Managing organizational and Management challenges in India –

“A research on challenges faced by organizations due to changing

consumer landscape”

Ishwar B Kelwadkar
Kevin Jon
Team 1
 Presentation Plan
1 Introduction
2 Background of Research
3 Research Methodology
4 FMCG Sector & Challenges
5 Journey of FMCG sector in India
6 Growth Drivers for FMCG Sector
7 Strategies by Companies to face Challenges
8 Action Plan
9 Conclusion
10 Bibliography
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 Introduction
• India : A Land of Billion People
• 151 Languages spoken
• Economy - One of the Worlds fastest
• Disparity - 70% Population earn less than 1 dollar
• Division of Indian Consumers

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 Division of Indian Consumers

Climbers

Aspirants

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 Background of Research Area
• Survey Conducted by McKinsey
• Executives from 93 countries

Research Methodology
• Exploratory Research

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 FMCG Sector
• Immense Potential – FMCG market to reach 33.4 $
Billion by 2015
• Highly Fragmented FMCG market
• Growth Drivers
• Emerging Markets

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 Growth Drivers

Emergence
Increased
of
Disposable
Organized
Income
Retail

Distribution Favorable
Indian
Depth -
Economy &
Rural Demographic
Penetration s

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 Challenges for FMCG Sector
• Design and Manufacturing
Low Capital Intensity
Technology
Third-party Manufacturing

• Marketing and Distribution

High Initial Launch Cost
Limited Mass Media Options
Huge Distribution Network

• Competition
Significant Presence of
Unorganized Sector
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 Journey of FMCG Sector
“DROP” Stage
“RURAL
“LACKLUSTER”
LIBERLIZATION BOOM
SENSITIZATION”
and STABLIZATION”
– (2000
Stage
Stage
Stage -––1970’s
Pos – toto
1950’s
t Liberalization
1970’s
2005)
(1991
1990’s- 2000)

“
B
O
O
M
R
E
V
IS
T
E
D
”
St
ag
e:
20
05
on
w
ar
ds 12/07/2021 NCMS 2010 9
 Consumer class household Income Boom
Distribution
60 54

50
41
40 34

30 26
18
20 13
10 5 4 3
2
0
Very rich Consuming Climbers Aspirants Destitute
class
2009 2015
Source : HLL, NCAER
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Fig. 1 consumer class household Income Boom
 Strategies by FMCG Companies
I. Operational Challenge
II. Brand Dilution
III. Consumer Communication
IV. Research & Development
V. Distribution
VI. Backward Integration
VII. Acquisition
VIII. Focus on Core Business
IX. Shift in Business Portfolio
X. Focus on Low Income Consumers
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 I. Operational Challenges

P&G
– Market Development Organization

Nestle
– Channel & Category Sales Development
– National Key Accounts Management Organization

HUL
– Cost Reduction Strategy

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 II. Brand Dilution
Nestle
– Nestle Every Day Slim Tea Whitener
– Nestle Fresh & Natural Slim Dahi

III. Communication
Nestle
– Nutritional Compass

Nirma
-Umbrella Branding Strategy
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 IV. Research & Development
Nirma
– On Line Instruments
P&G
– Innovation Leader
HUL
– Pure It
V. Distribution
Nestle
– Nestle Consumption Zone
Nirma
- Nirma Consumer CareNCMS
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2010 14
 VI. Backward Integration
Nirma
– Manufacture Key raw
materials

VII. Acquisition
Nirma
- Global Presence

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 VIII. Focus on Core Business
P&G
- Billion Dollar Brands contributing
80 % of its Sales

IX. Shift in Business Portfolio

P&G
- Focus on Paper & Food business

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 X. Focus on Low Income Consumers
P&G
– 42 % of Sales Growth from Developing Market

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 Action Plan: Companies Entering
Indian Market

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 Consumer Indian market Consumer
preference • Consumer Communication
research preferences
R&D • Disposable income
• Shift in consumer
class distribution

Distribution
Channel

Fig. 2 Road map for companies to enter Indian market

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 Action Plan: Companies to Face
Challenges from Changing
Consumer Landscape

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 Operational
Efficiency

R&D Focus on core

Brand
business

Backward
Focus on Shift in
Integration
Low-income Business
consumers Portfolio

Merger &
Acquisitions

Fig. 2
12/07/2021 Action Plan for Companies
NCMS to face challenges from changing 21
2010
consumer landscape
 Conclusion

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 Bibliography
• 1
http://www.labnol.org/india/marketing-to-consumers-in-india/6354/
• 2
Organizational Challenges of global trends – A Mckinsey Global Survey
2007
• 3
Challenges before the Indian FMCG Sector & Designing a Blueprint for
Published on CoolAvenues.com | MBA Network of IIMs, ISB, Bajaj,
XLRI, FMS, SPJAIN (http://www.coolavenues.com)
• 4
Market Survey - By: Dr S. Maheskumar, The author is a lecturer in
commerce at Sengunthar Arts and Science College, Tiruchengode,
Namakkal.
• www.pg-india.com/
• www.hul.co.in/
• www.nestle.in/
• www.rb.com/
• www.nirma.co.in/
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 Thank You !

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