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Shampoo, Health drinks to drive FMCG: NCAER

03-January-2002
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Shampoo, Health drinks to drive FMCG: NCAER

According to the latest projections by the National Council of Applied Economic Research (NCAER), the deeper understanding of the Indian consumer and the ability to deliver quality products at low costs are what will impact the FMCG sector in the next five years. Apart from health beverages and packaged biscuits within foods that are expected to grow in the next five years, it's the shampoos that could exhibit a growth trend by 2006-07.

According to NCAER, in 1998-99, 140 households per thousand were consuming health beverages. In 2001-02, the number is expected to touch 175 households per thousand. And in 2006-07, 247 households per thousand are expected to consume health beverages.

According to NCAER, among personal care products, toilet soaps have reached saturation, there is immense potential for penetration of shampoos in Indian households. Shampoo penetration is expected to grow from 314 per thousand households in 1998-99, to 502 per thousand households in 2006-07. The penetration of washing powder is also expected to go up from 660 per thousand households in 1998-99, to 770 per thousand households in 2001-02.

Meanwhile, the rural consumer continues to have scant regard for brand loyalty. It is smaller pack sizes, functional products, value for money, reluctance to shift from one brand to another and zero brand consciousness that continue to call the shots here.

NCAER findings indicate that in 1998-99, the share of rural consumption among health beverages stood at 25.4 per cent and within packaged biscuits at 31.8 per cent. Among edible oils, rural consumption stood at 64.2 per cent, while toilet soaps consumption was a high 48.2 per cent. The consumption of washing powders among rural markets stood at 48.5 per cent in 1998-99, with shampoos recording a low 28.1 per cent share in 1998-99.

Within health beverages, higher penetration within rural markets will bring about the maximum change in market size, followed by income. Within packaged biscuits too, category penetration followed by income in rural markets will impact market size in a big way.

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