This week on Industry Insight we feature a current report on the cosmetic line of products which sees a forecast with new concepts.
The fast moving consumer goods (FMCG) segment is the fourth largest sector in the Indian economy. The market size of FMCG in India is estimated to grow from US$ 30 billion in 2011 to US$ 74 billion in 2018.
In terms of Personal care (22 per cent) of market share is growing compared to 2014.
Ayurveda and Herbal have tremendously grown over the few years with the youth between the age group of 19-26 approaching cosmetic counters of herbal, organic and ayurvedic products in large.
Growth in awareness, easier access, and changing lifestyles has been the key growth drivers for the sector.
With rise in disposable incomes, mid- and high-income consumers in urban areas have shifted their purchasing trend from essential to premium products. In response, firms have started enhancing their premium products portfolio. Indian and multinational FMCG players are leveraging India as a strategic sourcing hub for cost-competitive product development and manufacturing to cater to international markets.
According to a study by TMW and Marketing Sciences that surveyed 2,000 people across different age groups ranging, young consumers are the most ‘rational’ and likely to spend more time weighing up potential purchases. The survey also suggests that younger people are using recommendations from their peers about products and services in order to make rational purchase decisions. According to the study, shoppers aged 18 to 24 are 174 per cent more likely to use recommendations on social media than shoppers aged 25 and over.
Another key factor today is – speed. Today’s consumer desire packaged goods that work better, faster, and smarter. The “ need for speed” trend highlights the importance of speed as a potentially decisive purchase factor for packaged goods products in a world where distinctions between products are shrinking.
Youth and even the middle aged have taken keener into spiritual guru endorsed or manufactured brand as mentioned lately.
Younger consumers express the greatest need for speed, not a huge surprise for the smartphone generation. Datamonitor’s 2013 Consumer Survey found that younger consumers those in the 15-24 year old age group were twice as likely to say that “results are achieved quickly” has a “very high amount of influence” on their health and beauty product choices than consumers in the oldest age group, those aged 65 or older. Speed matters, and 2014 will almost certainly see the introduction of new game-changing timesavers.
One area that we see global and local FMCG brands investing more in is health and wellness. Health and wellness is a mega trend shaping consumer preferences and shopping habits and FMCG brands are listening.
Lately, we have all been reading Abneesh Roy, Associate Director at Edelweiss Securities feature. He has mentioned in the press that ‘With more and more spiritual gurus entering the fast-moving consumer goods (FMCG) space, competition for market share seems to be intensifying. After Baba Ramdev’s Patanjali, Art of Living pioneer Sri Sri Ravishankar’s FMCG company Sri Sri Ayurveda (SSA) is posing a considerable threat to other players. SSA, which was established in 2003, has now started gaining momentum post the success of Patanjali. “They are expected to capitalise on Patnajlai’s gains,”. Roy says that focus in now shifting more towards the ayurveda space and herbal products, which is expected to expand in future.
Appealing factors in these products:
MRP of the products is minimal
Packaging is simple
List of quality ingredients and preservatives (if included are clearly mentioned)
Essential and basic products are only manufactured.
Availability at most supermarkets.
Some of the prominent factors in the popular brand of recent days are:
Sri Sri Ayurveda: All Sri Sri Ayurveda employee meditate daily to ensure that their products are developed in the most positive and energic atmosphere ever.
Patanjali Ayurved: The concept for forming this Company was to link the rising destiny of millions of rural masses on the one hand and many more suffering and leading unhealthy urban lifestyle on the otherâ€. The Vision of the Respected Swami Ramdevji Maharaj, the renowned YOGA GURU and Sri Acharya Balkrishnaji, made the concept into writing through formation of the Company PATANJALI AYURVED LIMITED.
Some interesting facts apart from the manufacturing, packaging and R&D is the factor of building the conscience of the products through positive vision and natural ingredients.