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How FMCGs can target retailers and consumers

Released at: 12:43, 22/07/2015

How FMCGs can target retailers and consumers

Ms. Nguyen Huong Quynh, Executive Director, Retail Measurement Services, at Nielsen Vietnam, suggests how manufacturers of fast-moving consumer goods (FMCGs) can reach more retailers and customers.

by Thu Hoang

Ms. Nguyen Huong QuynhWhat strategies should manufactures in FMCGs do to become a favorite brand among retailers and consumers?

According to the Nielsen report on Vietnam’s retailers in the first quarter of this year, despite the development of Modern Trade, Traditional Trade is still a key channel.

It’s still quite challenging to obtain retailers’ support, however, because only 70 per cent of traditional retail stores comply with manufacturers’ requests to stock their products.

To enhance in-store sales effectiveness and win retailers’ loyalty, Nielsen suggests that manufacturers focus on the right “what” and “where”.

Firstly, with such a complex retail market, it is essential for manufacturers to identify the right stores to target their priority investment. Only when this stage is completed can manufacturers focus on launching a logical plan of attack for route to market, sales force deployment, direct vs. in-direct store strategy, and stock availability.

Secondly, a picture of success is normally comprised of a combination of the following: pricing, assortment, trade activity, and in-store communication. However, ensuring that these component parts are executed in store and complied with after agreement from retailers remains a major challenge for manufacturers.

Is there any difference in business strategies that FMCG manufactures implement in urban and rural areas?

Nielsen Vietnam has not found any detailed information on the current strategies of manufacturers.

According to the Nielsen ASEAN cities report, however, secondary cities and rural areas are a large piece of the Vietnam pie and cannot be ignored. Consumers in these areas are changing and changing fast. They are increasingly well educated, have higher levels of disposable income, and are more aware of trends in the market than ever before.

However, there are a lot of differences between rural and urban consumers. Therefore, Nielsen has suggested some elements manufacturers should focus on when expanding their scope to secondary markets.

Firstly, for companies looking to enter these markets for the first time, develop a strategy to identify and enter smaller secondary cities and rural areas within an appropriate timeframe. Identifying regional capitals as an entry point can provide an “early mover” advantage.

Secondly, develop innovation that is driven by the unique needs, challenges and lifestyles of rural and small city consumers rather than adjusting offerings generated primarily for big city consumers

Thirdly, generate differentiated innovation, marketing, sales and distribution strategies given that traditional trade is the key channel in rural markets.

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