Brand Updates – 26/10/2013

1) Consumer products maker Dabur to launch milkshake under the ‘Real’ brand

Consumer products maker Dabur will soon enter the packaged milkshake market by extending its juice brand Real into the Rs 500-crore flavoured milk category dominated by dairy product companies such as Amul, Vadilal and Parag Foods.

Real
The product, Réal Fruit Shakes, is being test-marketed in Delhi and Punjab, Praveen Jaipuriar, marketing head – foods at Dabur India said. It will be Dabur’s second dairy product after yoghurt, launched earlier this year. With increasingly health-conscious Indian consumers slowly moving from carbonated soft drinks to healthier options, flavoured milk represents one of the fastest growing segments in the dairy market. 

Read morehttp://economictimes.indiatimes.com/news/news-by-industry/cons-products/food/consumer-products-maker-dabur-to-launch-milkshake-under-the-real-brand/articleshow/24621049.cms

2) Fast-food chain Burger King to enter India with PE firm Everstone Capital

Burger King, one of the world’s top fast-food companies, will soon enter India through a franchising partnership with a company that will be headed by the present CEO of its UK operations and majority-owned by private equity firm Everstone Capital, a rare instance of a PE fund partnering with a fast-food chain. Everstone owns a controlling stake in Pan India Food Solutions, which operates a host of restaurants, including Noodle Bar, Copper Chimney, Spaghetti Kitchen and the local franchisee of US-based Coffee Bean & Tea Leaf.

fast-food-chain-burger-king-to-enter-india-with-pe-firm-everstone-capital

Burger King, which is famous for its signature Whopper sandwich, will be among the last big global food chains to enter India. Its arrival, ironically, will happen at a time its global rival McDonald’s is involved in a bitter legal battle with one of its franchise partners in the country.

Read more: http://economictimes.indiatimes.com/news/news-by-industry/cons-products/food/fast-food-chain-burger-king-to-enter-india-with-pe-firm-everstone-capital/articleshow/24679303.cms

3) Mukesh Ambani forays into chicken business, to take on KFC

Mukesh Ambani-controlled Reliance Industires plans to run an exclusive chicken restaurant chain in India in partnership with a UK-based company as he seeks a bite of the quick service restaurant (QSR) pie, which is pegged to grow at 30% per annum. The chain, to be called ‘Chicken came First’ will directly compete with KFC (Kentucky Fried Chicken), the world’s most popular chicken restaurant chain. RIL has picked up a 45% equity stake in Two Sisters Foods India (TSFI), which belongs to 2 Sisters Food Group (2SFG). 2SFG, the third largest food company in UK, supplies poultry, red meat, fish, and bakery and chilled/frozen products to the retail, food service and food manufacturing sectors.

Read more: http://economictimes.indiatimes.com/news/news-by-industry/cons-products/food/mukesh-ambani-forays-into-chicken-business-to-take-on-kfc/articleshow/24570492.cms

4) As smoking gets dearer, ITC bets on nicotine gum

The big daddy of cigarette business, ITC, is now gearing up to woo smokers with an antidote — Kwiknic nicotine chewing gums — to their “injurious to health” habit. In the process, the company is restructuring a dormant category, hitherto the domain of drug companies. The move by the maker of such popular cigarette brands as Gold Flake, Wills Navy Cut and Scissors is aimed at diversifying beyond traditional business which has become tougher in the face of excise duty hikes, anti-smoking campaigns and health concerns.

Positioned as an over-the-counter (OTC) product, ITC intends to exploit its strong retail distribution channel for the national roll out of Kwiknic. Pharma companies sell nicotine chewing gums largely through the chemists’ network – both as an OTC product as well as a prescription drug. ITC’s arrival will create competition for Johnson & Johnson’s Nicorette (US President Barack Obama’s favourite) and Cipla’s Nicotex and Nicogum in the Rs 20-crore Indian market — small, but growing at a whopping 43%.

The nicotine chewing gum is a popular and effective method of long term nicotine replacement therapy globally. The World Health Organisation has included it under the essential medicines list. In India, where about nine lakh people die every year due to diseases related to tobacco, the government has been ramping up efforts towards tobacco control. Gutka sale is banned in most states and taxes on tobacco products have been increased regularly to curb consumption. Kwiknic’s rollout is happening just two months before New Year’s Day when smokers usually “resolve” to kick the butt. Perhaps, along with ITC, smokers too can pin their hopes on Kwiknic.

Read more: http://economictimes.indiatimes.com/news/news-by-industry/cons-products/fmcg/as-smoking-gets-dearer-itc-bets-on-nicotine-gum/articleshow/24639954.cms

5) Cigarette makers launch smaller price packs to revive market

Top cigarette makers ITC and Godfrey Phillips have taken a leaf out of cola giants and FMCG firms’ book by launching smaller price packs to revive the market after volume sales fell more than 3% during April-September due to a sharp spurt in prices.

cigarette-makers-launch-smaller-price-packs-to-revive-market
ITC, which has more than 70% market share in the around Rs 35,000-crore Indian cigarette market, has launched shorter-stick variants of its popular brands such as Gold Flake and Navy Cut nationally, over the last six months after test-marketing such products in select states. The company has launched variants in both the sub-65 mm length, which attracts lower taxes, as well as 69 mm sticks, as compared to the usual 74-84 mm length.

“Consumers are down trading to the smaller size stick packs aided by the launch of newer variants under the popular brand names,” Nitin Mathur, consumer research analyst at Espirito Santo Securities, said. “These packs would play a significant role in ensuring volume growth for the cigarette companies impacted due to the massive price rise,” he said. Another factor pushing sales of small size cigarettes is the ban imposed on gutkha sales in 26 states and seven union territories. A recent survey by Edelweiss reveals that almost 38% of gutkha users have shifted to the consumption of cigarettes.

Read morehttp://economictimes.indiatimes.com/news/news-by-industry/cons-products/tobacco/cigarette-makers-launch-smaller-price-packs-to-revive-market/articleshow/24309904.cms

6) Cola giants gear up for rural slugfest

It has the potential to become one of the most fiercely fought battles in the history of Coca-Cola and PepsiCo India. After wrestling it out on urban streets, the world’s biggest cola majors are racing down the rural path for growth. Coca-Cola India has launched a programme to train dhabawallas in the basic skills of handling customers and managing eating joints. This comes close on the heels of its Parivartan training programme that helped build the retailing capability of nearly 1.8 lakh kirana storeowners. PepsiCo India, on the other hand, is focusing on quirky marketing campaigns and a more robust distribution model to woo rural customers. For the festive season, PepsiCo India is launching a talk-time promo offer that will give pre-paid mobile users in rural markets a unique opportunity to win free mobile talk time.

Data from the National Restaurant Association of India (NRAI) reveals that urbanizing double-income households , changing lifestyles and food preferences are driving the organized market for the “eating out” business segment , which is estimated to be at around Rs 78,000 crore but expected to reach Rs 1,68,000 crore in five years. For instance, according to the Directorate of Census Operations in Bangalore, about 3.5 lakh people in Karnataka eat out every day with the practice being more widespread in rural areas than in urban agglomerations — 0.6% for rural population and 0.5% for their urban counterparts in the state do not cook at home at all.

Read more: http://economictimes.indiatimes.com/news/news-by-industry/cons-products/food/cola-giants-gear-up-for-rural-slugfest/articleshow/24373958.cms

7) India Inc eyes villagers’ growing appetite for sweet

When a household moves beyond the regular grocery and soap buying to include chocolates and cream biscuits from the spare cash in their wallets, they are said to be moving from being ‘deprivers’ to ‘aspirers’ . Driven by a higher aspiration level, rural India consumers have now started adding chocolates and cream biscuits of the Oreo kind to their monthly purchase baskets in what is being seen as a dramatic shift in buying habits. Such products are broadly categorized by marketers as items of impulse purchase.

The propensity to spend on such products, marketing experts said, stems from the extra money rural folks are saving from the various government-led schemes, making them aspiring consumers much like their urban counterparts . It appears there is only a 10-15 % gap among the rural and urban consumers with regard to awareness about such products.

Both chocolates and biscuits are growing at very healthy rates. To latch on to the demand, leading chocolate maker Cadbury India is expanding into villages with 5,000-10 ,000 population in nine states and will establish a scalable and sustainable route to this market by 2015. The aim is to cover at least 75-80 % of the rural potential in the next two-three years.

Of the total Rs 5,500-crore chocolate market, rural India contributes about 16-17 %, while rural villages of population strata 5,000-10 ,000 contribute about 5%, which makes it a market of nearly Rs 300 crore growing at 19% CAGR for chocolates and 10% for creams. Interestingly , while the general perception is that rural consumers only buy small price packs of Rs 2, it turns out that maximum sales occur at the Rs-5 price point and Rs 10 is becoming the fastest growing price point.

Read more: http://economictimes.indiatimes.com/news/news-by-industry/cons-products/food/india-inc-eyes-villagers-growing-appetite-for-sweet/articleshow/24691520.cms

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One thought on “Brand Updates – 26/10/2013”

  1. A brand called “KwicNic” to target the smokers ? I would think something cooler sounding would be more appropriate. Also thedistribution channel may need to change to include the traditional cigarette channel else the same kind of volumes may not be possible to obtain. Given the increase in cigarette prices, Margins should take a hit sometime soon.

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