In an increasing war for shelf space, FMCG marketers in India are considering out-of-the-box packaging solutions to attract customers and to differentiate their products
Fast-moving consumer goods (FMCG) manufacturers in India are trying to innovate their product packaging in order to make their products stand out from the increasingly competitive and cluttered modern retail shelf space. For this, Indian FMCG marketers are now taking a cue from their global counterparts.
According to a research report 'Innovations in Packaging—Emerging Opportunities in the Indian Food Industry' by Datamonitor, there will be a multi-dimensional shift in food packaging in India over the next five years. The report predicts that advanced packaging techniques and concepts such as aseptic packaging and retortable packages—although coming into existence—are yet to make a mark in India.
"With the consistent rise in the adoption of 'ready to eat/drink' products amongst Indian consumers, it is expected to be only a matter of time before (the) Indian FMCG market would be filled with products using advanced packaging technologies, primarily aimed at enhancing the shelf life of products and to offer additional convenience to the consumers in terms of storage, consumption and portioning,” said Pinaki Mukherjee, lead consumer consultant, Datamonitor.
“Riding on the rapid shift in consumer graphics and spectrum in India, food packaging emerged as the new value differentiator for the FMCG companies in India,” added Mr Mukherjee.
Food packaging across the globe has seen a continuous shift over the past 30 years and FMCG margins are declining due to price competition mixed with an increase in input costs.
Mr Mukherjee predicted that the role of packaging in food merchandising will undergo a lot of changes in the years to come. “India is seen somewhere at the middle of the evolution stage in terms of food packaging when compared with developed economies such as Japan, Germany and the US. The sophistication of packaging in India heavily varies across different food categories. Although Indian manufacturers have brought about a number of innovations in food packaging, such as sachets and micro-packaging, they have largely taken inspiration from the more developed Western economies to find out opportunities to differentiate their merchandise from competitors through packaging,” he said.
International brands have also increased their presence in the Indian market to cater to the increasing number of high-end users, which is intensifying the competition among domestic marketers.
In an era of changing tastes and preferences, consumers are looking for convenience of consumption and usage which has helped the packaged food industry replace local produce eatables.
"Traditionally, product packaging has not been seen as a vehicle to promote the brand but it is changing now. For example, Kissan Jams, targeted at the kids segment, is now using tube packages with catchy graphics to appeal to the target audience, Bru Coffee's aroma-lock packaging appeals to staunch coffee lovers, who are worried about retaining the aroma upon multiple usage from a single pack. In coming years, we could see many more such examples,” added Mr Mukherjee.
As the 'shelf war' among FMCG manufacturers is rapidly increasing at the modern retail chain, there has been a sharp hike in shelf space prices.
Across the globe, there are four key trends in packaging—convenience of usage, freshness & improved shelf life, sustainable and environment-friendly packaging—as a tool to position and promote a brand, the report said.