The above-normal rainfall across India has set its foot in with green shoots in the fast-moving consumer goods (FMCG) category. The sector, which was marred by muted top-line growth and a delayed rural demand recovery due to the uneven spread of the monsoon impacting demand in the previous year, is signalling a positive sentiment this time around.
Many may wonder why healthy monsoons remain critical- it is because around 46 per cent of the country still depends on agriculture as an income source. When monsoons remain inadequate or extreme, they can potentially impact the next six months of the purchase cycle, including the festive time.
But when there is a good monsoon, it is good news for most brands in the biscuits, confectionery, salty snacks, and bakery products portfolio. This further augers improved ad budgets and engaging communication strategies that lure consumers into buying.
Positive Consumer Sentiment = Buoyancy In Festive Spends
The silver lining that the current festive time is displaying is primarily backed by an uptick in consumer sentiment. Retailers, including those in the FMCG sector, are expecting at least 10-12 per cent growth over last year’s sales, according to Wright Research.
“The onset of the season starting with Ganesh Chaturthi followed by Navratri, Diwali and beyond – contributes as a major economic catalyst in the country. Auspicious buying, marketing and discounts, deferred purchases are a combination of festive euphoria and tempting deals that sparks consumer spending during festival months,” the report states.
In tandem with the industry trends, Krishnarao Buddha, senior category head, Parle Products shares that there will be an increase in the festive budget, between 15-20 per cent over the previous year. “We are definitely looking at having a high presence overall, with a 360-degree approach across channels. To have a better presence and a higher share, we want to have a high decibel activity, or high decibel touch points from the consumers' perspective across ecommerce, quick commerce, modern trade and general trade,” he adds.
For context, the advertising investments by the FMCG brands ramped up in the October-December quarter of the fiscal year 2024, registering a noticeable drive to capture market share amidst festivities and sporting extravaganzas.
Top players such as Hindustan Unilever (34.49 per cent), Dabur (36.13 per cent), Colgate Palmolive India (20.20 per cent), P&G (14 per cent), Godrej Consumer Products ( 24.47 per cent), recorded a double-digit spike in advertising and promotional expenditure for the October-December quarter, year on year.
“Marico’s advertisement spending saw a 13 per cent increase in FY25, with a strong focus on traditional and digital platforms that now account for a significant portion of our media spend for campaigns, across categories,” mentions Somasree Bose Awasthi, CMO, Marico.
Anthony Dsouza, executive director & country service line leader, innovation, Ipsos India also advocates that FMCG brands will up their budgets anywhere from 15-30 per cent given the increased rural confidence and spending, along with good monsoons.
Marketing Strategies Will Matter
As we head into the festive season, engaging consumers through interactive and personalised strategies will be a key focus for brands in the FMCG space. “This could include contests, loyalty programs, and personalised offers. A significant focus will also be on digital and ecommerce channels,” believes Dsouza.
Giving us a sneak peek into Marico’s marketing plans, the brand will focus on creating campaigns, across categories, that capture the celebratory spirit. “We will leverage data-driven insights to personalise marketing messages, ensuring relevance to individual consumer preferences and behaviours. This approach has become increasingly important in our industry, where brands must adapt to evolving consumer sentiments,” comments Awasthi.
Customer-centricity will continue to remain at the heart of Marico’s strategy, driving its efforts to strengthen customer engagement in the dynamic FMCG market. The brand will also leverage effective storytelling to connect with consumers, tapping into nostalgia, family traditions, and cultural festivities. This is to build brand affinity and loyalty while delivering memorable experiences that resonate with consumers.
Parle, on the other hand, plans to introduce a range of gifting solutions including festive special gift packs during the celebratory times. The expectation is to have a huge impact through its media campaigns and touchpoints. “That would mean a higher market share. Even in terms of our product consumption, it is definitely bound to be carried forward through the year, lasting till Christmas, New Year, and even Pongal,” mentions Buddha.
With confidence in FMCG’s recovery and growth, favourable monsoons and a robust investment plan add up to a colourful festive season, enabling brands to reach consumers in meaningful ways.
