The fallen FMCG market has gotten a dynamic breather due to the upsurge in demand for beverages, convenience foods, snacking, and premium personal care products, which has increased significantly from a year ago.
“The situation began during COVID and India’s tough pandemic—appreciation of packaged food improved significantly, and it has now catapulted,” said Kalpesh R. Parmar, country general manager, Mars Wrigley India. “So, when one wants small moments of happiness, the consumer opts for a packaged snack, either a biscuit or chocolate and chips.” Parmar added, “Because of the consumer mindset changing, they are going for packaged products and not local products, which are handmade.” “It was never a big worry, but now people are being cautious.”
Data from global consumer research firm Kantar Worldpanel (formerly IMRB) showed that in the 12 months ended October, the beverages sector grew 24%, convenience food – including noodles, pasta and cereals – grew 13%, while snacking segments such as chips, cookies and chocolates expanded 12% by volume, Volume indicates the unit number of products bought or consumed.
Last year, the beverages segment had just started to recover from the lows of the pandemic’s first summer in 2020. A harsh summer and pent-up demand helped the segment grow 54%. Several ready-to-eat and ready-to-cook products grew during the pandemic and offered easy stocking and snacking options.
In July-September, consumption of packaged consumer goods fell for the fifth consecutive quarter, with the FMCG market shrinking 0.5% year on year, led by food products amid rising prices.
FMCG fell marginally by 0.5% even during the year ended October, but the decline could have been steeper if not for these sectors that outperformed all expectations,” said Kantar.
Shoppers are starting to get increasingly habituated to convenience foods and alternate formats. Alternate Formats Alternate categories or premium sub-segments, including liquid soaps, detergents, and dishwashing, grew 30%.
“If you look at premium categories, the consumer is different, and the way they buy is also different,” said Sameer Satpathy, chief executive of personal care at ITC Ltd.