ITC : Bridging Consumer Needs with Sustainable Innovations
Sanjiv Puri , Chairman & Managing Director
Fast-moving consumer goods, or FMCG, is one of India’s fastest growing industries, being fuelled by an ever-growing middle class, rising disposable income, and rapid urbanization. The market is expected to reach $616 billion by 2027 propelled by domestic and international brands with innovative products. E-commerce penetration, government initiatives such as Make in India, and rural development programs are continuing to influence the growth of the market.
Although this is a good prospect, the industry has its share of challenges. With so many products similar to one another in the market, one must pay attention to what they are. As the buying power gets affected by the vacillations of the economy, customers now look for value for their money. With regard to trust, quality, and sustainability are still major issues, particularly for rural areas. In addition, product availability in remote locations is usually fragmented, which leads to inconsistent distribution across the network.
ITC Limited, the Indian conglomerate involved in FMCG, Hotels, Paperboards, Packaging, Agribusiness, and Information Technology, has emerged as a strong player in tackling the crises of the FMCG sector. The financial stand of ITC, as of March 2024, is evident from its ₹69,446 crore gross revenue and ₹20,422 crore net profit. ITC has a heritage of over a century and has moved from being a tobacco company to becoming a multi-faceted enterprise, which addresses a wide range of consumer needs and pursues sustainable practices.
Diverse Product Portfolio
ITC’s extensive product range is a key to its success. Its FMCG division comprises branded packaged foods, personal care, education and stationery products, lifestyle retailing, safety matches, and agarbattis (incense sticks). Aashirvaad, Sunfeast, Bingo, and Fiama have become popular household brand names in India.
ITC offers consumers a broad range of products across the price spectrum from the bargain hunter in rural India to the high-end product seeker in urban markets. The diversification is to help the company diversify the risk of being dependent on a single category without losing relevance with a demographic and geographic segment.
Emphasis on Quality and Innovation
ITC’s focus on quality and innovation helps it stay ahead in a crowded market. Through its state-of-the-art ITC Life Sciences and Technology Centre in Bengaluru, the company has invested heavily in research and development. This center propels innovation in product categories and keeps ITC ahead of the curve in consumer preferences.
For instance, ITC also introduced fortified atta (flour) under its Aashirvaad brand to counter nutritional deficiencies in the diets of the Indians. Just like its Sunfeast biscuits and Bingo snacks, the company is equally committed to combining flavours that are traditional and those that people have become accustomed to. Such innovations are what make customers satisfied and build brand loyalty.
Sustainability as a Core Principle
ITC has assumed sustainability as an inherent part of its business model and has been acknowledged as a pioneer of environmentally responsible actions. It has been carbon-positive, water-positive, and solid waste recycling positive for decades. These milestones demonstrate ITC’s dedication to decreasing its environmental mark while adding value to the community.
ITC has a large afforestation program not only for supporting rural livelihoods but also for its renewable resource base for its paperboards and packaging business. Its sustainability initiatives are a strong fit with environmentally minded consumers, and its brand appeal is proof of this, given that sustainability is a key purchasing driver in today’s marketplace.
Robust Agri-Business Linkages
ITC’s agricultural roots mean it is uniquely placed to guarantee quality and traceability for its food products. In fact, the company sources raw materials from farmers directly through its e-Choupal initiative, a digital platform that facilitates farmers to get real-time market information and purchase agricultural input.
This initiative is beneficial for ITC as well as its stakeholders. The company receives a steady supply of high-quality raw materials from the farmers who get better prices for their produce. ITC uses the technology to integrate it with traditional farming practices to address rural challenges and to fortify its supply chain.
Strong Distribution Network
ITC has a formidable distribution network that routes its products across urban and rural zones. It has constructed one of the most extensive distribution systems in the industry with millions of retail outlets across the nation.
In recent years, ITC has been adopting omnichannel strategies, which include complementing its physical distribution network through digital platforms. This dual approach makes FMCG products more accessible and convenient for consumers in the post-pandemic era when e-commerce has become an important channel for FMCG products.
Consumer-Centric Approach
ITC’s strategy is based on the understanding of consumer behavior. Advanced analytics and market research by the company allow it to see emerging trends and present the offering accordingly. Its personal care products have focused on natural ingredients and are catering to the growing demand for chemical-free products.
ITC also employs a proactive approach to engaging with customers by taking the help of digital campaigns and working with influencers to strengthen brand bonding. This way, it continues to be current in the ever-changing market landscape.
Commitment to Social Impact
ITC has always gone beyond business to create a positive social impact. Areas of focus for the company’s Corporate Social Responsibility (CSR) include primary education, skill development, sanitation, and women’s empowerment.
Mission Sunehra Kal is a program created to enhance rural livelihood through sustainable agricultural practices and watershed development. In addition, these initiatives also fit with ITC’s long-term vision of promoting inclusive growth.
As the FMCG market in India grows, companies like ITC will be playing a big role in setting new standards and creating consumer experiences in the industry. The story of ITC is of a business that can sustain itself while contributing to the larger social objectives by staying in tune with market trends and investing in its core strengths.
Although this is a good prospect, the industry has its share of challenges. With so many products similar to one another in the market, one must pay attention to what they are. As the buying power gets affected by the vacillations of the economy, customers now look for value for their money. With regard to trust, quality, and sustainability are still major issues, particularly for rural areas. In addition, product availability in remote locations is usually fragmented, which leads to inconsistent distribution across the network.
ITC Limited, the Indian conglomerate involved in FMCG, Hotels, Paperboards, Packaging, Agribusiness, and Information Technology, has emerged as a strong player in tackling the crises of the FMCG sector. The financial stand of ITC, as of March 2024, is evident from its ₹69,446 crore gross revenue and ₹20,422 crore net profit. ITC has a heritage of over a century and has moved from being a tobacco company to becoming a multi-faceted enterprise, which addresses a wide range of consumer needs and pursues sustainable practices.
Diverse Product Portfolio
ITC’s extensive product range is a key to its success. Its FMCG division comprises branded packaged foods, personal care, education and stationery products, lifestyle retailing, safety matches, and agarbattis (incense sticks). Aashirvaad, Sunfeast, Bingo, and Fiama have become popular household brand names in India.
ITC offers consumers a broad range of products across the price spectrum from the bargain hunter in rural India to the high-end product seeker in urban markets. The diversification is to help the company diversify the risk of being dependent on a single category without losing relevance with a demographic and geographic segment.
Emphasis on Quality and Innovation
ITC’s focus on quality and innovation helps it stay ahead in a crowded market. Through its state-of-the-art ITC Life Sciences and Technology Centre in Bengaluru, the company has invested heavily in research and development. This center propels innovation in product categories and keeps ITC ahead of the curve in consumer preferences.
For instance, ITC also introduced fortified atta (flour) under its Aashirvaad brand to counter nutritional deficiencies in the diets of the Indians. Just like its Sunfeast biscuits and Bingo snacks, the company is equally committed to combining flavours that are traditional and those that people have become accustomed to. Such innovations are what make customers satisfied and build brand loyalty.
Sustainability as a Core Principle
ITC has assumed sustainability as an inherent part of its business model and has been acknowledged as a pioneer of environmentally responsible actions. It has been carbon-positive, water-positive, and solid waste recycling positive for decades. These milestones demonstrate ITC’s dedication to decreasing its environmental mark while adding value to the community.
ITC has a large afforestation program not only for supporting rural livelihoods but also for its renewable resource base for its paperboards and packaging business. Its sustainability initiatives are a strong fit with environmentally minded consumers, and its brand appeal is proof of this, given that sustainability is a key purchasing driver in today’s marketplace.
Robust Agri-Business Linkages
ITC’s agricultural roots mean it is uniquely placed to guarantee quality and traceability for its food products. In fact, the company sources raw materials from farmers directly through its e-Choupal initiative, a digital platform that facilitates farmers to get real-time market information and purchase agricultural input.
This initiative is beneficial for ITC as well as its stakeholders. The company receives a steady supply of high-quality raw materials from the farmers who get better prices for their produce. ITC uses the technology to integrate it with traditional farming practices to address rural challenges and to fortify its supply chain.
Strong Distribution Network
ITC has a formidable distribution network that routes its products across urban and rural zones. It has constructed one of the most extensive distribution systems in the industry with millions of retail outlets across the nation.
In recent years, ITC has been adopting omnichannel strategies, which include complementing its physical distribution network through digital platforms. This dual approach makes FMCG products more accessible and convenient for consumers in the post-pandemic era when e-commerce has become an important channel for FMCG products.
Consumer-Centric Approach
ITC’s strategy is based on the understanding of consumer behavior. Advanced analytics and market research by the company allow it to see emerging trends and present the offering accordingly. Its personal care products have focused on natural ingredients and are catering to the growing demand for chemical-free products.
ITC also employs a proactive approach to engaging with customers by taking the help of digital campaigns and working with influencers to strengthen brand bonding. This way, it continues to be current in the ever-changing market landscape.
Commitment to Social Impact
ITC has always gone beyond business to create a positive social impact. Areas of focus for the company’s Corporate Social Responsibility (CSR) include primary education, skill development, sanitation, and women’s empowerment.
Mission Sunehra Kal is a program created to enhance rural livelihood through sustainable agricultural practices and watershed development. In addition, these initiatives also fit with ITC’s long-term vision of promoting inclusive growth.
As the FMCG market in India grows, companies like ITC will be playing a big role in setting new standards and creating consumer experiences in the industry. The story of ITC is of a business that can sustain itself while contributing to the larger social objectives by staying in tune with market trends and investing in its core strengths.
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