To boost volume growth, Parle Agro, ITC Foods, Mother Dairy, and Rasna placed a wager on low-unit packs. In order to boost consumption and volume growth, fast-moving consumer goods (FMCG) companies that sell juices, fizz drinks, ice creams, and milk-based beverages—such as Parle Agro, ITC Foods, Mother Dairy, Coca-Cola, and Rasna—have increased production and stock levels of low-unit packs (between Rs 5 and Rs 10). Following a lackluster 2023 marked by a sluggish summer season, the companies anticipate strong demand and at least 25% year-over-year revenue growth this summer.
“We expect the demand towards our dairy products to strengthen by 25-30% over the last season’s demand,” Manish Bandlish, MD, Mother Dairy (fruit and vegetable) told FE. Mother Dairy’s smaller SKUs start at a convenient price point of Rs 10 and include ice cream, curd and fresh milk. “We see smaller SKUs (stock keeping units) as a proven strategy to resonate with consumers who prioritise value, quantity and quality produce, especially during the summer season. The strategy not only helps in enhancing penetration but also expanding markets,” said Bandlish.
Ravin Saluja, director of Sterling Agro (Nova Dairy), highlighted the impact of low unit price packs in stimulating impulse purchases, thereby enhancing overall sales and consumption, especially during peak seasons like summer. Saluja anticipates a notable rise in sales volumes of smaller SKUs, projecting a growth rate of 25-30%. Additionally, he expects a corresponding increase in sales of fresh dairy products, driven by consumer preference for convenient and value-oriented options.
He predicted that customer tastes will move toward cool dairy products like dahi, lassi, and chach. He also stated that although sales of high-fat goods could somewhat fall, there will be a noticeable increase in demand for fresh dairy products because of the rising temperatures.
A PepsiCo India representative bet on the company’s intense summer advertisements, which feature the comeback of the beloved “Yeh Dil Maange More.” The spokesman stated that “it is the most favourable season” for the company’s brands, which include Tropicana, Gatorade, Pepsi, 7up, Mirinda, Mountain Dew, Sting, Slice, and Nimbooz. For its part, Coca-Cola India is increasing production and using a segmented strategy while continuing to pay attention to customer preferences and market conditions.
ITC Foods’ dairy and beverage division has increased production and distribution in front of the season with its ambient range, which includes smoothies, natural juices, coconut water, and a distinct dairy portfolio.
The company has extended its reach in the rural markets of UP, Andhra Pradesh, and Rajasthan, among others. Its 125ml fruit drinks (under the B Natural) SKUs, which are priced at Rs 10, are aimed at rural geographies with a population of 5,000 or 10,000. One-third of ITC Foods’ more than 1.5 million locations carry these items, and the business plans to open additional locations for its fresh dairy products.