MUMBAI: Future Group, the leading Indian retail business, intends to add significantly to its existing portfolio of FMCG brands as it aims to take a larger share of this market, a step that will put it into more direct competition with the likes of Hindustan Unilever and Britannia Industries.
"We were always a consumer goods company," Kishore Biyani, group CEO, Future Group maintained.
"Retail is a way of distributing your goods," he told the Economic Times. "Big Bazaar became big and we are known by that name but our ability to think multiple brands at the same time exists."
Big Bazaar is only one of the retail formats operated by Future Group – others include Food Bazaar, Foodhall, KB's Fair Price and the recently acquired Nilgiri's and Easy Day.
The scale of Biyani's ambitions are apparent in his aim of more than quadrupling the number of SKUs to 2,000. And while Future Group's own brands currently contribute an estimated Rs 1000 crore, Biyani wants that figure to hit Rs 10,000 crore by 2020.
But the advertising industry may not benefit as much as those figures might suggest, as Biyani declared that the traditional ways of launching and building a brand are over.
"In the new world, it's not just branding but the role of the product, its quality and distribution that make a difference," he explained.
"All the old economy people still believe in building brands and spending money on advertising: I think brands are about an experience. That cannot be built merely through advertising."
A challenge for Future Group will be getting its brands into retailers beyond its own collection of stores, without giving consumers a reason to shop elsewhere.
"We won't get into traditional distribution," Biyani said. "One of our logistics company will set up warehouses. Though technology we will appoint distributors and take orders. It will be very different."
In five years' time he confidently expected that "30% to 40% of all our brands will be sold in other stores" while 70% of sales in Future Group stores would be its own brands.
Data sourced from Economic Times; additional content by Warc staff