Small brands make big push

According to Nielsen data, growth is coming from outside of Canada's top 20 brands.

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When it comes to fast moving consumer goods, the top brands’ stranglehold on the market appears to be loosening, according to a recent FMCG study by Nielsen.

Based on dollar sales, the top 20 brands in Canada hold nearly 30% of the FMCG market, with the brands in the 21 to 100 spots holding a nearly 26% share. However, they’re growing at 13.3% and 20.5% year compared with last year respectively, and being outpaced by the growth of the brands outside of the top 100, at nearly 39%.

And when it comes to small brand manufacturing growth, overall food is leading the way at 6%, while grocery is in decline (4%) and beauty aids are stable. In terms of per cent dollar share, food occupies nearly two-thirds (64%) compared with grocery (14%) and health and beauty aids (14%). According to Nielsen, the bulk of dollar change is coming from brands that are outside of the traditional top 20, as shown in the below graph: $312.6 million and $514.80 million, compared with $202.8 million for the top 20 brands.

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Canadian small brands are also outpacing American rivals when it comes to growth (4% to 1%). Small U.S. brands account for 32% of small brand sales, compared with 51% in Canada.

Discount FMCG retailers are growing at four times the rate of conventional retailers, according to Nielsen’s data, with Ontario leading the discount charge.

For big brands competing in Canada, the Nielsen report makes suggestions on how they can maintain and grow their share. This includes through mergers and acquisitions and acquiring smaller brands that are leading growth. An example is Molson Coors’ Six Pints ​​division, responsible for growing the brand’s craft segment, which purchased Quebec microbrewerer, Le Trou in 2017.

Other ways major FMCG brands can stay competitive, is by mimicking smaller competitors’ nimbleness and understanding consumers’ attitudes and preferences for brand place-of-origin. For example, both Chapman’s Ice Cream and Kawartha Dairy highlight their “Canadian” bona fides with flags and blue “100% Canadian milk” logos.