KRBL recently launched its ‘Swaad Samriddhi Ka’ campaign for its flagship product India Gate Basmati rice. The campaign is targeted at Maharashtra, the largest market for Basmati rice in the country with 13% of the overall contribution of in-house consumption here.
Kunal Sharma, Head of Marketing & Business Head, Modern Trade and Ecommerce, KRBL claims that while India Gate Basmati rice has a leadership position pan-India, in Maharashtra it trails behind the market leader, except in Mumbai where India Gate is at the pole position.
On the back of detailed consumer insights for the product, rice consumption, and packaging, KRBL made strategic changes in its product offering and packaging before the campaign launch.
Sharma says, “We're hopeful that this campaign will help us make significant inroads into that market. We've also ramped up our distribution in Maharashtra. In the last two years, we've seen a huge movement in terms of market share, to the tune of about 1,000 thousand basis points, which is huge if you look at the category. I think this campaign helps us drive consumer brand preference for brand India Gate in the state and strengthen our position going forward.” He adds, “We are looking at an aggressive gain in market share post and are measuring that consistently in terms of progress quarter-on-quarter. The second metric that we will definitely look at is the top-of-mind brand consideration scores. This campaign is intended to bring India Gate as a brand closer to the Marathi Manoos.”
This regional campaign is part of KRBL’s strategy to focus on regional markets based on their objective for the particular region. At a pan-India level, KRBL has put markets in three buckets – Maharashtra, the Hindi-speaking market including West Bengal and South. In the Hindi belt where loose rice is sold, the strategy is to drive consumers buying loose Basmati to packaged Basmati. In the South, KRBL commands a market share of 70%; however, the challenge here was that basmati rice is traditionally associated only with biryani thus capping growth. The strategy adopted was to drive consideration of basmati usage beyond only biryani and using basmati in the preparation of traditional rice dishes such as lemon rice, coconut rice etc.
With focus now on regional, there has a change in the media mix with investment significantly shifting towards digital and steadily moving up to about 25 - 30% of the overall marketing investments. Sharma shares that with the exception of metros, a large part of reach in non-metro towns - in South and West Bengal - will come through regional media. Sharma says, “The consumption of packaged basmati rice is growing faster in Tier 1 and Tier II towns with regional media playing an important role. You have to use regional media for reach in the non-metro markets. He continues, “We have pivoted in terms of our weeks of presence in the media. We've now extended our intent, in terms of media presence, to 32 to 33 weeks on air in a financial year. We are in the staples category which is a regular purchase and that reflects in the shift in our media strategy.”
Another move to strengthen regional presence been the launch of a range of regional rice products such as India Gate Ponni Raw Rice, India Gate Sona Masoorie RAW, India Gate Sona Masoorie RAW, India Gate Wada Kolam RAW amongst others. The share of basmati rice share in the overall rice market in India is very small while the regional rice space is a much bigger market with over 10,000 varieties of regional rice. Sharma, “Our play in the regional rice market is premium where consumers are willing to pay a premium for differentiation and a brand. We picked up South and Maharashtra as key markets to drive regional rice and are going about in a very staggered manner. For example, Bangalore is a focus market to build regional rice and our efforts have been largely focused on distribution and making our products available in retail stores. Going forward, we definitely look at activating consumer awareness campaigns around our regional rise also” He adds, “In the last financial year, we clocked about Rs 200 crores revenue from our regional rice portfolio and we see that scaling up much faster than the rest of the portfolio in the coming times. Building the Hindi and the South market is a long-term agenda, five to 10 years.”
KRBL had conducted extensive consumer research for two years with Landor, called ‘Educate and Empower’. On the back of this research, KRBL has revamped its packaging – after two decades - with the new packaging expected to be available on the shelves by January. With consumers traditionally buying basmati rice based on the price-point, the new packaging is an attempt to make the consumer navigation and choice easier. A campaign communicating these changes is scheduled for the fourth quarter.
While modern trade and e-commerce contribute 30% of KRBL’s revenue, it has been e-commerce, particularly, quick commerce that has grown at a disproportionate rate. With 70% of revenue coming from general trade, Sharma doesn’t see the significance of general trade diminishing due to its huge ecosystem and consumer reach. Sharma says, “We are actively ramping up our distribution in general trade. Packaged basmati rice is available in about 7 to 7.5 lakh retail outlets, against the universe of 1.2 crore retail outlets in India. So, there is enough headroom to grow general trade, which will help us grow our penetration. We don't feel that there's one channel which is more relevant than the other but at the same time, we see quick commerce scaling up very quickly in terms of revenue.”
Commenting on market share, he says, “Coming to market share, we work with one thumb rule. The thumb rule is that we aspire for our e-commerce market share to be higher than modern trade and modern trade to be higher than general trade. That's reflective of how strong our brand is. In the last quarter, we gained significant market shares in spite of our leadership position. We are further consolidating to about 300 - 400 basis points across channels - general trade, modern trade and e-commerce. From a market share perspective, we see our leadership position getting further strengthened in terms of our distribution expansion or our top-of-mind recall and brand preference.
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