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India Quarterly: Mary Kay to Invest $20 Million in India

By: Priyanka Bhattacharya
Posted: January 10, 2008, from the January 2008 issue of GCI Magazine.

page 5 of 5

The total fast moving consumer goods (FMCG) category in India is currently valued at $15 billion, of which $2.85 billion is attributed to rural areas and $4.2 billion to semi-urban areas. Furthermore, the report stated that personal care product spending accounts for 8%, a figure expected to go up in the near future. And as spending patterns and demographics shift, consumer patterns in rural areas are expected to be the most affected. Venugopal Dhoot, president, Assocham, explained that the 20% increase in profitability of FMCG companies operating in India 2006–2007 is attributable to market growth within semi-rural and rural areas—a significant realignment.

The growth in market share in these areas is also expected to impact the urban Indian market, where the market share is expected to fall 25% by 2010. Assocham’s report stated that the loss will also be attributable to urban consumers’ rejection of excessive FMCG consumption and move toward the use of more sophisticated, natural and organic products.

Godrej Taps Into Growing Hair Color Market

With a goal to strengthen its hair color business in the Indian market, Godrej Hair Care Institute (GHCI), a center dedicated to the art and science of hair care in India, has introduced a Natural Brown shade of Renew Hair Colour Cream in a smaller pack.

“Renew has been [much] appreciated by consumers,” said R K. Sinha, executive vice president operations and marketing, Godrej. “Its unique formula offers a great coloring experience, which the consumers will enjoy. Buoyed by the success of the 50 mL pack, we are now introducing a smaller 20 mL pack. With the launch of Natural Brown in a small pack, Renew provides its consumers an opportunity to use fashionable colors at an affordable price.”

GHCI expects the pricing of Rs40 for the 20 mL pack to be the key pull for Godrej Renew Natural Brown. This shade has been specially formulated to complement Indian skin tones. The new product has a cream formula that is easy to apply and does not drip, and is enriched with aloe vera extracts and protein conditioners.