Fast-moving consumer goods (FMCG) sector is India’s fourth-largest sector and has been expanding at a healthy rate over the years because of rising disposable income, a rising youth population, and rising brand awareness among consumers. With household and personal care accounting for 50% ofFMCG sales in India, the industry is an important contributor to India’s GDP. Growing awareness, easier access and changing lifestyles have been the key growth drivers for the sector. The urban segment (accounts for a revenue share of around 65%) is the largest contributor to the overall revenue generated by the FMCG sector in India. However, in the last few years, the FMCG market has grown at a faster pace in rural India compared to urban India. Semi-urban and rural segments are growing at a rapid pace and FMCG products account for 50% of the total rural spending

A typical Shelf life of a ATL campaign is 6 to 8 months……and with increasing costs of air cover and billboards, ATL activities only last for a quarter or so. The management and marketing teams have to tactically and prudently use the budgeted resources to get the best results. This is where the BTL activities play an critical and important role. While ATL helps the consumers to do a brand recall, the actual product look & feel before the purchase can be achieved only through BTL activities. This is the “Moment of Truth” for both the seller and buyers.BTL is therefore, becoming a resilient core area for the sellers and retailers. Catchment actions & initiatives are seen as an important part across all the areas of the sales process at the last mile. Specifically in the era of multi brand retail outlets and modern trade outlets like D’Mart, Big Bazaars,Reliance Smart, Metro C & C, ABRL, Spencers etc. Not to forget the upcoming crop of “super stores”, “society stores” and “community stores”. In the Post COVID period, with the increasing trend of online purchases, the BTL activities at the last mile play a pivotal role. It is estimated that online sales will enjoy up to 7% pie in the gross sales of the company until 2030 or so.

Fast-moving consumer goods (FMCG) sector is India’s fourth-largest sector and has been expanding at a healthy rate over the years because of rising disposable income, a rising youth population, and rising brand awareness among consumers. With household and personal care accounting for 50% ofFMCG sales in India, the industry is an important contributor to India’s GDP. Growing awareness, easier access and changing lifestyles have been the key growth drivers for the sector. The urban segment (accounts for a revenue share of around 65%) is the largest contributor to the overall revenue generated by the FMCG sector in India. However, in the last few years, the FMCG market has grown at a faster pace in rural India compared to urban India. Semi-urban and rural segments are growing at a rapid pace and FMCG products account for 50% of the total rural spending

A typical Shelf life of a ATL campaign is 6 to 8 months……and with increasing costs of air cover and billboards, ATL activities only last for a quarter or so. The management and marketing teams have to tactically and prudently use the budgeted resources to get the best results. This is where the BTL activities play an critical and important role. While ATL helps the consumers to do a brand recall, the actual product look & feel before the purchase can be achieved only through BTL activities. This is the “Moment of Truth” for both the seller and buyers.BTL is therefore, becoming a resilient core area for the sellers and retailers. Catchment actions & initiatives are seen as an important part across all the areas of the sales process at the last mile. Specifically in the era of multi brand retail outlets and modern trade outlets like D’Mart, Big Bazaars,Reliance Smart, Metro C & C, ABRL, Spencers etc. Not to forget the upcoming crop of “super stores”, “society stores” and “community stores”. In the Post COVID period, with the increasing trend of online purchases, the BTL activities at the last mile play a pivotal role. It is estimated that online sales will enjoy up to 7% pie in the gross sales of the company until 2030 or so.

The Indian FMCG sector is expected to grow at CAGR of 27.9% from 179.94 billon US$ to 1007.45 billion US$ in 2029. The market segmentation between organized and unorganized sector is 70:30 in Dec 2022. The BTL industry is expected to grow at 20% YOY every year and is expected to be at 300 billion US$ by 2029. Marketing spends dedicated to BTL activities is poised to grow at the same ratio over the next 7 to 8 years. The relationship between market activations and technology is evolving. Brands are deploying social media technologies, AI technologies, as well as personal digital devices (read mobile and/or ipads) to gauge consumer behaviors on a weekly basis if not daily basis.

The FMCG / retail market is segmented into Food & Beverages, Pharmaceuticals, Household & Personal Care, Consumer Electronics, and Others. Food & Beverages segment is expected to hold the largest market shares of 40% by 2029. The changing preferences of the upward middle class families from the urban areas gave importance to food & beverages sector and thus, fueled the growth in the last few years. India is the world’s second largest producer of food, next only to China, and has the potential of being the largest player in food and agricultural sector. The food processing industry is one of the largest industries in India and is ranked fifth in terms of production, consumption, export, and expected growth. These are the key factor that drives the growth of this segment in the Indian FMCG market during the forecast period 2023-2029.

Food brands and other FMCG products which fall under the impulse purchase category, are dedicating more than 60% to 65% of their marketing spends to BTL activations. On the other hand, FMDG (durables goods sector) is investing majorly in ATL activities. The annual budgets of majordurable goods brands have been increasing 30% YOY in ATL activities and also in Instore promotions.

The focus on agriculture, MSMEs, education, healthcare, infrastructure and tax rebate under the Union Budget 2022-2029 is expected to directly impact the FMCG sector. These initiatives are expected to increase the disposable income of the common people, especially in the rural area, whichwill be beneficial for the sector.

The FMCG sector is a vital contributor to India’s GDP, being the fourth largest sector in the economy it creates employment for more than 3 Mn people. Its main elements are household care, personal care and food and beverages. The phenomenal growth of the FMCG industry especially in the tier II andtire III cities in India is mostly due to the improvement in the standard of living of the people of such cities and the rise in the level of disposable income.

Over the last few years companies like Dabur, HUL and ITC have managed to change the face of the FMCG industry in India by using cutting edge technology in production and a very strong distribution channel. Companies like Colgate Palmolive and Britannia have also managed to penetrate into the urban areas of the country.It is observed that with an investment of US$254.50 Mn, Wipro is diversifying and expanding its product range in energy drinks, detergents, and fabric conditioners.

On the other hand, Patanjali will spend US$743.72 Mn in various food parks in Maharashtra, MP, Assam, Andhra Pradesh, and UP. It is advisable for the FMCG companies to encase opportunities like increasing consumer income, changing consumer lifestyle, aspiring rural consumer and consistenteconomic growth by utilizing its strengths.

India is a country that no FMCG player can afford to ignore due to its middle-class population which is larger than the total population of USA. The Indian FMCG market continues to rise as more people start to move up the economic ladder and the benefits of economic progress become accessible to the public. More crucially, with a median age of just 27, India's population is becoming more consumerist due to rising ambitions. This has been further aided by government initiatives to increase financial inclusion and establish social safety nets.

Growing awareness, easier access and changing lifestyles have been the key growth drivers for the sector. The urban segment (accounts for a revenue share of around 65%) is the largest contributor to the overall revenue generated by the FMCG sector in India. However, in the last few years, the FMCG market has grown at a faster pace in rural India compared to urban India. Semi-urban and rural segments are growing at a rapid pace and FMCG products account for 50% of the total rural spending.

Rural consumption has increased, led by a combination of increasing income and higher aspiration levels. There is an increased demand for branded products in rural India. On the other hand, with the share of the unorganized market in the FMCG sector falling, the organized sector growth is expected to rise with an increased level of brand consciousness, augmented by the growth in modern retail. Another major factor propelling the demand for food services in India is the growing youth population, primarily in urban regions. India has a large base of young consumers who form most of the workforce, and due to time constraints, barely get time for cooking. Online portals are expected to play a key role for companies trying to enter the hinterlands. The Internet has contributed in a big way, facilitating a cheaper and more convenient mode to increase a company’s reach. The number of internet users in India is likely to reach 1 billion by 2025. It is estimated that 40% of all FMCG consumption in India will be made online by 2020. E-commerce share of total FMCG sales is expected to increase by 11% by 2030. It is estimated that India will gain US$ 15 billion a year by implementing GST. GST and demonetisation are expected to drive demand, both in the rural and urban areas and economic growth in a structured manner in the long term and improved the performance of companies within the sector.