There's space for all to grow - Economic Times
February 01, 2010
ITC's Aashirvaad, Sunfeast & Bingo Have Become Household Names
MORE than seven years after ITC Ltd's Foods division shot into the staples, confectionery and snack food categories, its brands such as Aashirvaad, Candyman, Sunfeast and Bingo have become household names. The division, which has a strong rural penetration, is chasing maiden profitability this fiscal. V L Rajesh, general manager, marketing & exports, foods division, spoke with Sarah Jacob about the progress it has made in credibly engaging with the consumer by developing products for different segments and at multiple price points.
Excerpts:
How has the company established itself in the foods category since its foray in 2002?
We are one of the youngest organised players in this industry and are already pretty sizable. Take for instance, brand Sunfeast. Despite entering a category where our lead competitors have been operating for multiple decades, we have created our own head space and are striking forward in a calibrated fashion. In fact, our strategy of straddling varied categories such as confectionery, ready-to-eat, biscuits, atta (wheat flour) and spices has meant that we don't have any one competitor that is spread across all segments. ITC Foods has great traction with consumers in terms of brand recall and perception of quality across segments.
In a market dominated by big players such as Parle and Britannia, how does Sunfeast differentiate itself?
The biscuits industry is estimated at around
Rs 10, 000 crore and is growing in double digits.
At the same time, the rate of growth of the
industry is also a function of what extent of the
equallylarge unorganised sector is graduating
towards quality and recognised offers. This means
that there is space for everyone to grow and that
the industry does not mandate each player to have
a mutually exclusive set of products. However,
Sunfeast entered the market with several
innovative products, take for instance, orange
Marie, differentiated creams such as butterscotch,
flavour inclusions within biscuits and flaxseed
biscuits.
Shah Rukh Khan was roped in for the Sunfeast brand launch. How essential is brand endorsement to ITC Foods' marketing strategy?
Brands have different needs at varying points
of time. The first task for us was to create
salience in the consumer's mind space, which is
why we opted for a celebrity. At that time, we had
a certain product range which has significantly
expanded since. This has meant that each part of
the portfolio and its facets need to be
communicated differently as the consumer is buying
into it for differing reasons. Celebrities have
massive badge value and their marketing
involvement would be based on the growth of the
brands. But Sachin Tendulkar continues to endorse
certain products that are relevant to children.
Bingo has driven innovation through varied
textures and shapes in a category synonymous with
Lay's. How has the brand grown?
Bingo's differentiated marketing has given it a
wacky presence in the expanding chips category
with a market share of 11-12%. ITC Foods has a long term
play in this segment. We launched Bingo with 16
products and have overtime rationalised some while
adding variants such as Hatke Jhatke and Tedhe
Medhe. Salt, tomato and masala are the
best-selling flavours in this category today. But
the challenge is to innovate while pitching for
the right consumer taste preferences. Being a
highly-impulse driven category, consistent brand
inputs are essential to retain and gain loyalty.
What is Aashirvaad position in the atta category?
Aashirvaad is a relatively premiumpriced brand
with an urban volume share of over 50% among
national branded atta players. It is probably one
of our strongest brands today with a loyal base.
The branded atta segment is growing in double
digits despite being less than 3% of the total
market. As the market leader our focus is on
increasing the chunk of conversions, which is
supported by our value-added sub brand Aashirvaad
select and blends customised for different
regions.
How has ITC Foods been battling the threat of
private labels within categories such as staples
or chips?
Even overseas, where private labels have
higher penetration, these labels coexist with
branded products. As the market evolves, consumer
will seek value through both cost-effective
products as well as relatively premium ones. The
market is large and growing at respectable rates,
if not private labels we would see competition
from several other low-cost manufactures. Modern
retail remains an active partner for us.
