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A brand is the image or idea of a particular service or product, that consumers unite with, by identifying the design, name, logo or slogan of the company who owns the image or idea.
Some of the definitions of brands are:
According to Ambler (2003) a brand can be defined as a design, name or symbol that identifies one or more than one product and it is something that is bought by the consumers.
According to Leiser (2004), is set of hope and relations evoked from experience with a product or company. Furthermore, it is all about how consumers feel and think about what the product or company can deliver across the board.
The brand which has the maximum percentage sales in a particular product area is known as leading brand. The leading brands enjoy a good market share, and there is always a consumer perception that the leading brands provide best products.
Products which have a speedy turnover and comparatively low cost are known as FMCG (Fast Moving Consumer Goods) and such products normally get replaced within a year. Examples of FMCG include frequently purchased consumer products such as soap, tooth cleaning products, cosmetics, detergents and shaving products, as well as other nondurables such as chocolate bars, glassware, tissue paper, bulbs, soft drinks, batteries, packaged food products, paper products, pharmaceuticals and consumer electronics.India is a big market for Fast Moving Consumer Goods companies. A more than 100 crore person of India depends on FMCG companies for their daily basis. It is the best country for the big players. Here, is the list of top 10 leading FMCG companies in India.
Top 10 FMCG Companies In India:
1.HUL (Hindustan Unilever Ltd.)
2.Indian Tobacco Company (ITC)
9.Procter & Gamble Hygiene and Health Care
The Indian FMCG (Fast Moving Consumer Goods) sector has a market size of US$13.1 billion and is the 4th largest in the economy. Well-established distribution networks, as well as strong competition between the unorganized and organized segment are the features of this sector. FMCG in India has a strong and competitive multinational company’s presence across the entire value chain. It has been estimated that the fast moving consumer goods (FMCG) market will reach to US$ 33.4 billion in 2015 from US $ billion 11.6 in 2003. In the Indian population, the most promising market for FMCG is the rural segments and the middle class. Most of products like shampoos, jam, skin care, toothpaste, etc. have low penetration level as well as low per capita consumption in India, but the potential for growth is vast.
According to Haresh B. Vaishnani (2011), Similar to store image, brand name is also an important relative variable that affects consumer’s reaction to price and its discount. A leading brand name conveys high quality and high image perceptions. Lot of researches on the price-quality relationship have found that brand name is a significant moderating variable that helps stabilize or control the quality perceptions of a branded product even when its price is decreased.
E.g.: There are leading brands which had to drop off the products because they were not one of the best products for example Britannia had to discontinue some products like
Swiss Rolls, Half Half Cakes, Glucose – D, Milk man Milk, Chutney Bread, Zip Sip Flavored MilkChai Biskut, Chekkers, Snax, Thin Arrow root or Jacob Thin and Cheezelets.
According to S. Ramesh Kumar (n.d.) consumers connect not with products but with best brands. They form powerful relation with brands; sometimes they just buy the brand product irrespective of the quality just because it is familiar to them. He has emphasized more on advertising, innovation and varieties for a leading brand to stay competitive than improving the quality.
This research aims to study the importance of requirement of the best product launched by a leading brand. The area of research will be the FMCG sector in India. Here, we will also analyze impacts of best products and non-best product of FMCG leading brands on the Indian consumers brand loyalty aspect. Companies spend a large percentage of their funds on their brand image and try to establish to be the leading brand, but I am keen to know whether the company takes in mind the quality aspect of the product or just launches it with the perception that it would work due to brand image.
A literature review provides information on a specific type of survey and focuses on assessing the existing published literature on a particular topic. It is generally the initial step that is done for an original research or a scientific; this part of the study presents the analysis, outline of the research, assessment of the various sources, group of sources and the whole body of literature. In this research report, focus is been given to analyze the importance of a brand image of the FMCG products of India. In the literature review, aim is being towards the assessment of an image of a brand of a particular good or service in the market and how customers unite with it by analyzing the design, slogan, and sign of the company.
Every goods and services are associated with a particular brand, and the brand carries with itself an image that motivates the customers while making a purchase decision. Brand contains a term, symbol, design or many more features, which identifies goods of one company from others. Brand image builds up and transmits the characteristic of a product in an exclusive manner diverse from the image of its competitors. An image of a brand contains various organizations in a customer’s mind, beliefs and attributes, it is the practical and psychological association with the brand of the customers. The image of any brand is not created but is gradually and automatically formed, it includes a products demand, easiness to use, functions, recognition and the overall worth of the product (Porter, 1998). Whenever any customer purchases any product they also buys the image of the particular product and a positive image improves the kindness and brand value of the organization.
FMCG sector in India
The Fast moving consumer goods sector of India is the fourth largest sector of the economy and is poised for future growth due to emerging prospects and strong fundamentals that is developing in the nation. The total market size of this sector in India is of 1,300 billion and has an annual growth rate of 11% per annum since the last decade. The FMCG sector of India has grown at a very fast rate and has in general outperformed the rest of the industries of the nation and has become a significant contributor in the country’s GDP. Unlike, the developed market of India which is mainly conquered by some of the bigger players, the FMCG market is exceedingly fragmented and a substantial part of this market are unorganized and many of them are selling unbranded and lose products (Fernando, 2011). It has been estimated that the Indian market is comprised up of approximately 13 million retail stores out of which around 9 million are unorganized stores generally in India known as Kirana stores.
Indian FMCG sector is having a significant feature and could be listed as a strong presence of MNC, well organized network of distribution, massive competition between the organized and unorganized marketers and low operational cost. It is being said that India is having a competitive advantage in this sector because of easy availability of raw materials, low labor cost and existence across the value chain through marketing strategies. Compared to the average standards of the world the level of penetration and per capita expenditure in most of the products is very low in India that represents the idle market potential (Carroll and Buchholtz, 2008).
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Consumer satisfaction and FMCG sector of India
Customers play a significant role in the Indian FMCG sector as the price of these products are fixed depending mainly on the target customer segment. In the past few decades through better market penetration and economical products the FMCG sector has fascinated a large number of people in both the urban and rural market of India. The foremost attribute that is required for success in this sector is creativity and innovation; many of the major companies have achieved customer loyalty by offering innovative and quality products at a reasonable range. FMCG goods focuses a lot on building up of brand through various marketing activities and advertisements, in this context the brand management of the organization aims towards to build up the mindset of customers related to the goods and services that could lead towards a positive buying behavior (Hill and et al, 2007). Companies try to influence the consumers through sales promotional activities, packaging, strong communication methods, advertisement, display and looks of the product.
SWOT analysis of India’ FMCG sector
The main aim of the research section in the report is to present the theoretical statements that are keystone of the survey. This chapter represents the various techniques and strategy that are used during the process of research. This part of the report explains the techniques that are being used and presents the ultimate practical project of the research report. The approach in which the research is being carried out should be induced of in terms of the various philosophy, strategies and the research instruments that are being used in the attainment of a particular aim and objectives of the topic (Gibaldi, 2010).
Research methodology explains the different possibilities and limitations of the research and it positions the survey carried out with the existing research and traditional information system. This section especially aims towards accumulation of data with a specific reason. The assembled data could be for a practical or theoretical research reports. The ultimate objective of this section is to evaluate the basic facts and figures that has not been discovered till date and finds out the appropriate solutions for the research topic with the help of a systematic process of application (Babbie, 2010). Research methodology in any of the report is defined as the foremost important part of the report that is based on all the methodical results and aids in evaluating information about the current of the external market, analysis of competitors and knowledge about the target customers.
Research Aims and Objectives
The main aim of the study is to evaluate the importance of requirement of the best product launched by a leading brand in the Indian FMCG sector. The area of research will be the FMCG market of India. In this study the researcher will also analyze the significance of best products and non-best products of leading FMCG brands on the Indian customers brand loyalty aspects (Jackson, 2008). In context of the study the objectives of the research are as follows:
Research Philosophy and Approach
Research philosophy provides knowledge regarding the various methods, in which the data for a research should be assembled, examined and utilized; the philosophical hypothesis in any of the research project is developed form the interpretive practice. In order to maintain the methodology process it is very much important to evaluate the pattern of survey with a suitable research philosophy (Gibaldi, 2010). It is mainly of two types those are positivism and interpretivism. The positivism philosophy aims on facts, figures, develops theory and then assesses them, this method is generally appropriate for the survey of large samples. Interpretivism theory focuses on the meaning and develops several thoughts through induction from data and examines smaller samples within the specified period of time (Babbie, 2010).
Data analysis is a technique that includes interpretation; evaluation and reviewing of data to obtain meaningful result from the accumulated information’s. Assessment of data is useful in entirely all the lively sectors of an economy and areas of academic research. This is due to decisions are ultimately taken from the collected data that should be presented and analyzed in an informative manner (Hair and Anderson, 2010). Analysis of data mainly involves three main steps. Firstly, it is the interpretation in which explanation of results from the research conducted through secondary methods that is mostly defined with the help of graphs, models, diagrams and models. Second point involves, the Discussion i.e. results accumulated is being discussed and then contemporary literature is being used to support the derived findings. In case if the research was hypothetical then it needs to be tested and results are being weighed with works of other researchers. Finally, it includes the critical analysis of data i.e. having an evaluation of sub topics that will reflect on assumptions made, qualitative description and statement of various predications (Gelman and Hill, 2006).
Thematic analysis is a practice that is being performed in a qualitative research that includes survey of data to evaluate any constant pattern. It is an association of related category data transmitting similar insights and mainly appears through inductive assessment process that explains the qualitative pattern. It can be done with the help of following below mentioned steps.
Theme 1 – Consumers prefers to do fortnight shopping
While undertaking this research, it was analyzed that customers usually prefer to buy products from FMCG stores in between 15 to 20 days. Moreover, these stores required to fulfill expectations of their clients, in order to keep them for long period. This is due to; there are lots of companies available in India, who attempts to offer high quality products, in order to attract more buyers.
Theme 2 – P&G and HUL are most liked brands
In the investigation, it was found that most of the people in India, likes to buy their daily utility products from two main companies, such as Hindustan Unilever Limited and Procter & Gamble Hygiene and Health Care. It is because these organizations pay concentration on health of customers. While creating product, the company send sample to the laboratory for testing its quality. This process is undertaken for two to three times, in order to ensure more excellence to the produced item.
Theme 3 – People prefers brand for quality
At the time of collecting data’s about customers perceptions regarding brands, it was found that people are more attracted towards branded items. Brand contains symbol or logo on its products, which provide support to buyer in recognizing their needed items. Many of times it is found that, competitors make copy of the company’s products and sell it into the market by manipulating the buyers. In this case, if client knows about trademark of their liked organization then the rival firm wouldn’t be able to cheat them easily. In the earlier times, Indians were not attached with the brands, but now it could be seen that everyone go for the purchase of branded items, either for daily utility products or luxurious items. This is because of increase in level of income of the buyers as well as enhancement of education (Quality Assurance and Quality Control, n.d).
Theme 4 – Mainly quality contributes in purchase decision
The results of collected data reveal that, customers get their money value through quality products. More money could be paid by buyers for superior items. While spending money, a customer expects high return from that, which can be provided by trademark products. Particularly in case of food items, safety and hygiene is very important. Lesser known companies usually not get their output tested or checked by food and safety agencies. Due to this, buyers feel more comfortable as well as secure in buying quality products of familiar brands. Trademark items give assurance about their excellence along with cleanliness, so helps client while selecting specific product from many available.
Theme 5 – People mostly prefers Nestle, HUL, Asian Paints, Britannia and Cadbury brands
While conducting the above research, it was originated that there are five top brands, from where most of the Indian population purchases their daily utility products. These brands are famous and liked by everyone, as they focus on the needs as well as demands of buyers. Customers are more attracted to such companies, who fulfill their expectations and attempts to give more possible satisfaction. People believe in buying from the organization where they get value for their money. In today’s period of low income and high earnings, everyone wishes to purchase products or services at reasonable price along with all required features.
FMCG is the fourth largest sector of Indian economy, which adds to increase the wealth of the nation. This sector includes those products that are useful in individual’s daily life. In the market of India there are many players present and they all putting their best efforts in capturing large market share including both rural and urban area. Customers of today’s era are very sensitive for product hygiene and quality. Therefore, they don’t easily purchase goods from unknown firms, rather do their shopping’s from recognizable or known brands. While conducting research, it is analyzed that buyers ready to buy things of high prices from famous brands. Moreover, for showing their differences or uniqueness from others, they purchase products from luxurious brands. This is due to it creates their standard as well as value in front of their friends or relatives (FMCG Sector, 2006).
The concept of brand is increasing importance in the India’s market place, because of spread of education plus awareness in the individuals. They become more conscious about health and safety of their families. Due to this reason, nobody is ready to purchase poor quality products from small firms, which also not have any adequate trade mark. In this relation various multinational retail sector has established their units in Indian market. Most common ones are Nestle, HUL, Cadbury, Britannia, Amul, Asian Paints, P&G, ITC, etc. These brands have gained their position in the market place through providing assured quality or value in their produces. The market situation of these brands is properly defined in the Literature Review section of this report (Dowling, 2002). The review part is also telling about thoughts and sayings of different authors on operations of FMCG. It is given in this part that mostly FMCG products are purchase by women and also purchase decision for daily utility products are made by females for their family. Thus, it is needed for companies to attract minds of female for their products. FMCG products are not purchase at one time; rather it is regularly purchased in 15 to 20 days. Due to this reason, customers generally select one specific brand and make their purchases from there on continuous basis. This selection is done on the basis of trust or belief creates by brands on the clients. Moreover, brands are varied according to their functions as well as operations in the market place. The customers prefers to buy from such branded firms, which offers appropriate functions in relation to packaging, distribution, guarantee certificate, etc. Similarly, value is added by brands in their products through adding extra features in their products. These features are added according to the needs and desires of customers as well as their demands in the market. Furthermore, the brand that successfully fulfills the perception level of buyers gets huge market share (Kohlmann and Moock, n.d).
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It is not only that brands are just required to manufacture products and developing their logo or symbol for brand recognition. In order to aware buyers about their availability, they also required to incur huge cost on advertisement. The message which will be given through local media should be as much effective to attract minds of more customers. Customer relationship management is also needed to be conducted by companies, for the reason to make promotion of their brands products. Moreover, the particular brand gains their recognition in the market place by way of adequate advertisement. In addition to this, organizations can able to tell about their products features, price, quantity, quality, etc. through advertisement, this makes customers to buy items easily. In the investigation it is determined that FMCG sector is expected to be grow in Indian market in coming years, due to strong fundamentals, which is developing the country and emerging prospects. With an effect of liberalization policy of Indian government on foreign direct investment, various FMCG companies have come to the nation and contribute in GDP (Dowling, 2002). The companies also increase the living standard of rural population, as good employment opportunities are given by such firms.
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