Fast Moving Consumer Goods (FMCG), or some call Consumer Packaged Goods (CPG). When people talk about FMCG, they think about the likes of P&G, Nestle, Unilever, Mondelez, Mars, Perfetti, Hershey’s… and many more other household names.
It’s an interesting industry. Having worked in the Investment/Financial, Oil & Gas and FMCG industries, FMCG is the fastest-paced industry that we’ve ever experienced. And we think this is partly because of the need to stay ahead and meet fast-changing consumer demands and investors’ high expectations (as they often assume that developing markets has an insatiable appetite for FMCG products!)
It is interesting to point out that most FMCG companies have a Category-Led Operating Model. What do I mean by ‘Category-Led’?
★ In P&G, they’ve Baby, Feminine and Family Care, Beauty, Hair and Personal Care, Fabric Care and Home Care, Health Care and Grooming categories.
★ In Unilever, they are organized by Personal Care, Home Care, Foods and Refreshments categories.
★ In Reckitt Benckiser, they’ve mainly Health, Hygiene and Home categories (disclaimer: they do have what they call Portfolio Brands and Foods categories which constitutes about 8% of their total turnover).
★ In Mondelez International, we’ve Chocolates, Biscuits, Gums & Candy and Powdered Beverage and Meals categories!
And the list goes on…
Category operating models are proven to work and deliver results. Category model provides the opportunity to grow global brands at a larger scale, create best in class cost management to drive margins and achieve operating excellence.
Ok – We know the above sounds like big words and fancy terms. So let us explain in a simpler way:
In the past, you may have a category (let’s use grooming category – Gillette shavers as a fictional example) registering strong sales growth in Japan and South Korea but not doing so well or virtually non-existence in China and Vietnam because of a strong local alternative competitor who has dominated the market share.
If you’ve shifted to a category-led operating model, a Category President is likely to look at the category from a regional pov in Asia. A Category President may have the ambition to grow the category outside Japan and South Korea by investing heavily to promote (or even launch from scratch if there was no presence) the grooming category and Gillette brand in China and Vietnam in an effort to expand the category footprint and market share.
The Category President can leverage best global marketing and brand equity practices, learn from how other regions have launched categories in new markets, and explore if there are ideas that they may steal with pride.
Did the above help clarify?
We love the FMCG industry because of a variety of reasons.
♥ Its fast pace nature means there’s never a boring day for you. You’ll be constantly required to look at change management, transformation, cross-functional projects and supporting the business to deliver top & bottom line QUICKLY. It is also an industry where we can relate to the products very instantly. These are products that have an impact on millions of home across the world.
♥ Even the way FMCG companies do business has changed. They are doing it more responsibly than before and putting in increasingly more efforts to ensure good corporate social responsibilities.
♥ The FMCG brands found in consumer products is a trusted name for millions of consumers worldwide. The ultimate aim is to make sure the products help people get more out of life, making our days better in small and meaning ways. And for this – We love the FMCG industry.