Join the WOOB Community TODAY!
Register Now!
Saturday, October 31, 2020

CPG brands in India must embrace new consumer trends to thrive

Covid-19’s impact on the consumer landscape in India have given rise to new trends that consumer-packaged goods (CPG) brands must embrace, according to analysis from Kearney.

“While there is a clear cascading impact of consumer trends in channels and supply chains, there are some independent trends and back-end implications that we can expect in the post-Covid environment,” said the consulting firm.

Demand surges for affordable health, hygiene & organic products

Despite the substantial premium that comes with these products, the naturals and organics trend has been gaining traction in India’s CPG space, with an overall CAGR of 18-25%. Covid-19 will fuel health-focused demand as consumers move toward prevention – seeking immunity from consumables, hygiene from personal and home care, and chemical-free from personal care. The firm noted that the trends will also drive the transition in consumer preferences from private labels to known brands.

- Advertisement -

However, the pandemic also induced a conservative and savings mindset, making affordability an increasing important aspect. Companies that can position health-branded products in the affordable, mild-premium range of 10-20% are likely to win in the new normal. Taking a cue from China, local skincare brands such as Inoherb and Chando have already launched products that promote a healthy and holistic lifestyle. A study by Kearney found that more than 60% of consumers say they are willing to pay 10-20% more for healthier products.

Expert communication will drive trust in a brand

Many consumers are seeking trustworthy brands that do good, as the pandemic amplifies consumers’ desire for trust in times of vulnerability and uncertainty. Brands will need to communicate with emotion, compassion, and facts about how they are offering solutions that will impact people’s lives. In addition, consumers will seek brands that display real expertise, no frills, unprejudiced patriotism, and social care with a sharper value proposition.

Premiumisation will earn support as consumers indulge in retail therapy

As eating out and travelling continue to remain depressed in the medium term, select premium and indulgence categories will see an uplift, said Kearny. Retail therapy will see a surge as people seek outlets during this stressful period, from ready-to-eat meals to self-indulgent large purchases.

The study found that 80% of consumers are spending more money than usual to pamper or indulge themselves. More than 70% of Chinese consumers think grooming routines are a good way to reduce stress during the lockdown. In the United Kingdom, luxuries such as premium skincare and sparkling wine are the biggest winners as nonessential products for lifting people’s moods during tough times.

Reaffirming value offered for the price charged becomes a focus point

Availability issues during the lockdown have forced many consumers to try new brands—often a lower-cost alternative. According to an Ipsos study, about 60% of Indian consumers have tried a new brand or product in the past four to five weeks because their regular ones were unavailable. If they perceive these new purchases to be just as effective, these sales will likely result in a permanent conversion.

About half of the respondents in Kearney’s study are willing to move to a lower-cost alternative if it offers similar quality as their usual purchase. Pandemic-induced financial insecurity will give an added boost to this experimentation behaviour—making it crucial for brands to manage their perceived brand value with explicit branding of differentiating features.

- Advertisment -

Latest News

Deliciuos Delight!

Swad, is beyond a regular packaged food brand. It is food filled with taste of love, celebrations, warmth and happiness; power-packed with...

A way to a healthy lifestyle

Basil Group is a family owned business with an established track record in the cotton and chemical industry. They keep identifying the...

Leading business collaborative platform for FMCG, Trace One is leveraging its extensive industry reach with Trace One Marketplace

The pressure on both retailers and CPG firms to meet the constantly changing needs of a demanding consumer base has never been...

Principles of Great Packaging Design.

“Jo dikhta hai woh bikta hai” (What is visible, sells) goes the popular adage. Packaging design’s primary job is to make the...

Safety concerns, ease of online buying to keep Mumbai shoppers away from stores in festive season

Concerns about safety amidst the Covid-19 pandemic along with better pricing and ease of return and refund on buying online may keep...

BigBasket bets on in-house segments, plans to expand private label cart

With demand for private labels seeing a surge on its platform, online grocery BigBasket is betting big on the in-house segment with...

“Our focus is to be an omnichannel retailer,” says Shashwat Goenka, Sector Head (FMCG & Retail), RP – Sanjiv Goenka Group

Spencer’s, the oldest modern retail brand in India, is the pioneer in hypermarkets in India, having introduced the first one in 2001....

Marico logs volume growth, notices revival in consumer demand in Sept quarter

FMCG major Marico said it has witnessed a partial revival in the consumer sentiment in the second quarter of the current fiscal...

Five things on consumption shift during covid

As India moved to prevent the spread of Covid-19 with a lockdown late March, household budgets and consumer behaviour have since shifted....

Festival season sales: Over 50% consumers to shop online, says survey

About 51% of consumers doing festive shopping this year will use e-commerce sites and apps as their primary channel, a sizable change...