WHITE GOODS COS TIGHTEN PROMO PURSE

Consumer goods companies have moderated their spending in promotional activities and have hiked prices in key segments amidst inflationary pressures in the form of higher raw material costs.

According to analysts at Jefferies, the promotional intensity, which heightened in the past 34 months, now seems to be coming down. This according to it is also a function of increase in raw material prices, especially crude- linked raw materials.

“We saw some ease in promotions in detergents and shampoos, which have been high for quite some time now, though some promotions were still on, especially in shampoos from Hindustan Unilever. Both food and non- food based raw materials were flattish in August but the trend remains inflationary,” it said.

There was an upward movement in the price of mentha ( up 15 per cent month on month), soda ash ( 25 per cent MoM) and crude ( up 4 per cent MoM). Responding to higher input costs, Jefferies noted that the market has been witnessing more price hikes in categories such as paints, toothpaste, hair oil and edible oil.

Earlier, the price hikes were seen in detergents and skin care. For instance, Hindustan Unilever has gone for price hikes in detergents, skin care and select soap brands in the 5- 7 per cent range.

Meanwhile, innovation intensity also remains high with new launches. Recently, Godrej Consumer extended Cinthol range to the male grooming segment and launched beard and face wash, beard wax and oil, among others. Nestle entered the dips segment with launch of Maggi Dip and Spread.