NielsenCOVID-19 Impact On FMCG and Retail 17th April Final Deck

COVID-19: IMPACT ON FMCG AND
RETAIL
Edition 2
Prasun Basu, South Asia Zone President, Nielsen Global Connect

Sameer Shukla, West Market Lead - South Asia, Nielsen Global Connect
April 17, 2020
Copyright © 2020 The Nielsen Company (US), LLC. Confidential and proprietary.
Copyright © 2020 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute.
PRASUN BASU SAMEER SHUKLA

President- South Asia Zone, West Market Leader- South Asia,
Nielsen Global Connect Nielsen Global Connect
Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 2

AS COVID-19 SWEEPS THE WORLD, CONSUMERS ARE BEING FORCED TO
DRAMATICALLY CHANGE THEIR PURCHASE BEHAVIOUR.
NIELSEN IS TRACKING THIS THROUGH SIX KEY CONSUMER BEHAVIOR THRESHOLDS. THESE
THRESHOLDS OFFER SIGNALS OF SPENDING PATTERNS BEING MIRRORED ACROSS MULTIPLE
MARKETS.
AS BRANDS AND RETAILERS PREPARE FOR THE DISRUPTION IN NORMAL PURCHASE TRENDS,
NIELSEN IDENTIFIED THREE CRITICAL ACCELERATORS, FOR THE MARKET TO RESPOND TO
SHIFTING CONSUMER BEHAVIOR:
● QUALITY AND ● RISE OF LOCAL ● TECHNOLOGY

EFFICACY ORIGIN CATALYST
BRINGING THE ACCELERATORS AND THRESHOLDS TOGETHER AS CLIENT IMPLICATIONS AND

WINNING STRATEGIES.

NIELSEN’S SIX CONSUMER BEHAVIOR THRESHOLDS
#1 #2 #3 #4 #5 #6
PROACTIVE HEALTH- REACTIVE HEALTH PANTRY QUARANTINED RESTRICTED LIVING A
MINDED BUYING MANAGEMENT PREPARATION LIVING LIVING NEW NORMAL
PREPARATION
Interest in health and Health and public Pantry stockpiling of Increased online Restricted shopping Return to daily
wellness products . safety products health-safety products. shopping trips, online fulfillment routines Permanent
prioritized . e.g. face Strain on the supply is limited, Rising price shifts in channel mix,
masks chain. concerns supply chain, and
hygiene practices.
Belarus, Nicaragua Brazil; Iran; Iraq; India, European

Japan; Angola Union, USA; Russia; China
Italy; UK; Spain
Nielsen Proprietary
IN THE LEAD UPTO RESTRICTED LIVING, BIGGER SURGE SEEN IN WESTERN
MARKETS THAN IN INDIA
#1 PROACTIVE HEALTH-MINDED #2 REACTIVE #3 PANTRY #4 QUARANTINED #5 RESTRICTED
BUYING HEALTH MGMT. PREP LIVING PREP LIVING
Italy USA India (Scantrack) India (GT)

63
Part/ Full country
Lockdown - mid of March
58
1st death - Feb 29

end to March 12 28
1st
case confirmed in all 3
countries towards end Jan 18
17 16
11
15
11 14
7 10
8 6
3 3 2 6
2
0
W/E-4/1 W/E-11/1 W/E-18/1 W/E-25/1 W/E-1/2 W/E-8/2 W/E-15/2 W/E-22/2 W/E-29/2 W/E-7/3 W/E-14/3 W/E-21/3 W/E-28/3
JANUARY FEBRUARY
-8
Fig are % Vs. YA Monthly unprojected growth of stores audited in Respective week as compared to SPLY. W4 for TT - Imputed data.

'EVOLVED HYGIENE’ AND STAPLE FOODS FLY OFF SHELVES AS
COUNTRIES ENTER RESTRICTED LIVING.
Country Evolved Hygiene Food
Hand Sanitizer 569% Canned Pasta-226%
Germany Toilet Soap- 258% Spreads & Pastas- 112%
Household cleaners- 135% Noodles- 167%

Liquid Soap - 439% Pasta -261%
Spain Alcohol Antiseptic- 391% Rice -257%
Antiseptic- 269% Canned ready Meals- 184%
Aerosol Disinfectant 267% Powdered Milk-286%
Rubbing alcohol 192% Dried beans-377%
USA Hand Sanitizer 193% Canned Meat- 282%
Rice- 234%
Hand Sanitizer 1975% Shelf stable Milk-62%
Italy Kitchen cleaner- 128% Canned Food- 56%
Hand Soap - 103% Frozen Foods- 48%
Hand Wash 199% Packaged Atta -45%
Hand Sanitizers- 1228% Packaged Rice - 67%
India Floor Cleaners - 69% Breakfast Cereal – 66%
Cheese – 66%
Fig are Value Gr % Vs. YA
Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 The week defines the start of restricted living phase 6
SOCIAL MEDIA CONVERSATIONS PLATEAU THROUGH THE
FIRST PHASE OF LOCKDOWN
Social conversation peaked
on Janta Curfew day.
21 Days
Janata Curfew and
Lockdown Appeal and

5baje5minute
announced Donation to PM
clapping #9baje9minute
Cares Fund
Janta Curfew
announcement Lockdown
Celebrities, Extended
PM Modi & Amit Cricketers,
Shah announce not
Politicians etc.
to attend Holi Milan supports the
programme announcement
Quarantined
Proactive Health Minded Reactive + Pantry
Buying Preparation
Living Long Haul of Restricted Living
Preparation
Source: Nielsen Social Intelligence with Talkwalker - A Social Media data platform; FB & Insta not included
Data for Covid Cases taken from MoHFW (Ministry of Health & Family Welfare)
*Timeline: 1st Feb 2020 – 14th Apr 2020 Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 7
INDIANS LOOK AT THE BRIGHTER SIDE
As Resilience Builds, Nation Reacts With Collective Resolve
#CautionYesPanicNo,
India Entry #CoronareachesDelhi, #CoronavirusIndia,
Scare #CoronaVirusUpdate, #COVID19India
#CoronavirusPandemic,
#SwasthaBharat, #HelpUsToHelpYou,
Pandemic
#KaroNamaste, #Sanitizer,
Precaution #CancelEverything, #SafeHands, #Mask,
#SayNoToPanic
Community #CoronaOutbreak, #SocialDistancing,

Fightback #SafeHandsChallenge, #CoronaFighters
#IndiaFightsCoronavirus,
#IndiaFightsCorona, #COVIDIOTS,
Standstill #CoronavirusLockdown,
Life #StayHomeStaySafe, #BreakTheChain,
#JantaCurfew
#StayHomeSaveLives,
#CoronaKoDhona, #Waragainstvirus,
#Lockdown, #StayHome,
#CoronaStopKaroNa, #StayHomeIndia,
Rise of a #LockdownNow, #21daylockdown,
Nation #9Baje9Minute, #CoronaLockdown,
(compassion #Lockdown21
+ collective
#ThankYouCoronaWarriors,
resolve) #ClapForOurCarers, #PMCaresFund,
#PMReliefFund, #CMReliefFund,
#DonateKaroNaIndia, #CoronaWarriors,
#Heroes
Source: Nielsen Social Intelligence with Talkwalker - A Social Media data platform
FB & Insta Not included
*Timeline: 1st Feb 2020 – 14th Apr 2020 Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 8
INDIA’S RESPONSE TO COVID-19
This artwork was created using Nielsen data.

Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 9
SHARP FALL WITNESSED ACROSS CHANNELS, POST HIGH DOUBLE
DIGIT GROWTH FOR FIRST THREE WEEKS OF MARCH
TRADITIONAL TRADE
MODERN TRADE
15% 63%
10%
Dec+Jan+Feb 6% 24% 29%
D+J+F
5% 6%
13%
-8%
W/E 8-Mar W/E 15-Mar W/E 22-Mar W/E 29-Mar W/E 8-Mar W/E 15-Mar W/E 22-Mar W/E 29-Mar
Val Gr vs YA Val Gr vs YA
E-COMMERCE CASH AND CARRY
103%
61%
87% 85%
24%
D+J+F 6%
12%
-64% -44%
W/E 8-Mar W/E 15-Mar W/E 22-Mar W/E 29-Mar W/E 8-Mar W/E 15-Mar W/E 22-Mar W/E 29-Mar
Val Gr vs Avg Feb sales Val Gr vs YA

Monthly unprojected growth of stores audited in Respective week as compared to SPLY. W4 for TT - Imputed data.
10
Nielsen COVID-19 Impact on FMCG and Retail: Edition 2
FALL PROPELLED BY SUPPLY AND RETAIL POINTS ISSUES
SUPPLY ISSUES Consumers find Out of Stock* SHORTAGE OF STAFF AT RETAIL
DURING LOCKDOWN Grocery Essentials
Atta, Rice, Lentils, Pulses, Oil, Ghee
15%
1 in 4 retailers in Urban India
Personal Hygiene had issues with staff not able

Hand Wash, Toilet Soap
13% to turn up
- 80% Salesperson visits
for replenishment Laundry products 10%
Detergents, Washing Powder/ Bar
Hand Sanitisers 31%

66% Lack of transport
8 of 10 Had supply and

Face Mask, Gloves 30%
retailers out of stock
51% Police restrictions
challenges
Salty Snacks 22%
Ready to Eat 22%

Instant Noodles, RTE upma, etc. 54% Feared contracting virus
65% Sourcing from
Grocer Skin Care 15%
Wholesalers at Face Wash, Moisturisers
33%
Chemist higher rates Dairy Products 34% Left for hometown
14%
Milk, Cheese, Curd
*Category/ Preferred brand not available

GROWTH ACCELERATED ACROSS FMCG BASKETS UP UNTIL
LOCKDOWN IN MODERN TRADE
TRADITIONAL TRADE FOOD MODERN TRADE BANNERS

Value Gr YA
37% 98%
77%
75%
12%
9% 18%
9%
8% 9% 8%
16%
7% 17% 12%
5% 7%
Dec+Jan+Feb WE 08-03-20 WE 15-03-20 WE 22-03-20 WE 29-03-20 Dec+Jan+Feb WE 08-03-20 WE 15-03-20 WE 22-03-20 WE 29-03-20
Staples – Refined Edible Oils, Pkd Atta, Pkd Pure Ghee, Pkd Tea, Pkd rice etc
Snacking & Processed Food – Biscuits, Salty Snacks, Vermicelli & Noodles, etc
Lifestyle – Cheese, Ketchups/Sauces, Milk Powders, Jams/Jelly etc
Chocolates & Confectionery – Chocolate, Toffees, etc.
GROWTH ACCELERATED ACROSS FMCG BASKETS UP UNTIL
LOCKDOWN IN MODERN TRADE
NON - FOOD
TRADITIONAL TRADE MODERN TRADE BANNERS
165%
339% 64%
47%
36%
17%
7% 6%8%
5% 8%
3%
2% 6%
2% Dec+Jan+Feb WE 08-03-20 WE 15-03-20 WE 22-03-20 WE 29-03-20 5% 11% 4%
11% 0% Dec+Jan+Feb WE 08-03-20 WE 15-03-20 WE 22-03-20 WE 29-03-20
Essential Personal Care – Toilet Soaps, Tooth Pastes, Shampoos, Diapers Sanitary Napkins, etc Essential Home Care Essential Personal Care
Essential Home Care – Washing Powders, Cleaners-Utensil, Cleaners- Toilet, Detergent Cakes, etc.
Evolved Hygiene – Liquid Toilet Soaps, Cleaners- Floor Other Personal Care Other Home Care
Other Home Care – Glass Cleaner, Mosquito Repellent, Air Freshener, etc. Evolved Hygiene
Other Personal Care – Skin Creams, Hair Dyes, Hair Conditioners etc.
INDUSTRY SPEAKS
Source: Nielsen CXO survey on COVID-19 from Apr 9-14 2020

SUPPLY CHAIN LOGISTICS EMERGES AS THE BIGGEST
INDUSTRY CONCERN
Supply Challenges faced by the industry Demand

Side Side
-100%
-80%
-60%
-40%
21%
7% -20%
Past 1M 100% 50% 29% 0% 36% 50% 0%
0%
Next 6M 86% 21% 21% 14% 50% 7% 64% 14%
14% 20%
40%
60%
80%
Challenges In Price Surge For Limited Ability
Closure Of Non Essential 100%
Production Cafes/ Bars/ Items Major Buying
Supply Chain & Sourcing Of Raw & Cash Flow To
Capacity Restaurants Part Of Deferment By
Mobility Issues Raw Packaging Issues Engage With
Shortage Impacting B2B Company Consumers
Materials Material Customers
Sales Portfolio

INDUSTRY LEADERS OUTLINE RECALIBRATION OF INNOVATION
AND DISTRIBUTION STRATEGY AS A FOCUS AREA
TOP ACTIONS Next 12M Past Few Weeks
Review and adjust distribution strategy to focus more online 57% 50%
Adjust supply chain and distribution strategy 50% 43%
Hold new initiatives planned for 2020: review 2020 strategy 43% 50%
Reduce spends on Media and Research 43% 29%
Cut on Discretionary spend: Entertainment, Training, Travel, etc. 43% 29%
Reprioritize production capacity to most needed product

categories 36% 14%
Adjust innovation strategy 27% 71%
Postpone recruitment, organisational restructuring 0% 7%

OPPORTUNITIES IN 2020 GOVERNMENT EXPECTATIONS
Source: Nielsen CXO survey on COVID-19 from Apr 10-15 2020 Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 17
GLOBALLY, INTERSECTING CONSUMER BEHAVIOUR
ACCELERATORS AND THRESHOLDS WILL TRACK LONG TERM
BEHAVIOUR SHIFT

QUALITY AND EFFICACY: HYGIENE AND IMMUNITY TOP OF MIND
SOCIAL MEDIA CONVERSATIONS AROUND IMMUNITY/ GERMS GO UP
2,50,000
2,00,000
1,50,000
Germs
1,00,000
Immunity
50,000
0
Dec'19 Jan'20 Feb'20 Mar'20
Source: Nielsen Social Intelligence with Talkwalker - A Social Media data platform; FB & Insta not included
EVOLVED HYGIENE CATEGORIES SEE HUGE MODERN TRADE BANNERS SEE A SHARP RISE IN
SURGE IN DEMAND IN MARCH SALE OF IMMUNITY BOOSTERS
340%
81%
Dec+Jan+Feb Mar'20
35% 38%
60% 10% 7%
24% 7% 12% 24% 2%
Hand Sanitizers Hand Wash Cleaners-Floor Branded Packaged Chyavanprash Turmeric

Honey
INCREASED
COVID-19 TO‘QUALITY
ADOPTION OF
– AWARENESS ACTION AND EFFICACY’ BY
CONSUMERS
ACTION
Use of Face Masks
and Handwash as
Staying away from prescribed is being
Washing hands
Using face masks multiple times Using hand public gatherings/ practiced almost
when outside for 20 secs sanitisers group meets
universally by Urban
Mar 17-19 Apr 10-14 Mar 17-19 Apr 10-14 Mar 17-19 Apr 10-14 Mar 17-19 Apr 10-14 Indians.
52% 90% 62% 89% 58% 87% 55% 83%
SURAKSHA STORES
Government initiative to
Keeping 1-2m Home remedies to
distance from Avoiding non boost immunity – Eating Vitamin empanel 2 million retail
unknown people vegetarian food honey, turmeric, etc. supplements tablets outlets in partnership
Mar 17-19 Apr 10-14 Mar 17-19 Apr 10-14 Mar 17-19 Apr 10-14 with FMCG companies ,
Mar 17-19 Apr 10-14
16% 27%
as Sanitised Outlets
52% 82% 37% 55% 28% 52%
adhering to safety norms
Source: Online Survey (Apr 10-14 2020) over a sample of 1330 respondents in over 23 metros and cities Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 20
LOCAL BRANDS PLUG NEED GAP
HAND SANITIZER PACKAGED RICE

All India Modern Trade Banners
Smaller players jump in to exploit the demand surge
29% 28%
36%
15% 15%
61%
Others
Others Top 3
Top 3 85% 85% 71% 72%
64%
39%
Jan-20 Feb-20 Mar-20 Jan-20 Feb-20 Mar-20
152 New Players in Hand

Sanitizers in Mar’20

46% Value share of new
players in Mar’20
21
TECH CATALYSTS
Online Offerings And Tech Based Enablers Will Grow In Importance
Use of Whatsapp for product ordering

and delivery
57% Corporate Leaders Talk

Use of Mobile Apps to track and About More Focus On Ecom As
create awareness on COVID (Aarogya Top Priority In Next 12 Months
Setu)
Companies partnering with delivery

agents for last mile delivery 39% Consumers Stated That
They Will Increase Online
Online aggregators diversifying to Shopping By More Than 20%,
meet current consumer needs Post Covid Situation

CONCLUSION
Copyright © 20120 The Nielsen Company. Confidential and proprietary. 23

LESSONS FROM THE PAST: RETAIL’S RECOVERY IN 3 ASIAN
CRISES: SARS Outbreak in China, Fukushima Nuclear Disaster & Earthquake in
Japan, MERS Outbreak in South Korea

INDIA WHAT LIES AHEAD FOR CONSUMERS?
CONSUMERS WILL BE FOCUS ON HEALTH & HYGIENE TECHNOLOGY TO ACT AS
BEARISH ON DISCRETIONARY FACETS AND FINANCIAL SECURITY A CATALYST FOR
SPENDS IN THE UPCOMING MAY BE THE EMBEDDED FUTURE CONVENIENT, ENHANCED
MONTHS BEHAVIOUR SHIFTS CONSUMER EXPERIENCES
64% intend to spend less on 55%+ intend to buy more of personal 39% stated they intend to
restaurant and movie theatre hygiene and safety products in the increase online shopping by
visits coming times more than 20%
54%+ plan to decrease spends on 56%+ will increase spends on healthy, 64% stated OTT platforms,
automobiles, luxury brands and organic food, medical needs, fitness, WIFI connection integral to
leisure travel mediclaim getting through the lockdown
43%+ to defer spending more on 47% consider spending more on 40% planned to increase
fashion, personal grooming and education spends on entertainment &
home décor tech enablers - Apps, OTT,
41% planned to increase investments DTH, WIFI
42%+ to spend less on alcohol across various financial instruments
and tobacco products
Source: Online Survey (Apr 10-14 2020) over a sample of 1330 respondents in 23 metros and cities
QUALITY AND
RISE OF LOCAL ORIGIN TECHNOLOGY
EFFICACY WILL WIN
PREFERENCE CATALYSTS
SHOPPERS
EMPHASIZE QUALITY AND BE TRANSPARENT ABOUT LEVERAGE

EFFICACY LOCAL ORIGINS TECHNOLOGY
A clear communication from 1. By meeting changing consumer

manufacturers. why their COVID-19 Concerns are a likely demands online and DTC offerings
products and supply chains opportunity for local challenger 2. Enhancing consumer experience
should be trusted brands by building and collaborating
technology based services
Even after restrictions lessen, many new consumer habits will be ingrained. Agility to recognize
new consumer behaviours and adapt to meet the altered needs will be the success mantra for
manufacturers and retailers.


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COVID-19: IMPACT ON FMCG AND

Prasun Basu, South Asia Zone President, Nielsen Global Connect

PRASUN BASU SAMEER SHUKLA

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 2

● QUALITY AND ● RISE OF LOCAL ● TECHNOLOGY

BRINGING THE ACCELERATORS AND THRESHOLDS TOGETHER AS CLIENT IMPLICATIONS AND

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 3

Belarus, Nicaragua Brazil; Iran; Iraq; India, European

Italy USA India (Scantrack) India (GT)

1st death - Feb 29

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 5

Household cleaners- 135% Noodles- 167%

Lockdown Appeal and

Community #CoronaOutbreak, #SocialDistancing,

This artwork was created using Nielsen data.

E-COMMERCE CASH AND CARRY

Val Gr vs Avg Feb sales Val Gr vs YA

Personal Hygiene had issues with staff not able

Hand Sanitisers 31%

8 of 10 Had supply and

Ready to Eat 22%

*Category/ Preferred brand not available

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 11

TRADITIONAL TRADE FOOD MODERN TRADE BANNERS

Source: Nielsen CXO survey on COVID-19 from Apr 9-14 2020

Supply Challenges faced by the industry Demand

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 15

Adjust supply chain and distribution strategy 50% 43%

Reduce spends on Media and Research 43% 29%

Cut on Discretionary spend: Entertainment, Training, Travel, etc. 43% 29%

Reprioritize production capacity to most needed product

Adjust innovation strategy 27% 71%

Postpone recruitment, organisational restructuring 0% 7%

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 16

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 18

Hand Sanitizers Hand Wash Cleaners-Floor Branded Packaged Chyavanprash Turmeric

HAND SANITIZER PACKAGED RICE

Smaller players jump in to exploit the demand surge

Jan-20 Feb-20 Mar-20 Jan-20 Feb-20 Mar-20

152 New Players in Hand

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2

Use of Whatsapp for product ordering

57% Corporate Leaders Talk

Companies partnering with delivery

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 22

Copyright © 20120 The Nielsen Company. Confidential and proprietary. 23

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 24

EMPHASIZE QUALITY AND BE TRANSPARENT ABOUT LEVERAGE

A clear communication from 1. By meeting changing consumer

Nielsen COVID-19 Impact on FMCG and Retail: Edition 2 26

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