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Ready-to-Cook industry Poised for a 20-25 per cent growth over next five years

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Blame it on the fast-paced urban lifestyles, rising disposable incomes, experimental palates or the increasing number of working women in the country, the Ready-to-Cook food industry is on the upswing. The category has emerged as the next best alternative to a home cooked meal. The total processed foods market in India stands at Rs 1500 crore, out of which the Ready-to-Cook segment share is Rs 600-700 crore (barring noodles) and is expected to grow around 20-25 per cent over the next five years. (Figures Courtesy: IBEF)

Companies such as MTR, Gits, ITC, Bambino and Kohinoor Foods have played a major role in bringing this concept of ready-to-cook in India. Ruchi Soya Industries in the brand name Nutrela and Sakthi Group, Chennai based industrial conglomerate in the name of ABT Foods are the recent entrants to the RTC products category.

Marketing Strategy & Growth
The convenience factor has provided an impetus to the Ready-to-Cook industry in India over the past few years. Marketers are always on the lookout for ways to appeal to the customer and his evolving needs.

Vikram Sabherwal, VP-Marketing, MTR Foods

Vikram Sabherwal, VP-Marketing, MTR Foods

One such brand, that has tried to innovate with new flavours is MTR – an established player in the FMCG market, which has also had the first mover advantage. Indian foods have a very localised and regional flavour and MTR understood this insight. Operating in almost seven food categories, MTR Foods has a different marketing strategy for each.

Speaking about its tailored strategy, Vikram Sabherwal, VP-Marketing, MTR Foods explained, “All our products are not available throughout India. We ensure that each category is marketed differently. For instance some of our ‘masalas’ that are only available in the three southern states of Karnataka, Tamil Nadu and Andhra Pradesh are customized according to those states’ tastes. Each state has its own preferences and we introduce a customized touch to each product to give our customers the exact taste they are looking for. The Breakfast mixes is a standard product that is distributed throughout the country and hence does not require any tailor-made marketing strategy.”

The range of products commonly referred to as Ready-To-Cook (RTC) can broadly be classified as Dessert Mixes (Gulab Jamun Mix, Kheer Mix etc), Snack Mixes (Rava Idly Mix, Dhokla Mix, Puttu Mix etc) and Curry Making Enablers (Gravy Mix, Masala Mix etc).

G K Suresh, Marketing Head, Foods Business, ITC

G K Suresh, Marketing Head, Foods Business, ITC

G K Suresh, Marketing Head, Foods Business, ITC says, “Today, the homemaker is taking on multiple responsibilities in and out of home. Amidst all this, the role of the RTC category is to help her in ensuring that she does not miss out on the joys of cooking and serving her family delightful food. Our products are therefore designed to supplement her culinary expertise while taking the drudgery out of cooking.”

According to Suresh, there is a need for products that can help whip up every day favourite dishes as there are for occasional specialities. He says, “Our Aashirvaad brand offers a range of daily delights, while our Kitchens of India brand offers gourmet dishes perfected by the Master Chefs of ITC Hotels.”

Brands like ITC have understood the needs and psyche of the market and know what can drive adoption of these products.“Currently, the RTC category is relatively low on household penetration. Two factors are key in driving adoption of this category. One is the ability to customize products to the local palate and regional preferences, which ITC is able to do successfully since our products are created by the Master Chefs of ITC Hotels who specialize in various cuisines. The second factor is the need to proactively allay any apprehensions that the homemaker may have about the wholesomeness of RTC products. Our marketing communication is therefore also tailored to make consumers aware of the fact that all our RTC products are free of any added preservatives,” added Suresh of ITC.

Being a new entrant in the RTC category, the flagship soya food brand Nutrela has plans to increase sales about five-fold in the next five years.

Sandipan Ghosh, AVP-Marketing, Consumer Brands Division, Ruchi Soya

Sandipan Ghosh, AVP-Marketing, Consumer Brands Division, Ruchi Soya

Speaking about the importance of RTC and their strategy for it, Sandipan Ghosh, AVP-Marketing, Consumer Brands Division, Ruchi Soya Industries Limited said, “In today’s age all homemakers and individuals have a busy lifestyle and are rushed for time when they have to pack lunch for their kids and themselves. This is where the instant mixes and the ready-to-cook

category plays a major role in acting as a helping hand to these homemakers.”

Soya has been accepted wholeheartedly by health conscious Indians and hence Nutrela products hope to cash in on this wide appeal. Ghosh added, “Nutrela is here to deliver the authentic taste along with the dose of health in all offerings. Soya being rich in protein helps our brand’s offering to be unique. In this age all homemakers want to balance taste , variety and health and Nutrela leverages this current trend with new offerings of Ready Mixes like Soya Upma, Soya Kheer, Soya Dhokla etc.”

Nutrela’s communication has been around the concept of ‘Super Jaldi, Super Healthy’ which clearly communicates the combined proposition of convenience and health to consumers.
Ghosh also thinks that quality, consistency and communication is where the brands need to strike a chord. Nutrela also initiated experiential engagement programmes like taste trials across trade channels, RWA Activations and participation in various cookery shows. The brand is all set to reinforce its leadership position in this category by capturing over 20 per cent market share by 2019 in the ready-to-cook segment.

Incorporating Desi taste in Ready-To-Cook products
While the aroma of fresh home-made dosas, idlis, upma and stuffed parathas still rules many Indian homes, MTR rava dosa and ITC’s Gulab Jamun Mix have found a niche of their own.

Speaking on the importance of creating widespread consumer product trials to drive adoption, Suresh says, “Our key marketing focus is to get consumers to experience our products. Be it Aashirvaad Gulab Jamun mix with its delectable full-cream milk formulation or the fully self-contained Masala Mixes from Kitchens of India which provide an instant gravy base for a variety of Indian dishes, our consumers tell us that each of our products makes for a delightful experience. This is what gives us the confidence that we are in for rapid and sustained growth in this category.”

Pravin Menon, National Head- Ad Sales, Vikatan

Pravin Menon, National Head- Ad Sales, Vikatan

The RTC category is already sizeable in the 4 southern states along with Maharashtra and growth is picking up across other regions too. Suresh believes that the industry is now poised to witness higher growth with rapidly increasing household penetration, just as it has emerged as a huge market in many regions worldwide.

ABT Foods has new instant mixes which include Rava idli mix, Rava Dosa mix, Rava upma mix, Pongal mix, Payasam mix, Gulab Jamun mix and Badam Milk mix.

Some new offerings from Nutrela include Nutrela Instant Soya and Nutrela Ready Mixes, dependable items that the brand feels will strengthen its offerings.

MTR Magic Kitchen Meal Mixes is the Ready-to-cook category from the foods company which has variants such as Chana Masala, Methi Mutter, Palak Paneer etc – mostly North Indian fare and the breakfast mixes are mostly south Indian options such as oats idli, oats upma, multigrain dosas etc.

Sabherwal says, “Among masalas, two of the three markets that we operate in, we are the leaders with a 32 per cent market share. In Andhra Pradesh we have 16.3 per cent market share. In Tamil Nadu, we have just started so we are the number three player. In breakfast mixes we are again the leaders with a market share of 32.5 per cent.”

So how has MTR managed to create brand awareness and a high recall value? It could be attributed to a judicious mix of its marketing and advertising spends. MTR spends 80 per cent of spends on television, 10 per cent on radio, 5 per cent on print and 5 per cent on Digital. An equal amount is spent on activations which include trial generating activities like sampling.

Suresh expresses his faith in the visual medium, “When people start to see a brand on air they feel re-assured about its quality. This helps brands reduce barriers in entering the market.”

Division of marketing spends
Experts feel that as Double Income couples are growing in number, the ready-to-cook category will be on a growth path as people have less time to spend in the kitchens. They also feel the category is a heavy TV spender and spends little less but significantly on niche magazines. For instance, the Vikatan Group, a Tamil media group has a dedicated food magazine Aval Kitchen where the share of ad spends from this category has been consistently growing. Ananda Vikatan also has a set of food advertisers who advertise with them consistently.

Pravin Menon, National Head- Ad Sales, Vikatan said, “. We launched Aval Kitchen to tap into this category. Aval Kitchen was produced as a special feature last year and it was a quarterly magazine. This year in July we made it a monthly magazine and have created content that’s relevant to the reader as well as the advertiser. It has been well received. Our copy sale has been consistently growing and we have increased our visibility and B2C spends to reach out to a larger audience.”

Some of the major advertisers include ITC Aashirvaad, Dabur Homemade, Sakthi Masala, Praylady etc that have long term deals with Aval Vikatan. He added, “We create brand solutions for clients in our magazines and this has worked well for them, hence they have given us a long term commitment. This is in addition to their regular brand ads. For example, we came out with Aval Vikatan recipe booklet sponsored by Aachi masala, where we have a contest for readers within the booklet and this association has been there for more than 8 years now. We also created south indian recipes using Ruchi Soya as a base and distributed product samples with the magazine last year.”

Ninan Thariyan, Vice President, The Times of India, Chennai said, “Conventionally, RTC products use television as the primary medium. But today they are open to utilise print too. They prefer large format advertisements, such as full pages and power jackets. Yet another trend is their openness to innovative advertising like edit wraps, contextual placement of advertisements, sampling, fragrance printing and a host of other innovative options. RTC’s also work with print media increasingly on brand activation programmes.”

Talking about the medium of advertising that the RTC category has been looking at, Vinay V Sheshgiri, Vice President- National Sales, Asianet News Network said, “India being more of a conservative market, advertising is going to be crucial for brands to open up and reach out to prospective customers. Since the RTC industry is more inclined towards women, they advertise more on niche and GEC channels and going forward they will also start considering news channels as an important medium.”

Consumer’s needs and attitude play a crucial role in the Ready-To-Cook category and most players are contributing towards the development of the category itself. Apart from focusing on the domestic market, these companies have also expanded their reach internationally in geographies with a sizeable Indian diaspora.

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