FMCG ad spends set to shoot  ( May '22,2007, FE)

To drive volumes in an increasingly competitive market, India’s largest fast-moving consumer goods (FMCG) majors are hiking their advertising budgets this financial year.

ITC Foods is hiking its ad spend 120% and Godrej Consumer Products is increasing its budget by 30%. In 2006-07, ITC Foods spent over Rs 390 crore on ads, while GCPL’s budget was at Rs 72 crore. Catching up is Gujarat Co-operative Milk Marketing Federation Ltd (GCMFL). It is hiking its ad spend by 20% and Parle Agro by 50%.

ITC’s 120% hike would largely constitute spends on new launches Bingo and Sachin’s Fit Kit, key industry sources told FE.

The aim is to gain high visibility in the Rs 69,000-crore Indian FMCG industry. “With the entry of new players and categories, this sector is really heating up,” a Mumbai analyst said.

HK Press, executive director, GCPL, said there was a vital need to stand out from the clutter. Sharing this view, Nadia Chauhan Kurup, director, Parle Agro, said, “To break the clutter, you need to spend both on traditional and non-traditional media now.” Dabur CEO Sunil Duggal, said, “In step with our revenue, we increase our ad spend 11-12 % of our sales every year.”