Ready-to-cook brands storm Indian kitchens with customised flavours and health tag
The ready-to-cook (RTC) food segment has emerged from a fringe alternative to a complete home-cooked meal. A fast-paced urban lifestyle, rising disposable income and increase in the number of working women with an experimentative palate has powered the RTC market in India. The Indian woman today is looking at effectively utilising her time and looking for intermediate solutions to help her cook faster while reinforcing her role of the nurturer of her family.
According to a report in India Brand Equity Foundation (IBEF), the Indian food industry presently stands close to US $135 billion with a CAGR of 10 per cent. It is expected to touch US $200 billion by 2015. The total processed foods market size is Rs 1500 crore, out of which RTC’s market size is 600-700 crore (barring noodles) and is expected to grow around 20- 25 per cent over the next five years.
The range of products commonly referred to as RTC include 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).
Marketing Strategy and Growth
With a growing population of men and women busy proving themselves at the workplace, convenience has been driving the RTC industry in India. And marketers are trying for innovative ways to appeal to the customer interested in convenience cooking without cutting all corners.
One such brand, that has tried to bring in new flavours to match the customer’s need, is MTR - an established player in the FMCG market, which has also had the first mover’s advantage. Indian foods have a very localised and regional flavour and MTR understood this insight. Operating in almost seven food categories, MTR Foods has different marketing strategies for each category
Vikran Sabherwal, VP-Marketing, MTR Foods said, “All the products that we sell are not available throughout India and 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 customised according to that region's tastes. Breakfast Mix is a standard product that is distributed throughout the country and hence does not require any tailor-made marketing strategy.”
G K Suresh, Marketing Head, Foods Business, ITC says, “Today, the homemaker is taking on multiple responsibilities in and out of home. 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 offers that can help whip up everyday favourite dishes as there is 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.”
Suresh added, “Currently, the RTC category is relatively low on household penetration. Two factors are critical to driving adoption of this category. One is the ability to customise 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 specialise in diverse cuisine types. The second factor relates to 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 do not include any added preservatives.”
Being a new entrant in RTC category, soya food brand Nutrela has plans to increase sales to five-fold in the next five years.
Speaking about the importance of RTC and the group's strategy, Sandipan Ghosh, AVP-Marketing, Consumer Brands Division, Ruchi Soya Industries Limited said, “In today’s age homemakers and individuals are rushed for time when they have to pack tiffin boxes or lunch for their kids and and themselves. This is where the instant mixes and the RTC category plays a major role.”
Ghosh added, “Soya being rich in protein helps our brand’s offering to be unique. All homemakers want to balance taste, variety and health and Nutrela leverages this current trend with its new offerings of Ready Mixes like Soya Upma, Soya Kheer, Soya Dhokla....”
Nutrela’s communication has been around the concept of ‘Super Jaldi, Super Healthy’ driving home the proposition of convenience and health to consumers.
Desi tadka to the RTC products
While the aroma of fresh dosas, idlis, upma and stuffed parathas still rule the Indian home, MTR Rava Dosa and ITC’s Gulab Jamun Mix dominate Indian kitchens. However, for RTC and RTE (ready-to-eat) companies, overseas market is the money spinner.
Speaking on the importance of creating widespread consumer product trial 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 full-cream milk formulation or fully self-contained Masala Mixes from Kitchens of India which provide an instant gravy base for a variety of Indian dishes, our consumers have liked all our products. This is what gives us the confidence that we are in for rapid and sustained growth in this category.”
The RTC category is already sizeable in the four southern states and Maharashtra and growth is picking up across regions. Suresh believes that the industry is now poised for a higher growth trajectory with rapidly increasing household penetration, just as it has emerged as a huge market in many regions worldwide.
ABT Foods has a new range of instant mixes which includes Rava Idli, Rava Dosa, Rava Upma, Pongal, Payasam, Gulab Jamun and Badam Milk mix. Nutrela's latest offerings include Instant Soya and Ready Mixes, products expected to strengthen its leadership position in the market.
MTR Magic Kitchen Meal Mixes is the RTC category from the foods company which has variants such as Chana Masala, Methi Mutter, Palak Paneer – mostly North Indian fare and t breakfast mixes that include mostly South Indian options such as Oats iIdli, Upma, Multigrain Dosas etc.
Says Sabherwal, “In the masala category, 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 a number three player. In breakfast mixes, we are again the leaders with market share of 32.5 per cent.”
MTR spends 80 per cent on television, 10 per cent on radio, 5 per cent on print and 5 per cent on digital of its advertising money. Equal amount is spent on activation which includes trial generating activities like sampling.
Experts feel that as the number of childless working couples go up, RTC too will grow. They also feel the category is a heavy TV spender and expends little less but significantly on niche magazines. For instance, Vikatan Group has a dedicated food magazine Aval Kitchen, where the share of ad spends from this category has been constantly 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 this category. Our magazine was made as a special feature last year and it was a quarterly magazine. This year in July we made it a monthly and have created content that’s relevant to the reader as well as the advertiser. It has been much appreciated.” Some major advertisers include ITC Aashirvaad, Dabur Hommade, Sakthi Masala, Praylady etc who have signed long-term deals with the publication.
Ninan Thariyan, Vice President, Times of India, Chennai said, “Conventionally, RTC products use television as the primary medium. This trend is changing. They are open to avail print as well. 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. RTCs 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, and “India being more of a conservative market place, advertising is going to be crucial for brands to open up and reach out to the prospective customers. Since the RTC industry is more inclined towards women, they advertise more on niche and GEC and going forward they will also start considering news channels as an important medium.”
Consumer attitude drives the need and usage pattern in the RTC category. Apart from concentrating on the domestic market, these companies have also expanded their reach internationally in geographies with a sizeable Indian diaspora. Despite the buzz around digital, for brands that are in the RTC and RTE category, neighbourhood kirana shops will still remain the primary vehicle to carry these products.
Our typical marketing budget is usually 10 per cent of the topline spend