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There’s space for all to grow
Economic Times - 01 Feb 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.


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%. ITCFoods 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.

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