MUMBAI: Smaller cities in India will drive growth for FMCG companies in the coming decade, research firm Nielsen has said.
The new study, unveiled at the CII Marketing Summit in Mumbai, suggests that the country's top ten FMCG companies have seen per-dealer growth of 17% in less-populous urban areas in the past year.
Sargent further noted that the current trend is for towns with populations of less than 100,000 to show the highest overall growth for the future.
But obstacles to future growth remain, with the report suggesting that brand success in these markets will rely on development of more effective distribution infrastructure over the next two years.
Improvements in distribution and packaging will help reach consumers efficiently and propel scalable growth.
"We are seeing the demand percolating from middle India to these lower towns," Sargent said.
Data sourced from Economic Times/Nielsen; additional content by Warc staff