Top brands grow faster riding trust amid Covid

Top three brands across home, food and personal care categories have been growing twice as fast as the rest of the product segment, indicating a rising preference for market leader or trusted brands amid the pandemic, a recent study has revealed.For instance, the top three brands in categories such as soaps, tea, malted food drinks, edible oils and biscuits have all grown 13-15% during the year ended May while other brands in these categories grew between 4-9%, according to a study by market research firm Kantar.This is a sharp reversal from pre-Covid times when smaller, especially regional, brands had been recording higher growth although on a smaller base and gaining market share at the cost of larger brands.85192573Industry experts attributed this to people’s tendency to opt for trusted brands amid a crisis such as Covid-19 as well as higher visibility of bigger brands when many smaller brands may have been forced to slash their advertising and marketing budgets.“I think what really happens is that people migrate towards trusted brands, and that's why we saw a resurgence, and similarly maybe Parle saw a similar kind of resurgence,” Varun Berry, managing director of biscuits maker Britannia, had told investors last week.Kantar said the nearly two times growth difference wasn’t so widespread before the pandemic. In fact, categories such as bar soaps, utensil cleaners, and washing powders had smaller brands outpacing big brands over the past few years, it said.“Experimentation in each category, and the number of brands consumers add to their basket has come down,” said K Ramakrishnan, managing director, South Asia, Kantar Worldpanel Division. “That’s really good news for larger penetrated brands, which enjoy high loyalty and are purchased more often than the smaller brands.”While there is a dominance of market leaders, not all brands in the top have guaranteed growth. For instance, top soap brand Lux had a slow year as two hygiene brands, Lifebuoy and Dettol dominated. But, as a collective force, the top brands ended up with higher growth, Kantar said.Big companies have been aggressive in trying to ensure their top brands reached consumers across the country amid the pandemic-induced lockdowns and restrictions. While top FMCG companies had been increasing direct distribution over the past few years, in 2020 they added 10 distributors on average every day in an effort to reach consumers directly through their own dealers.

from Economic Times https://ift.tt/2VHBhXE