FMCG, Appliance Makers Weather Climate Change Pangs With All-Season Offerings
FMCG giants, including Dabur India and Emami, are innovating their product portfolios to counter the impact of shifting weather, ensuring steady sales across seasons.
Irregular weather patterns owing to climate change are pushing fast-moving consumer goods and durables firms to change their marketing. Companies are selling fewer winter or summer products and are adopting an "all-season" approach.
Companies from Dabur India Ltd. and Emami Ltd. to Blue Star Ltd. and Voltas Ltd. have all embraced the pan-season sales tactic. They are launching new products, integrating new features into existing ones, and trying out new advertising campaigns to drive sales.
"This year, we saw a delayed winter, a slightly delayed monsoon, and even a harsh summer. All of this had an impact on seasonal products for FMCG companies," Kaustubh Pawaskar of Sharekhan by BNP Paribas told NDTV Profit in a telephonic conversation.
"In order to reduce the impact of these erratic weather patterns, companies are innovating their product portfolios such that they can do well throughout the year," Pawaskar said.
Nobody would like to have a seasonal kind of business in their portfolio, especially in the current market environment.Kaustubh Pawaskar - DVP Fundamental Research, Sharekhan By BNP Paribas
The Winter Appeal Of ACs
On the durables front, Blue Star told analysts during the September quarter earnings call that the room air conditioning segment is doing "exceptionally well," even after the summer season. B Thiagarajan, the company's managing director, expressed surprise at the time, "FMCG has slowed down; even some other durables have slowed down, but air conditioners [division] alone are growing."
Girish Hingorani, the company's cooling and purification appliances division's Vice President - Marketing, offered some insight into this.
Elaborating on the winter sales pitch, he told NDTV Profit how the company's "ACs are designed to effectively filter out harmful microbes, allergens, and particulate matter from the air."
Our ACs can also function as air purifiers, particularly during the winter months when outdoor air quality is a concern, especially in North India.Girish Hingorani, Vice President - Marketing (Cooling & Purification Appliances), Blue Star
Pradeep Bakshi, Voltas' CEO and managing director, also explained a similar AC-is-an-air-purifier strategy to drive all-season sales.
He added that the company's ACs see steady demand in India's southern states thanks to a brand campaign that emphasises an all-weather line of cooling products. On the back of this, Voltas launched "an all-weather AC brand campaign in north India in December," Bakshi told NDTV Profit.
Chyawanprash For All Seasons
Emami too has taken an all-season approach with their seasonal products. BoroPlus lotion is a winter mainstay in many Indian households. The company has now come out with soaps, aloe vera gel, and prickly heat powder under the BoroPlus brand.
This is on top of its existing prickly heat powder offering under Dermicool. Emami has now launched two new products under the Dermicool brand as well, Vice Chairman Mohan Goenka said.
Personal care giant Dabur had also announced a monsoon advertising campaign earlier this year, promoting its most famous ayurvedic product, Chyawanprash, for all-season consumption.
"Chyawanprash has a perception that it's good only in winters. So to demystify that... we did the monsoon campaign, which gave us great dividends," Chief Executive Officer Mohit Malhotra said. He added that the monsoon campaign had resulted in secondary growth of 12.6% for the product.
Sharekhan's Pawaskar, though, said that it might be too soon to quantify such gains. "A new product or strategy does not have a one- or two-year story, but rather one that depends on it being established in the market."
A Tepid Year-End?
NielsenIQ said that the FMCG sector grew 5.7% by value between July and September, with rural and urban consumption rising 6% and 2.8%, respectively. But as weak demand and rising costs persist, the industry may end the year on a choppy note, with little optimism for 2025.
Recently, Godrej Consumer Products Ltd. too flagged the continued slowdown in demand, which could affect its performance in the October-December quarter.
While the slowdown persists, Pawaskar expects the pivot toward a larger all-season product mix to continue in the coming years across the industry. But profitability might vary from company to company, depending on various factors like advertisement spends and commodity price momentum, he said.
"But obviously, the revenue should be consistent with the strategy, and there should be consistent growth with that," Pawaskar added.
