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HLL plans to top ice cream market

HLL plans to top ice cream market

Author | Source: Business Standard | Friday, Mar 30,2007 9:41 AM

HLL plans to top ice cream market

Hindustan Lever (HLL), the consumer goods behemoth, is realigning its strategy by entering new retail hotspots such as malls and multiplexes in a big way. The company is also set to launch its successful Asian ice cream brand, Moo, in the country this summer.

HLL’s initiatives come a dozen years after acquiring Kwality, the country’s ice cream market leader. In 2006, HLL, the subsidiary of Unilever, garnered Rs 137 crore in ice cream sales, which is a shade more than a tenth of the Rs 1,200 crore market. Amul, the dairy and ice cream brand of the Anand-based Gujarat Cooperative Milk Marketing Federation, claims to be the largest in the segment with 37 per cent share of the market.

The market potential is huge, with ice cream consumption in the country very niche, at around 500 ml per capita, compared with 2-4 litre in Singapore and an eye-popping 25 litre in the US.

HLL is seeking to capitalise on the growth, the signs of which are finally emerging, as consumers eat out more frequently and round off their dinner with cold desserts. Consumers have an ice cream within 10-15 minutes of taking the purchase decision. With a growth in sales of nearly 40 per cent in 2006 and with HLL making profits in the category for the second year in succession, the company is bullish. In this peak season, the company plans to offer its ice cream range as a “healthy pleasure food” for adults and “a wholesome and appealing option” for kids.

“It’s largely seen as a pleasure food,” said Sailesh Venkatesan, category head, ice creams, HLL. This season, apart from new launches and enhanced distribution strategies, the company also plans to ride on the large-format boom and cover all points where consumers seek pleasure. Tie-ups with large food chains are not ruled out, though the company executives claim that these are ongoing discussions taken at a global level. For other categories such as iced tea, the company already has tie-ups with PepsiCo through parent Unilever globally.

Moo, a vanilla and chocolate ice cream with high calcium content and fun packaging and shape, is primarily targeted at kids and fits in with the company’s strategy of getting the health message across through ice creams. Even HLL executives agree that consumer behaviour is changing. “With rising incomes, people are eating out more often. Indulgence is no longer a sin,” says Venkatesan.

Hence, the company is looking at a presence in out-of-home points such as restaurants by becoming a part of the menu. The other point of focus is being seen at malls and multiplexes where consumers seek pleasure. HLL is present with its kiosks branded Swirls, some with even seating arrangements in malls. The 30 Swirls offer value beyond the normal retail points by giving high value-added products such as special sauces, sundaes and so on. The company’s advertising strategy will be in sync to “tempt” consumers.

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