Wed Sep 09, 2015 01:18 PM
president of ITC's fast-moving consumer goods (FMCG) business, talks to Viveat Susan Pinto about his priorities and his plans to reach Rs 100,000 crore in annual turnover. Edited excerpts:How are you translating the aim of being present in every FMCG category?There are certain segments where we are already present, such as packaged foods, personal care, personal wash and branded staples. One task would be to strengthen our footprint in these segments and continue bringing in new products like we did with cookies in the biscuits category. The journey started with Mom's Magic last year, which has been received well. We backed up that effort by stepping into premium cookies.The second task would be to enter categories where we are not present at all. Like we did with Be Natural in juices or Shower to Shower and Savlon in personal hygiene, all of them acquisitions, but critically they give us entry into new categories. As we go forward, dairy will be the next one to roll out. We will step into ghee in this quarter and will look at more dairy products in the future.Dairy is not a category that FMCG majors have cracked. The stranglehold of co-operatives continues...If your sourcing model is in place, I don't see why one can't crack it. The advantage we have is this huge agri-backend that we've built over the years. We are leveraging that in the dairy segment as well. I cannot get into too many details about it at this stage, but once our products begin rolling, you will see how this has helped us.You have done well in packaged foods and deodorants but soaps and shampoos has been your weak spot. What are you doing to improve in these categories? There is a lot differentiation we've brought to the market in personal care. Much of this has been an in-house effort - understanding consumer needs, developing the right set of products. In personal care, specifically, personal wash, we have taken a regional, very targeted approach to the business. We are the market leaders in the northeast, for instance. We have large shares in West Bengal, Kerala, Gujarat and Orissa. These are markets we've been investing.Even as we are doing this, we are expanding our footprint into newer geographies. We are on air in Tamil Nadu, for instance. This way we will ensure we make solid gains in respective geographies. We are also strengthening individual products such as Vivel and Fiama and launching region-specific variants. These have been received well in their respective markets.Are you building a separate distribution network for the FMCG business? It makes perfect sense for us to have a common distribution platform rather than one for cigarettes and another for non-cigarette FMCG products. One may argue that after your business reaches a certain size and scale, it is imperative to separate the two in terms of distribution but I don't think so. I believe there are significant synergies that one derives from a common platform. So, the FMCG business rides the distribution platform available to cigarettes. There is merit in having the two together. Yes, what we are doing is strengthening this network with the help of technology and forming separate teams that can service different channels and clusters of products. But we do not intend to separate the two.What are you doing to address e-commerce?It is a growing channel and something that we are exploring seriously. We already have a separate teams looking at e-commerce like we do in the case of general and modern trade. We are already working with e-commerce majors. Some of our premium products can be pushed online and there is a market for them out there.