MUMBAI, May 17: The total consumer promotions market in India is valued at Rs 154.43 crore, which is a mere 2.4 per cent of the total spend of Rs 6,301.64 crore. While the worldover the ratio of above-the-line spending to below-the-line spending has now stabilised at a 30:70 level, the Indian market exhibits a near reverse scenario. However `more for less' is a mantra which will increasingly be practiced by marketers in the subcontinent, as the pressure on shelf-space increases; retailers will have increasing bargaining power; and media will get more complex-suggests a recent study of consumer promotions conducted by research agency ORG-Marg.An extension of its retail audit operations wherein the agency monitors 100 FMCG categories on a regular basis from a panel of retailers, the study's findings relate to the promotions audit conducted between November 1998 to January 1999.
Among a host of findings, the survey reveals: the quantum of promotion-led market sales is the highest in the case of HindustanLever Limited with Rs 31.97 crore worth of its sales coming from the promotions market. Colgate Palmolive follows at number two with Rs 11.15 crore worth of promotion-aided sales while in the case of Nestle India the figure is Rs 10.74 crore, according to the study. Interestingly, the companies that stand out with respect to the ratio of promotion contribution to total revenue are smaller players like Vicco Labs (33.4 per cent), JB Marketing (18.2 per cent) and Balsara Hygiene (15.3 per cent).
The ratio of promotion to revenue in case of companies like Nirma Chemicals, Britannia Industries, Cadbury's and Procter and Gamble is less than one per cent indicating that the players have not resorted to promotions in as significant a way, says the survey.
The survey lists Colgate Dental Cream and Rin Supreme as the leading brands amongst the top five, ranked on the basis of the quantum of promotion-induced sales of their respective packs. Sales in case of brands like Vicco Vanishing Cream and Complan Chocolateregister a substantial contribution of promotion sales: a whopping 34.84 per cent of total sales in case of the former and 19.18 per cent of total sales in case of the latter.
So far as the top ten product categories are concerned, skin-creams top the list with 9.1 per cent of the total sales or Rs 22.06 crore coming from promotion-aided sales. Toothpastes and beverages follow with Rs 15.37 crore and Rs 11.49 crore of sales coming from the promotion market, respectively-which is close to 5.4 per cent and 6.6 per cent of their respective total sales.
However coffee and chyavanprash are nearly equal in terms of the highest contribution of promotion sales to the total category sales, with 9.7 per cent and 9.6 per cent of the total sales respectively, coming from the promotions market.
Further, the survey reveals that companies have been concentrating on larger towns with consumer promotion offers. The towns with population more than five lakh account for nearly half of the total promotions market.Finally an indication of the impact of consumer promotions. During the survey period, the promotion offtake for Complan Chocolate was over 17.39 per cent of the total off-take while the same in case of Vicco Turmeric was as high as 44.73 per cent.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.