Seed marketing of fast moving consumer goods

The market of fast moving consumer goods (FMCG) is highly competitive. The trend of market is on a roller coaster ride, one day it is showing constant up and another day it is ready to touch deep down level. It is really tough for the manufacturers to remain in the main stream without facing much loss. It is not just a trend of market and effect of international market that affects the future of companies but rising level of competition is making it really tough for the market players to remain in main stream.

What is FMCG?

Fast moving consumer good or consumer packaged goods are products that are sold quickly and the price is not too high like durable goods. Perishable items like meat, dairy products and products with high turnover rate like beer, pre-packaged food, cleaning products, toiletries also comes under FMCG category. FMCG products have a short shelf life.

The main features of FMCG products are:

Frequent purchase unlike consumer durables FMCG are purchased frequently

Low in price: with the increasing competition now FMCG manufacturers are coming with special deals and pricing

FMCG play a significant role in stock turnover

It requires extensive distribution network: product of FMCG are required by all sections of society irrespective of geographical differences and it is one of the biggest challenge of the FMCG companies to reach more and more number of people as it is the only way to expand the market and increase sales.

Earlier there were few brands and advertisement and promotional activity were not so vigorous, people just recall FMCG product by the brand name and purchase it but with the growing trend of retail marketing and tough marketing techniques now several new names are emerging in the field of FMCG. Success in FMCG business is mainly decided by distribution network and this can be achieved by proper advertisement and promotional activity.

Success in FMCG is not just a game of a day. Seed marketing largely decide the future of FMCG manufacturer in the long run.  As the name suggests seed marketing will not bring results in a day or two but it help manufacturer in establishing their name in the market and enjoy the fruit of success after some time. Seed marketing provide FMCG manufacturer’s to mark out the fertile area from sales point of view and implement  a marketing strategy seeking long-term goal. The scope of seed marketing is wide and it concentrates on larger area. Seed marketing is largely designed keeping in mind the long term objectives of the company.  Products like toothpaste, cold drink, chocolates, soap and washing powder are trying hard to connect to their consumer class using advertisement, seed marketing help FMCG to make a hold over consumer class.

FMCG sector is going through a boon phase in India.  The changing trend of society, more number of young people and availability of resources has made the place more conducive to the growth of FMCG sector. It is estimated that current Indian retail market value US$590 billion with the growth rate of 13% per annum.  With the increasing dominance of organized retail marketing and growing number of supermarket and hyper mall the share of organized retail is expected to increase from 4 to 5% to 14 to 18% by 2015. FMCG’s are generating higher revenues and with the exploration of rural market this area is expected to grow more in coming decades.

FMCG companies are now concentrating more on the rural market as this sector still has lots of potential yet to be explored. Many branded FMCG’s have started their rural market campaign and they are selling products suitable for lower income group. Food products and lifestyle products are high in demand in rural areas as well as in leading cities. FMCG giants like Nestle, Hindustan Unilever, P&G and TATA have launched value pack of all popular products, either they are selling items with scheme or have introduced small packet at low cost to remain in the touch of lower section of society.

Success in FMCG sector is largely determined by marketing strategy, here seed marketing plays a crucial role in the future of companies it helps manufacturers in creating a ground for future business  and help in exploring untamed facets of marketing  and help in exploring untamed facets of marketing.

Seed marketing are tried out by large companies and have to with draw the FMCG product altogether if there is a poor response from the market. Smaller companies should not attempt seed marketing.