FMCG Firms Bank On Higher Volumes In Rural Market

Monday, April 25, 2011

NEW DELHI: Aiming for a deeper penetration in rural markets, FMCG (fast moving consumer goods) majors, including Coca-Cola, PepsiCo and Britannia, are introducing products in low price points particularly in the Rs 5 category as part of their strategy to shore up volumes.

While global beverages firm Coca-Cola has introduced ’Fanta Fun Taste’ powder sachet for Rs 5 targeting the lower end of the market, Pepsico had also recently brought out 200 ml bottle for Rs 5 for its popular lemon flavour drink ’Nimbooz’ as part of a promotional offer.

According to these companies, the bottom of the pyramid segment provides a huge opportunity although it currently contributes only 20 per cent of India’s consumption and “is tipped for explosive growth.”

“According to some estimates, by 2015, more than half of the consumption spending in India would come from families earning nearly Rs 25,000 per month, which makes them a market ready to be tapped,” a Coca-Cola spokesperson said.

The company, which has launched ’Fanta Fun Taste’ powder in 23.5 gm sachet as pilot project, plans to place the product in around 1,500 retail outlets in Maharashtra and Gujarat by the next week.

Source: The Economic Times (link opens in a new window)