The Rs 125-crore Indian confectionary major, Candico, is seriously looking at re- entering the mint category. The company, having sold its Minto brand to ITC in 2002, is now trying to fill the void in that segment. Candico will be launching its mint candy under the XXX brand name next month.
The product would be launched with two SKUs (stock keeping units) – a jar containing 120 pieces and a polybag containing 100 pieces – informed, Madhav Gupta, Executive Director, Candico (India) Ltd.
Explaining the reason for the late entry in this category, Gupta, said, “We were present in this category earlier with the Minto brand. When we studied the category, we found that all the products were competing in the same brand space with little to no differentiation in product attributes or consumer offers. It was our strategic decision not to enter the category till we identified a definitive gap in the market as well as an USP for our product.”
The company did an in-house as well as external research before arriving at this decision to re-enter the mint category. Said Gupta, “We found that there was a gap in the market for a strong mint. Keeping in mind the current market scenario and the need for differentiation, we are going to launch our mint brand, XXX.”
Positioned as the ‘Xtra strong white mint’, XXX is targeted at teens and young adults. Candico intends to satiate the consumers by providing a strong flavoured mint. The candy will be available at 50 paise. For the launch of the product, the company would be offering a free pen from Today’s worth Rs 5 inside every Rs 60 jar, informed Gupta.
According to the company, the size of the domestic mint candy market for the organised sector was around 800 tonnes a month, while the unorganised sector would also have about equal tonnages. Candico has an 8 per cent share of the Rs 1,500 crore Indian confectionery market and plans to maintain that consistency this year as well.
Asked on the kind of growth that Candico was expecting its mint category to contribute to its entire product portfolio, Gupta said, “In the first six months of launch it would be unrealistic for this product to have percentage contributions to revenue, however, in the long term (around nine months), we believe that this product will be a 100 tonnes a month brand.”
As far as marketing plans are concerned, Candico will be resorting to both above the line and below the line activities. Besides, there would be a host of activities ranging from promotions in colleges and schools, hoardings put up at prominent locations, bus shelters and other merchandising, informed Gupta.
Candico wants to strengthen its international presence to 22 countries by October this year. As far as the domestic market is concerned, the company will lay stress on innovations and will extend their Loco Poco brand by launching a watermelon flavoured gum. “We will also be entering the functional benefits segment with the launch of a product that should be in the markets by June of this year,” said Gupta.
Among other things, Candico is looking at expanding its retail initiative (it is one of the first confectionary companies in India to launch a specialty candy retail chain), it has plans to have at least 50 stores by October 2006. “The candy retail chain is expected to contribute 25 per cent in the next five years to the total turnover,” informed Gupta.