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FMCG sales surge ahead of festive season, discretionary items lead growth
Sales are led more by discretionary items like snacks, sweets and beverages that households stock up on during festivities.
September is bringing cheer for consumer goods companies as households stock up for festivals. After FMCG sales tapered off nearly 14.5 percent in August, sales were up about 2.2 percent in the first 21 days of September and this time, sales are led more by discretionary items like snacks, sweets and beverages that households stock up on during festivities.
According to data from retail intelligence platform Bizom, run-up to the festive season has seen sales of packaged foods up 94. 5 percent year-on-year led by ready-to-eat products on the back of rising out-of-home consumption. The uptake for RTE products was very low last year. Confectionery too, on the back of significantly higher availability this year compared to the same time last year, saw sales increase 61.5 percent YoY. Beverage sales too are up nearly 23 percent, and this despite key season for beverages typically being summer months of March to June/July and September being an off-season. Despite discretionary products driving sales, sales of commodities or staples have also seen a consistent rise.
Sales in the personal care category too is inching up at 8.4 percent and is expected to scale up further closer to festival days.
The festive season also sees FMCG majors pushing gift & festival packs, which according to Bizom started soaring since August driven by Raksha Bandhan and continue in September as well in preparation for the upcoming season. Over August, festive packs for Indian sweets are up 46.7 percent, packaged foods up 24.1 percent and beverages up 42.5 percent.
Accordingly, FMCG majors are also lining up launches of new products, gift packs and are rolling out several festive offers. ITC says that this year, the sector is expected to receive the much-needed boost both in the urban and rural markets during the festive period with augmented traffic building events in modern trade and e-commerce.
“ITC is planning to actively participate in the upcoming festivities - both national and regional - with a bouquet of special offers, gift pack offerings, focused product sampling, unique marketing activations, real-time moment marketing initiatives led by the ITC Sixth Sense Command Centre as well as a host of new launches around the festive theme to boost excitement around key ranges. Some of the categories under focus would be biscuits, frozen foods, health range of foods, premium skincare, home care, among others,” a company spokesperson said.
Parle also is highly optimistic about the festive season and is expecting 12-16 percent growth over last year with demand picking up in salty snacks, confectionery, bakery categories. Parle is launching three new variants in salty snacks, along with gifting solutions, Krishnarao Buddha, Sr Category Head – Marketing for Parle says. A special focus for Parle this time will also be on the confectionary category where it will be launching gift packs called ‘Candy Culture’ in October aimed at the festive season.
For snack majors like Bikano festive season brings in 25-30 percent of sales happen during the festive season starting from Rakhi and stretching till Diwali. In the snacks and sweets category, Bikano is expecting a 40 percent growth over the last fiscal year.
“Keeping in mind the expected surge in sales during the festive season, we have recently launched a new range of chai time snacks. Ahead of Rakhi, we launched 6 new gift packs and will extend the range to 15 packs for Diwali which will soon be launched. We saw massive growth in packaged sweets last year. This year we are planning to improve on volume and achieve good growth,” Manish Aggarwal, Director, Bikano, Bikanervala Foods Pvt Ltd told CNBC-TV18.
(Edited by : Aditi Gautam)
First Published: Sept 27, 2021 3:38 PM IST
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