increasingly important as brands face a need for always-on content across digital channels to qualify new leads or maintain relevance in audiences’ minds. To ensure hub and hygiene content are relevant to your consumers, begin by researching the types of information they’re seeking and is most important to them.
Collaborating with influencers is another great way for brands to differentiate themselves, particularly by supporting a specific community—or even a handful of communities (opens in a new tab) for targeted, yet broadened, appeal.
It’s important to realize that aiming to become more inclusive and diverse shouldn’t be treated as a one-time ploy to get in customers’ good graces. Rather, it should be an opportunity for your brand to make a make a true cultural commitment (opens in a new tab) to better represent your audience.
Return on Advantage Model also referred to as the Competitive Advantage Model focuses on driving the business insights for the growth of new products by combining the internal transactional data with the third party data. This also targets the experiences between the online and offline platforms and for better customer segmentation.
This business model targets customer segmentation to enhance its capabilities. Through this, the purchasing patterns are identified and assembled to gain a better possibility of targeting the customers.
In summary, while starting an FMCG business requires diligence, perseverance, and strategic decision-making, the potential for success is substantial for those who are willing to innovate, adapt to changing market dynamics, and prioritize consumer satisfaction. By focusing on delivering quality products, building brand trust, and staying abreast of industry trends, applying AI, entrepreneurs can position their FMCG business for sustainable growth and profitability in the dynamic consumer goods market.
