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demand spotting in an uncommon India
India’s Emerging Demand Story
Under the Scanner
Ranjeet Laungani, Vice President, Nielsen
THE INDIAN GROWTH STORY: SIZZLE OR FIZZLE?
$35bn↗$208bn FDI INFLOWS (FY 2000-2006 TO FY 2006-2012)
13.3mn↗60.6mn MIDDLE CLASS HOUSEHOLDS (2005 TO 2015)
8,481↗18,578 BOMBAY STOCK EXCHANGE SENSEX (2009 TO 2012)
THE INDIAN GROWTH STORY: SIZZLE OR FIZZLE?
19%↘16% FMCG VALUE GROWTH (2010 TO MAT AUG 2012)
9.3%↘5.5% GROWTH IN GDP (Q2 2010 TO Q2 2012)
26%↘12% YOY AUTO SECTOR GROWTH: NUMBER OF VEHICLES
(2010-11 TO 2011-12)
GLOBAL PERSPECTIVE ON DEMAND AND
CONSUMPTION
CHANGING FACE OF DEMAND IN
INDIA
GLIMPSE THE FUTURE OF TAPPING
LATENT DEMAND
INDIA IS YET TO EMERGE AS A HIGH CONSUMPTION MARKET
FMCG CONSUMPTION PER CAPITA ACROSS EMERGING PEERS
FMCG CONSUMPTION AS A % SHARE OF GDP
Philippines 7.5 Thailand 4.6 Nigeria 4.6 China 2.9 Indonesia 2.4 India 2.2
World Bank 2010; Nielsen 2011
Thailand $214 Philippines $161 China $128 Indonesia $72 Nigeria $59 India $31 UN 2010; Nielsen 2011
Urban
$65 Rural
$15
GLOBAL PERSPECTIVE ON DEMAND AND
CONSUMPTION
CHANGING FACE OF DEMAND IN
INDIA
GLIMPSE THE FUTURE OF TAPPING
LATENT DEMAND
CHANNEL LINES ARE BLURRING
Modern Retail
Paan Plus
General/ Grocer
Chemist
Baby Foods ↗106% Packaged Tea ↗ 36%
Contraceptives ↗ 129% Diapers ↗ 65%
DEMAND AT THE TOP AND BOTTOM OF THE PYRAMID
FY03 FY10 Small 82% 78% Midsize 17% 18% High end 1% 4%
Source: ICRA and SIAM; High end = Executive, Premium, Luxury
AUTO MARKET SHARES BY SEGMENT
FMCG VALUE GROWTH BY SEGMENT
Low Unit Packs 23% Small Packs 21% All Urban India 19%
Source: Nielsen; Urban FMCG; 2 Year CAGR (Value Growths)
DEMAND IS PERMEATING
Small Towns 18.7% All India 17.0% Villages 16.1% Metros 15.9% Source: Nielsen; Period Ended August 2012; Small Towns = <1 million population
FMCG VALUE GROWTH (2-YEAR CAGR)
WHAT ARE THE RIGHT MARKERS TO FOLLOW WHEN GDP GROWTH IS NOT VERY PREDICTIVE OF SHORT-TERM DEMAND?
Top
10
sta
tes:
hig
hes
t G
DP
Gro
wth
Bih
State FMCG Growth
MP
Del
Chg
Guj
Jhd
Ukd
Mah
Ker
2011 All-India Average (15% FMCG Growth, 6.5% GDP Growth)
Har
GLOBAL PERSPECTIVE ON DEMAND AND
CONSUMPTION
CHANGING FACE OF DEMAND IN
INDIA
GLIMPSE THE FUTURE OF TAPPING
LATENT DEMAND
Future Demand
TRENDS SHAPING DEMAND IN THE NEAR TERM
NUTRITION & WELLNESS
PERSONAL CONSUMPTION MINDSET
PARTAKING IN GLOBAL BRAND CULTURE
TIME SAVING/ ON THE GO
PREMIUMIZATION & LIFESTYLE UPGRADE
DIGITIZATION
IS TOMORROW ALREADY HERE?
GEO FENCING IN MALLS FOR CONSUMER OFFERS
INTERNET-READY ‘CONNECTED’ TELEVISIONS
PRODUCT LAUNCHES ON SOCIAL MEDIA SITES