Changing Trends in Fmcg Industry in Turkey

Changing Trends in FMCG Industry in Turkey

KAAN MUTLU

070160251

Contents

FMCG Industry.........................................................................................................................1

Value Creation...........................................................................................................................1

How to Compete in the Sector...................................................................................................1

Price Differentiaotion and Promotion......................................................................................1

FMCG Industry in Turkey.......................................................................................................2

FMCG Trends in Turkey..........................................................................................................3

Increase in Demand For Discount Supermarkets...................................................................3

Local, Organic, Natural............................................................................................................3

Hygge..........................................................................................................................................3

From Shopping Cart to Shopping Basket................................................................................3

Using Online Channels..............................................................................................................4

References..................................................................................................................................5

FMCG Industry

Majumdar (2004) describes Fast-Moving Consumer Goods (FMCG) or Consumer Packaged Goods (CPG) as products that are sold quickly, and at relatively low cost. Since these kind of products are relatively cheaper than the other products in the market, they also have a relatively lower profit margin but higher volume. FMCG can be divied into four main categories such as, household, personal care, food, beverage.

Value Creation

        As in every sector, the FMCG sector also tries to reach the customer with different offers to make a difference from its competitors by creating value, since the product is defined as something offered in the market which producers or suppliers offer to bring value and satisfy wants or needs of a customer. Philip Kotler (1980) argues that the company must offer its customers a complete and integrated value proposition from the supply chain to after-sales services which is called integrated marketing. As FMCG is one of the fast-changing industries, it is important to adapt to the trends and be ready for challenges.        

        How to Compete in the Sector

        Any company wishing to maintain its presence in the market must adapt to changing conditions and adapt to the environment. In sectors such as fast moving consumer goods, companies try to compete with different strategies. With these principles, which we call 4Ps (product, price, place, promotion) of marketing, companies try to be effective in purchasing decision of the end consumer.

        Price Differentiaotion and Promotion

        The FMCG is one of the sectors with the highest competition due to the high dynamism, the matureness of the market, the increasing quality of market brand products and the effect of cost pressure. Competitiveness in cost items in the FMCG sector comes to the forefront with the cooperation and cooperation with the suppliers on the vendors' side. Large organizations are trying to develop with unification and acquisitions in order to prevent loyalty to external organizations in raw material, to keep the standard on raw material price and quality issues and to avoid losses caused by other purchasing restrictions. For small businesses, sharing suppliers' dependency and low-profit margins with suppliers and distributors is an important factor that reduces competitiveness. In recent years, where consumer goods retailing has been on the rise, distributors have been replaced by distributors who provide logistics services’. Secondly, they may prefer the promotion. Demand for products sold with increasing prices is falling. As the price inflation in consumer goods exceeds the increase in income, consumers' sensitivity to price increases also increases, but also the sensitivity to promotions increases. In such cases, companies can make promotions by making joint ventures or agreements.