Domestic FMCG Companies are growing rapidly in India - find out why

1. Domestic FMCG Players –
Emerging Giants
Debu Bhatnagar
17.04.10
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2. The FMCG Landscape
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3. FMCG - MNC Leader Board
Turnover (Rs Cr)
HUL 20,000+
Nestle 5,000
Britannia (?) 3,000
ITC Consumer <3,000
Colgate Palmolive <2,000
Reckitt Benckiser <2,000
Cadbury <2,000
P&G <1,000
Perfetti <1000
J&J Consumer <1000
Henkel <500
Lotte <500
L‟Oreal <500 YFactor

4. The MNC Landscape
• HUL is still the „Big Daddy‟ but is steadily losing
dominance. Limited local flexibility
• ITC is behaving like a local company in the
FMCG space
• Reckitt Benckiser and Colgate driven by profit
• New MNCs are in focused areas –
confectionery and personal care companies
have done well
• A host of others: Kelloggs, Heinz and many
imported brands jostling for space
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5. Established Indian FMCG Players
Turnover (Rs Cr)
Nirma 3,000
Dabur 2,500
Marico 2,000
Ghari Detergents Approx 1,500
Godrej 1,100
Emami 750
CavinKare Approx 600
Jyothy Laboratories Approx 550
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6. Emerging Indian FMCG
Players
• Sub 500 Cr Companies
• Experiencing Rapid Growth
especially in the last 7-10 years
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7. Super
Vasmol from
Co T/O
Hygienic
122 Cr
Research
Institute
Co T/O 161
Cr
Keo
Color Karpin
Mate from from
Heena Dey‟s
Exports Medicals
Co T/O 96 Co T/O
Cr 111 Cr
Himgange
Cooling
Hair Oil
Co T/O 88
Cr
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8. What makes them tick?
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9. The „Big Daddy‟ Story
• Losing Focus: HUL on Detergents
– Nirma
• Dominance Woes: Nirma in Detergents
– Ghari
– Power
• Money on the Table: Pepsi/Frito in extruded snacks,
Reckitt Benckiser in mosquito coils, Colgate in
toothpaste
– Prakash Snacks with Yellow Diamond Snacks
– Bingo Mad Angles from ITC
– Bharat Box with Chakravyooh Mosquito Coils
– Anchor Toothpaste
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10. The Indian Market
• „Bottom of the Pyramid‟ – increasing numbers
entering the consumption economy
• „Climb the ladder‟ – constant growth in
economic power at all levels
• „Retail and Media Revolution‟ – drives
consumer choice and information
• „Dilli Chalo‟ – increasing urbanisation
‘The mother of all markets’ – Rapidly increasing demand for ALL
classes of products
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11. Category Pointers
• Exploitable
• Emerging
• Vacated
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12. Exploitable Categories
• „Unique to India‟ Propositions
• „Below the radar‟ Brands
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13. „Unique to India‟
• Legacy • Indian habits and Perceptions
– Amrutanjan – Oil Based Hair Dye – Super
– Boroline Vasmol
– Jabakusum – „Cooling‟ Hair Oil
• „Indian‟ Categories – Kali Mehndi
– Fairness Cream – not any – Kajal, Bindi, Sindhoor
more! – Chywanprash, Hajmola
– Hair Oil – many times bigger – Kesh Nikhar
than shampoo! • Indian Taste
• Herbal/Ayurvedic/Unani – Snack Foods
Products – Masalas
– Shahnaz Husain – Idli Dosa Batter
– Rooh Afza, Safi
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14. Below the Radar Brands
• Exploit “interstitial” spaces that the vast Indian market
offers
• Regional focus
• More wholesale oriented distribution
• Tier 2-3-4 towns
• Lower price
Lissa Soap from Raipur
• Higher trade margins
• Positive product tweaks
– Perfume
– Packaging
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15. Emerging Categories
• Ready to Cook/Eat
– ID Special; Meatzza
• Deodorants, Perfumery and Male
Grooming
– Park Avenue
– Wild Stone
– Z Talc
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16. Vacated Categories
• Clothes Blue: Robin
– Ujala
• Shaving Cream: Erasmic
– Vi John
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17. MNC Woes
• In the „70s and „80s HLL behaved like an
Indian Company with Global Systems
and People
– Rin
– Fair & Lovely
– Wheel was the last hurrah
• They attracted the best talent and there
was a vast gap between them and the
closest Indian competitor
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18. Today….
• There is no difference in the quality of
people and systems between HUL,
Dabur and Marico
• HUL is caught in a trap of its own making
– Power Brands = Low Innovation
– Central Control = Bureaucracy
– All things to all people = nothing to nobody
– Media vs Market
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19. David to Goliath…
• Courage is being scared to death – but
saddling up anyway: John Wayne
• Lack of money is no obstacle. Lack of ideas is:
Ken Hakuta
• Gift Karsanbhai Patel an overhead slide
projector: Hindustan Lever in the ‘80s
And when all else fails…..
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20. Call Us!
Thank You
YFactor Marketing Pvt. Ltd.
1176, Sector A, Pocket A, Vasant Kunj, New Delhi 110070, INDIA
Tel: +91 11 2613 6369; Mob: +91 97177 74290 (Debu); +91 98197 23242 (Shashi)
debu.bhatnagar@yfactor.in; shashi.kalathil@yfactor.in
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