New Delhi, January 27, 2022: The fast-moving consumer goods (FMCG) industry is undergoing a significant transformation over the last few years. The boom of e-commerce, active participation of developing countries, and rise in urbanization coupled with rise in the standard of living are a few factors that contribute to the growth of the FMCG market.
According to Allied Market Research, the global FMCG market is expected to reach $15.36 by 2025, growing at a CAGR of 5.4% from 2018 to 2025. Increase in urbanization, rise in disposable income, and prevailing opportunities in the FMCG industry drive the market growth.
There are some major trends in the FMCG industry that highlight growth factors of the industry including demand for sustainability in packaging and development of the product, digitalization, and focus on improving customer experience. In addition, the advancements in technologies such as the Internet of Things (IoT), artificial intelligence (AI), and 3D printing have enabled FMCG companies to focus on the sophisticated distribution of goods and improve customer experience.
· Sustainability
Today’s customers are more concerned about climate changes and focus on their participation in reducing their carbon footprint. Thus, several FMCG companies have made some responsible choices while developing a new product. Companies have not only focused on how to present and package their products but are also keen on deciding what materials they use in their products. As customers pay more attention to the company’s social activities and are willing to pay extra for sustainable products. Some FMCG companies have launched recyclable, reusable, and compostable packaging and included cruelty-free and vegan ingredients in their food, which has taken the cosmetics industry by storm.
· Customer experience
The demand for convenience or packaged food has increased in the FMCG sector and companies are keen on bridging the gap between the customer demand and supply of convenience food. What’s more, some companies have invested big bucks in augmented reality (AR) and virtual reality (VR) to make their products more interactive and engaging. Moreover, the advent of 3D videos and gamification have entered the FMCG industry to attract tech-savvy customers while offering them more information about the product.
· Digitization
Digitalization has gained traction in almost every sector across the globe and the FMCG companies are not far behind from getting on board with the trend. With the use of digitalization, companies can interact with brands across offline and online channels and gain access to informative data from several social media platforms. Moreover, the launch of web and mobile applications increases customer engagement directly and helps convert one-time buyers into repeat customers.
· Advent of e-commerce
E-commerce is booming across the globe. The global acceptance of online shopping portals and shift of customers’ habits toward online channels have encouraged FMCG companies to focus on e-commerce for improving user engagement. The Covid-19 pandemic has further helped to shift customers’ shopping habits and boosted the demand for e-commerce, even in developing countries. E-commerce sites along with social media platforms create a perfect storm for FMCG companies to improve their digital presence. FMCG start-ups have actively participated in several social platforms to improve customer engagement.
· Data analytics
The advent of big data and analytics has had a huge influence on the FMCG industry. These cutting-edge technologies offer new tools to compete in the industry. As the data has become more and more accessible due to rise in online shopping, FMCG companies can find new ways to promote their products and build a relationship with their consumers based on past purchasing choices and shopping patterns. The data analytics helps explore customer preferences and behavior and offers FMCG companies a deep understanding of their consumer bases. Moreover, big data solutions enable brands to optimize communication with their customers and help create more personalized experiences for their customers.
· Artificial intelligence
AI-powered solutions including machine learning (ML) and natural language processing (NLP) have proven to be helpful in the FMCG industry. The voice-based systems help customers to find products and serve customers. Moreover, AI can help in providing personalized product suggestions. AI-based solutions offer FMCG companies a new way to improve customer experience and boost customer satisfaction and retention.
· Internet of things
IoT is no longer limited to switching on/off a few buttons remotely. As the technology evolves, it has found application in the FMCG sectors. The IoT-based devices are affordable, highly scalable, and automated, which helps FMCG companies to employ them in brick & mortar stores, manufacturing facilities, and warehouses. These devices can help in inventory management. Apart from this, these devices can offer targeted messages to customers while they are shopping. The combination of IoT devices and smart objects can create new opportunities in developing customer interaction channels for FMCG brands.
Apart from these trends, blockchain, advanced analytics, and digital marketing will become more prominent to improve supply chain and customer engagement in the future. Identifying new opportunities and leveraging advanced technologies are vital for any FMCG company and implementing new strategies to gain a competitive advantage.
Corporate Comm India (CCI Newswire)
