Friday, July 4, 2008

Inflation, Recession and the return of sachets.........


A few days back I had written on how consumers tend to down-trade when they feel the pinch of economic slow-down. The situation wherein a consumer shifts from a premium and more recognized brands to cheaper brands or private labels.


In the last few months in Indian retail the focus is supposedly back on smaller pack sizes on the back of rising inflation and fears of a slow down. The expectation is that consumers than buying the bigger packs would shift to smaller packs of their favorite brands. This actually seems to make sense in the Indian context as the availability of private brands is very low, so the options for down trading for a consumer is also limited..

Like as with the case of Henkel which has just introduced a new 400 gm pack of Henko washing powder at Rs 40 and withdrawn the 500 gm pack that used to sell for Rs 46. It has re-introduced Pril liquid for Rs 50 (425 gm bottle), down from Rs 55 (500 gm). For more on this , link

This is sharp contrast a few months back when many had started predicting the dead of small packs with the organized retail focusing more on the bigger packs..............

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