I was recently sent an e-mail which purported to draw out the differences of Consumer Telecoms distribution vs. FMCG. It was at pains to point out the differences and why they are not the same.
Then a few days later I got a contradicting article, quoting Unilever execs, which contradicted the first article to some degree. So where does the truth lie? Per the cliche, it is somewhere in-between.
Some of the examples the first article used were relevant, in calling out where traits displayed in FMCG are not seen Telecoms:
- Stability in product pricing
- Quality issues are rarely a concern of the sales function
- There is a clear difference in approach between penetration pack sizes and consumption pack sizes
- Price drops are not common
- Price protection of trade is rare
- Independent brand outlets are the privy of really premium brands
- Marketing messages generally focus on solutions to generally known problems/emotions, eg oiliness, stickiness, smelliness, dryness, shyness etc.
- Global pricing is not a common practice.
- There is no secondar resale value of products
But is it so clear and easy? Most certainly not.
A core difference is that in the FMCG sector is that the market is saturated and that margins are fairly low. Revenue gains are made in channel ownership and loyalty, so share of shelf is key.
[Grant Marais]
[Grant Marais]
