Indian consumers not so sensitive to discounts: Indian FMCG Leaders
MUMBAI: Leaders of the Indian FMCG industry, today, said customers are not as price sensitive as we think and that discounts are not so significant when pitted against the value of the product being sold.
Harish Bhat, chairman, Tata Global Beverages, that is also responsible for bringing global coffeehouse chain Starbucks to India in 2012, said, "Across the city of Bombay, you hardly see empty chairs in Starbucks outlets, if you step out in the evening."
Differentiating the need for discounts on the basis of products containing a pull or push appeal, Rohan Vaziralli, brand manager of cosmetics chain brand, Estée Lauder India, said, "We don't discount as ours is not a push model, it is more of a push model. However, if you can improve the point of sale execution, you can defeat the importance of discounts as a seller." He added saying that customers are not as price insensitive as we think.
Discounts have always been a way for sellers of Fast Moving Consumer Products to lure customers into spending during a lean period, as well as to clear inventories for a change in product offerings.
In a report released by Retailers Association of India and Boston Consulting Group in February, it was noted that in case of online shopping, convenience has overtaken discounts as a key driver for buying online. According to the report, online shopping led by convenience rather than discounts have increased from 40% in 2014 to more than 55%.
"Luggage is a perennially discounted item," Radhika Piramal, MD, VIP Industries, said.
However, Bhat added by saying that the need for and nature of discounts would also differ according to the value exclusivity of different categories. When buying salt, you are seldom to prefer a discount attraction over the nutritional value that a particular salt brand offers, when compared to other products.
Tata Global Beverages is the maker of Tata Salt, the market leader of salt in India.
The FMCG leaders spoke on the CII National FMCG Summit, 2017, held today in Mumbai.
Harish Bhat, chairman, Tata Global Beverages, that is also responsible for bringing global coffeehouse chain Starbucks to India in 2012, said, "Across the city of Bombay, you hardly see empty chairs in Starbucks outlets, if you step out in the evening."
Differentiating the need for discounts on the basis of products containing a pull or push appeal, Rohan Vaziralli, brand manager of cosmetics chain brand, Estée Lauder India, said, "We don't discount as ours is not a push model, it is more of a push model. However, if you can improve the point of sale execution, you can defeat the importance of discounts as a seller." He added saying that customers are not as price insensitive as we think.
Discounts have always been a way for sellers of Fast Moving Consumer Products to lure customers into spending during a lean period, as well as to clear inventories for a change in product offerings.
In a report released by Retailers Association of India and Boston Consulting Group in February, it was noted that in case of online shopping, convenience has overtaken discounts as a key driver for buying online. According to the report, online shopping led by convenience rather than discounts have increased from 40% in 2014 to more than 55%.
"Luggage is a perennially discounted item," Radhika Piramal, MD, VIP Industries, said.
However, Bhat added by saying that the need for and nature of discounts would also differ according to the value exclusivity of different categories. When buying salt, you are seldom to prefer a discount attraction over the nutritional value that a particular salt brand offers, when compared to other products.
Tata Global Beverages is the maker of Tata Salt, the market leader of salt in India.
The FMCG leaders spoke on the CII National FMCG Summit, 2017, held today in Mumbai.
