Emami sees robust growth through modern commerce and e-commerce
Terroir FMCG Product maker Emami aims to double its rural coverage in three years, aiming to reach 60,000 cities by the end of FY24, according to the company’s chief executive, SK Goenka. The initiative is taken up within the framework of its Khoj project. As of FY21, Emami’s reach in non-urban areas was 32,000 cities.
“In a country as vast and populous as India, the challenge is not so much in branding and manufacturing as in placing the product where the consumer needs it.“, Goenka said in the company’s annual report for 2021-22.
“We aim to double our rural coverage to 60,000 cities in 13 states in three years, expanding coverage and seeding sites with Emami products for the first time“, said Goenka.
In FY23, Emami intends to maintain strong margins through tight cost control and volume-led growth. It plans to absorb rising raw material costs through operational efficiency and sensible price increases.
“The company wants to invest aggressively in new launches as well as its core brands for growth opportunities“, Emami said of the outlook for FY23.
Emami expands its distribution coverage, placing the product where the consumer needs it. The Kolkata-based company will also address the changes taking place in its urban markets both post-pandemic and consumer purchasing behavior is changing. It has created a separate marketing and distribution network for 10-12,000 stand-alone modern trade stores. This orientation has also been extended to e-commerce.
“We believe the world is moving towards convenience-driven platforms. Your business has been nimble enough to capitalize on this consumer transition“, said Goenka.
Emami’s modern commerce revenue grew 17% in FY22, while its focus on e-commerce doubled its revenue and contributed 5.5% to its domestic business. The previous year, the contribution of online sales channels was 2.8%. It is also increasingly focusing on sales via e-B2B (Business-to-Business) and D2C (Direct-to-Consumer) channels.
“The company’s modern commerce and e-commerce channels are expected to see robust growth. Emami products should be available in all key formats (including e-pharma and quick trade accounts outside of marketplaces like eGrocers),‘ Emami said.
The company plans to strengthen its digital-focused portfolio across all key brands. Emami has launched digital products for Zandu, Navratna and Kesh King brands.
“The company’s modern commerce business will launch digital-first brands through Omni-channels, increasing Zandu Ayurvedic Healthcare’s portfolio contribution to 10% of total modern commerce business.“, says the annual report.
Today, Emami also recognized that the key to long-term sales sustainability would come from relationship-driven business engagements. He launched outlets for health products, focusing on Ayurvedic bhandars and chikitsalayas. It also rolled out a pilot in select cities where the company launched an upsell and cross-sell app for the frontline sales team.
“The Company Will Introduce More Technology-Based Distribution Initiatives to Accelerate Pickup“, he said. In the financial year which ended March 31, 2022, Emami’s revenue amounted to Rs 3,192 crore.