Big consumer companies gear up to ride the festive wave

Top consumer goods makers are hopeful of a strong demand recovery in the upcoming festive season and have started drawing their business plans accordingly across inventory, new product launches, and staffing, even though high prices remain a concern as of now.

“We anticipate that consumers are likely to celebrate this festive period with renewed fervour, given that the last two years were spent largely indoors,” said Anil Viswanathan, vice president, marketing, at Mondelez. “However, we are cautiously optimistic.” Mondelez, which makes Cadbury and 5-Star chocolates, is the country’s largest chocolate company.

The festive season, which will commence towards the end of August with Raksha Bandhan, Onam and Ganesh Chaturthi and last till Diwali in October, is India’s largest consumption period.


Festive season in the last two years, however, were marked by Covid-induced supply disruptions and intermittent lockdowns that impacted consumer buying behaviour.

“We believe this year’s festive season will be robust,” said Nissan Joseph, chief executive of footwear retailer Metro Brands. “Moreover, we are facing the remnants of the third wave from last October, so we remain optimistic.”

He said the company has mitigated the impact of a protracted challenging environment regarding supply chain and raw material price increases. “We managed inventories in advance to help mitigate against any significant spike in pricing,” Joseph said.

While demand may have slowed down at present due to the inflationary environment, marketers expect consumers to unleash the pent-up demand around festive season, aided by salary hikes, bonus, softening of commodity prices that has led to lower consumer prices of packaged edible oils, and a good monsoon.

Godrej Appliances business head Kamal Nandi said outlook for the festive season is positive since consumers who are postponing purchases now are expected to buy then. The white goods market has slowed down since mid-May due to inflation.

“A lot will depend on how inflation will be controlled, but expectations are positive on improvement in discretionary spending,” Nandi said.

A spokesperson for ITC, which makes packaged foods and personal care products, said, “We are expecting good festival pickup this year as this would be the first festival after two years of restrictions.”

ITC’s supply chains are geared up to ensure festival packs are available across all channels with the onset of the festival season, the spokesperson said. “However, high prices remain an area of concern,” he added.

Retailers and companies across categories said they are ensuring they are equipped to cater to demand across both physical stores and on ecommerce platforms.

“All our digital assets for the festive period are sold out given they were part of long term plans,” said Amit Dutta, chief executive of premium and gourmet packaged foods retailer Le Marche Retail. He said existing concerns about inventory blips on account of steep inflation would be short-term.

Consumer electronic companies are projecting 15-20% sales growth over 2019.

“We are witnessing slower pace of growth and pressure in demand, especially entry level products, which may continue for next couple of months, but we expect a good recovery during festivals, mainly driven by bigger capacity and improved technology products as consumer sentiments will improve,” said Deepak Bansal, vice president at LG Electronics, the country’s largest appliance manufacturer.

Companies said they plan to start peak production for the festive season from August.