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INTRODUCTION................................................................................................... 2
OVERVIEW OF SNAKE INDUSTRY IN INDIA............................................................... 3
Consumer behavior .............................................................................................. 5
Indian consumer buying behavior analysis............................................................. 6
Market Universe................................................................................................... 7
MARKET PROFILE............................................................................................... 7
MARKETING ENVIORNMENT : Bingo........................................................................ 9
SWOT Analysis: Bingo...................................................................................... 10
MARKETING ENVIORNMENT : Pepsi Co...................................................................14
SWOT Analysis: Lay’s/Kurkure........................................................................... 14
Market Segmentation.......................................................................................... 17
Segmentation and Marketing strategies...............................................................19
MARKETING POSITIONING FOR Pepsi Co products...................................................21
Brand Management: Lay’s................................................................................21
Brand Management: Kurkure............................................................................ 22
Competitor Analysis:........................................................................................23
MARKETING POSITIONING FOR Bingo (ITC)............................................................27
Brand Management for Bingo:............................................................................ 28
CONCLUSION..................................................................................................... 30

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INTRODUCTION
I , as student of XLRI’s satellite course PGCBM-17, had prepared this
report as part of our term assignment for subject of Principles of
Marketing (POM).
This document explains the brand differentiation between PepsiCo’s
lay’s/kurkure and ITC’s Bingo.

While completing the assignment, we have analyzed consumer


behavior, particularly in snack industry segment, , SWOT analysis, and
marketing positioning.

As assignment is as per condition, we need to compare two brands,


falling under same product category. There two brands should belong
to local and international companies, respectively. Hence, we have
explored brands as, Videocon and Philips( Electronics),Tital and Swatz
(Watches), TATA Indica and Hyudai Santro (Car) and finally zeroed our
choice in Pepsico /s Lay’s/Kurkure as International brand, competing
with Bingo (ITC) as Indian brand.

Reason for this selection, is that launch of Bingo has triggered


competition in Tea time snack industry, which was dominated by
Pepsico. Within 2 years of product launch, Bingo has captured around
16% of marker share, posing big challenge to already established
market leader Pepsi Co. Bingo’s marketing strategies are being studied
in B-schools to study the consumer behavior and market positioning
techniques in Indian FMCG market.

We want to capture the techniques used by both brands to promote


their product in highly uncertain market as ready made snack industry.
We have analyzed market reports, studied advertisement campaigns
and brain stormed heavily within group members and outside market
people to prepare this report.

We hope that our effort reaches to fruitful conclusion and reader


perceive each word of the report.

Regds
Vadan Mehta

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OVERVIEW OF SNAKE INDUSTRY IN INDIA

Snacks are a part of Consumer Convenience/ Packaged Foods


segment. Snack is described as a small quantity of food eaten between
meals or in place of a meal. Snack food generally comprises bakery
products, ready-to-eat mixes, chips, namkeen and other light
processed foods According to the ministry of food processing, the
snack food industry is worth Rs 100 billion in value and over 4,00,000
tonnes in terms of volume.

Though very large and diverse, the snacks industry is dominated by


the unorganized sector. According to an Apeda survey almost 1,000
snack items and 300 types of savouries are sold across India. The
branded snacks are sold at least 25% higher than the unbranded
products. Savoury snacks have been a part of Indian food habit, since
almost ages. Though there is no particular time for snacks, normally
they are consumed at teatime. The variety is almost mind-boggling
with specialties from all regions, which have gained national
acceptance.

The industry has been growing around 10% for the last three years,
while the branded segment is growing around 25% per annum to stand
at Rs 5,000-Rs 5,500 crore, due to various reasons like Multiplex
culture, snacking at home while watching TV, pubs and bars (where
they are served free). AC Nielsen's retail audit shows that the large
sales volumes are due to a marked preference for ethnic foods,
regional bias towards indigenous snacks and good value-for-money
perception. Of course the branded segment is much smaller at Rs
2,200 crore, which is what makes it so attractive to food Companies
that are looking at bigger shares.
Growth rate of ready made snack (Potato chips/Namkeens) industry

Year Potato Chips/


Namkeens Growth
rate
1990-91 to 1996-97 5.2
1996-97 to 2001-02 7.9
2001-02 to 2006-07 6.3
2004-05 to 2009-10 6.5
2009-10 to 2014-15 7
Source: Ministry of Food Processing Industries,
GOI(www.CommodityIndia.com)

MAJOR PLAYERS

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In case of chips manufacturing, PepsiCo India is the market leader in


the country with 45% market share followed by Haldiram’s (27%). The
ITC, which has made a late entry in to chips processing market, has
managed to get a market share of 16% with its potato chip "Bingo".

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CONSUMER BEHAVIOR

The job of marketer is to meet and satisfy target customer’s


requirements and desires. “Knowing customer" is not a simple task.
Understanding the buying behavior of the target market for the
product is the essential task of the marketing plan. The job of the
marketers is to “think customer” and to guide the company into
developing offers, which are meaningful and attractive to target
customers and creating solutions that deliver satisfaction to the
customers, profits to customer and benefits to the stakeholders.
Marketers must study the customer taste, preferences, wants,
shopping and buying behavior because such study provides the clues
for developing the new products, price, product changes, messages
and other marketing mix elements.
Consumer has various type of behavior patterns. Few of them are
explained as follows;

Picking involves a random choice, here the buyer picks a brand from
the available brands, and is indifferent to the brand he buys. Picking
occurs when the consumer has (a) low involvement in the purchase, (b)
there is little uncertainty with untried brands and (c) there are few
differences between the brands (Assael, 1987).

Variety seeking, another example, also involves low consumer


involvement, but it requires significant differences between the brands
(Assael, 1987). Variety seeking was also found when (a) purchases are
made for more than one consumption period and (b) when the timing of
purchase and the timing of consumption were different (Simonson and
Winer 1992).

Impulse buying: Impulse buying occurs when a consumer experiences


a sudden, often powerful and persistent urge to buy something
immediately. It is more likely to involve grabbing a product than
choosing one.

Habitual behaviour: Habit generally forms when the consumers are


satisfied with the outcomes of the earlier purchases. Habitual buying is
characterised by absence of information search and evaluation of
alternate brands (Assael, 1987).

Extended problem solving: This occurs when the purchase is of


importance to the buyer. Assael (1987) found this process to occur
during the purchase of complex, high priced products where brands are

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perceived to be different and are associated with high degree of


uncertainty. Under the complex decision making, the buyer evaluates
the brands using choice criteria. Various types of choice criteria are used
to evaluate the different brands. O'Shaughnessy (1988) classified the
various choice criteria under technical performance criteria or generated
functions.

Indian consumer buying behavior analysis


Before nineties, most of Indians were in Picking or impulsive buying
behavior regarding the snack industry, as there was not many choices
around. I recall that during my childhood potato chips was considered
as Fasting Food( people used to eat during the day long fast, as per
Hindu tradition). After economic liberalization, multinational companies
such as Pepsi Co and Coke have entered into Indian FMCG market and
changed the equation. The major task to market items as potato chips
is to bring Consumer from Picking to Variety seeking and then to
Problem solving behavior, to change fasting Food to Fast Food 

Extended
Variety
Picking/Im Problem
Seeking Habitual
pulse Solving

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MARKET UNIVERSE
Market universe defines the targeted audience for the product. It is very
essential for marketer to target specified audience/consumers for the product
to keep the product away from picking buying behavior. For this product
should be positioned as brand differentiator to it’s competitors. Product
should bring some kind of functional/technical/others advantage to consumer
then it’s competitors.
In our example, following are the attributes that have impact on
consumer decision-making process, while buying snack product. ITC and
Pepsi Co have to study each of these attributes

1. Free from pesticides


2. Freshness
3. Good for health
4. Clean place of sale
5. Value for Money
6. Overall quality
7. Taste
8. Variety Products availability at same place
9. Seasonality
10. Flavor
11. Good display of products
12. Nearby Availability
13. Good ambience
14. Locally Produced
15. Packaging
16. Advertising
17. Personally known by shopkeeper
18. Shape
19. Promotional offer
20. Country of Production

MARKET PROFILE

Snack foods are impulse purchase products, and there is an element of


indulgence associated with them. It does not figure very high on the
shopping list. A consumer buys it only if it catches his eye at the outlet
or is accompanied by a child who finds potato chips a fun snack. So
leading players have stressed on attractive packaging and promotions
targeted at children to increase consumption. As these products are
general fun eat, brand loyalties are not strong and consumers look for

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novelty and new flavors. There is no notable difference in consumption


pattern across various age groups.
One of the major issues while defining taste parameter in India is its
huge geographical spread and culture diversity. Taste varies widely
across the regions. For instance in south India, banana chips are
extremely popular which do not find many acceptances in other parts
of the country. In north, Paaprichaat is very successful whereas in
Mumbai, Bata Vada/Vada Pao has been a runaway success.
Snacks like Chips, Namkeens are others are generally preferred for the
daily consumption whereas fun-foods like Cheeseballs and Twistys are
sold more in schools, Colleges, Railway Platforms and Movie Theatres.
Kids generally prefer Fun-Foods whereas all age groups generally
prefer Wafers and other snacks. Snacks are mostly consumed during
evening time.

CONSUMER PROFILE

The Indian consumers are noted for the high degree of value
orientation. Such orientation to value has labeled Indians as one of
the most discerning consumers in the world. Even, luxury brands have
to design a unique pricing strategy in order to get a foothold in the
Indian market.

Indian consumers have a high degree of family orientation. This


orientation in fact, extends to the extended family and friends as well.
Brands with identities that support family values tend to be popular
and accepted easily in the Indian market.

Indian consumers are also associated with values of nurturing, care


and affection. These values are far more dominant that values of
ambition and achievement. Product which communicate feelings and
emotions gel with the Indian consumers.

Apart from psychology and economics, the role of history and tradition
in shaping the Indian consumer behavior is quite unique. Perhaps, only
in India, one sees traditional products along side modern products. For
example, hair oils and tooth powder existing with shampoos and
toothpaste

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MARKETING ENVIORNMENT : Bingo


Marketing environment defines the external and internal forces that
has impact on product survival, acceptance and success in the market.

SWOT (Strength, Weakness, Opportunigy, Threat) analysis is a


tool auditing an organization and its environment. It is the first stage
of planning and helps marketers to focus on key issues. SWOT
Strengths and weaknesses are internal factors. Opportunities and
threats are external factors.

To define the marketing Environment, we have decided to carry out


SWOT analysis for Frito Lays and ITC’s Bingo as part of our assignment.

Introduction of ITC
Bingo is snack product from ITC (Imperial Tobacco Company of India
Limited ).
ITC is one of India's biggest and best-known private sector
companies. In fact it is one of the World's most high profile
consumer operations. Its businesses and brands are focused almost
entirely on the Indian markets, and despite being most well-known
for its tobacco brands such as Gold Flake, the business is now
diversifying into new FMCG (Fast Moving Consumer Goods) brands in
a number of market sectors - including cigarettes, hotels, paper,
agriculture, packaged foods and confectionary, branded apparel,
personal care, greetings cards, Information Technology, safety
matches, incense sticks and stationery.
Examples of its successful new FMCG products include:

• Aashirvaad - India's most popular atta brand with over 50%


market share. It is also present in spices and instant mixes.
• Mint-o - Mint-0 Fresh is the largest cough lozenge brand in India.
• Bingo! - a new introduction of finger snacks.
• Kitchens of India - pre-prepared foods designed by ITC's master
chefs.
• Sunfeast - is ITC's biscuit brand (and the sub-brand is also used
on some pasta products).

About Bingo
The Bingo brand of chips was launched by ITC on 14th March 2007
with an aim to capture at least 25 percent market share of the Rs 2000
crore branded snack market within five yrs. The launch is symbolic of

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ITC Foods' distinct approach of introducing innovative and


differentiated products in a largely undifferentiated market place.
Bingo’s launch was strategically timed around the World Cup. The idea
was to get the consumer to take that first bite.

SWOT Analysis: Bingo

SWOT analysis of ITC product Bingo is as following:

STRENGTH
Distribution
ITC leveraged it traditional businesses to develop new brands for
new segments. For example, ITC used its experience of
transporting and distributing tobacco products to remote and distant
parts of India to the advantage of its FMCG product as BINGO.

Experience
ITC has launched other FMCG products (Ashirwad Ata, Minto,
Kitchens of India ) and thus it has good experience of food market in
India, which can be strength for BINGO.

Skilled Resources
ITC has availability of master chefs from its hotel chains to develop
new food concepts and tastes for FMCG market. ITC has utilized these
skilled resources, to launch BINGO with various tastes.

Capital
ITC is a diversified company trading in a number of business sectors
including cigarettes, hotels, paper, agriculture, packaged foods and
confectionary, branded apparel, personal care, greetings cards,
Information Technology, safety matches, incense sticks and
stationery. Thus ITC had enough cash flow to launch and sustain, new
brand BINGO.

WEAKNESS
Cash Flow
ITC’s original business was traded in tobacco. ITC stands for Imperial
Tobacco Company of India Limited. It is interesting that a business
that is now so involved in branding continues to use its original name,
despite the negative connection of tobacco with poor health and
premature death.

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To fund its cash guzzling FMCG start-up, the company is still


dependant upon its tobacco revenues. Cigarettes account for 47 per
cent of the company's turnover, and that in itself is responsible for
80% of its profits. So there is an argument that ITC's move into FMCG
(Fast Moving Consumer Goods) is being subsidised by its tobacco
operations. Its Gold Flake tobacco brand is the largest FMCG brand in
India - and this single brand alone hold 70% of the tobacco market.
Dependency on Tobacco brand, may harm Bingo’s reputation as
FMCG product and has impact on cash flow.

Availability of raw material and season


BINGO is dependant of agriculture products as potato, rice etc.
Disturbance in supply of these raw products in time, will have bad
impact on BINGO production.

Organization Attention
ITC is big company with many division and product diversifications.
Thus it is hard for any ITC product to hold the organization attention
and commitment for long time.

International Standards
Being a domestic player, ITC’s Bingo is behind in understanding and
adapting international standards of food processing and marketing.

Price
While competing with local snack alternatives, Bingo price is high.

Brand Loyalty
Typically Indian consumer is having law brand loyalty for ready made
food products.

Law Fat Awareness


It is common belief that potato chips and related snacks are high
cholesterol food items. Increasing health awareness may keep
potential buyer away from purchase due to health consciousness.

OPPORTUNITIES
Growing Industry
The Indian FMCG sector is the fourth largest sector in the economy
with a total market size. Quoting the study by McKinsey & Co, a report
by the US Department of Agriculture stated "The market size for the
food consumption category in India is expected to grow from US$ 155
billion in 2005 to US$ 344 billion in 2025 at a compound annual growth
rate of 4.1 per cent."

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Untapped Market
Growing middle class and new life style in India, has created
opportunity for many FMCG products for untapped market.

Emerging India
Internet and TV media has increased the awareness of different world
culture and their food habits. Indian consumer is started looking for
new tastes and willing to pay bit extra price for that. Expanding Mall
culture, multiplexes and other avenues create new marketing
opportunities for snack industry.

Globalization
Increased global trade has opened door for domestic market to
international players and in same fashion triggered new opportunities
for domestic players as ITC for international consumer.

Brand awareness
Due to innovative marking strategies and available platforms for
advertisement (TV channels, news media, Commercial radio
channels), Indian consumer is slowly changing, his buying behavior
from seeking to problem solving. Brand awareness in FMCG
marketing is increasing.

Low Fat Inclination


Due to increasing health awareness, consumer is more inclined to
consume, law fat food items. Marketing products under Law fat
category, will increase the acceptance rate in market.

THREAT
Competition with Multinational brands
The obvious threat is from competition, both domestic and international.
Western companies will see India as an exciting opportunity for themselves
to find new market segments for their own offerings. ITC's opportunities are
likely to be opportunities for other companies as well. Marketing team of ITC
has stiff task to establish BINGO in highly competitive snack market, which
is dominated by multinational companies as, FritoLays. Due to high
investment and international experience of snack industry, Fritolays has
higher consumer visibility, brand value and market penetration.

Regional players
Regional players as Balaji Wafers, poses threat to Bingo’s market share due to their lower
prices. Regional brands have better knowledge of local taste and consumer behavior.

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Agriculture Dependency
As other FMCG products, BINGO is also dependant on agriculture raw
materials as potato, rice grains, chili etc. Irregular nature of monsoon has
always make agriculture market on mercy of rain god. A bad monsoon can
bring monstrous price hike in agriculture products which may have adverse
impact on FMCG market.

Internal Competition
ITC is a diversified company trading in a number of business sectors
including cigarettes, hotels, paper, agriculture etc. Thus if a particular
product of ITC, fails in achieving the required market share or change in
company’s business strategies, may end the life of the product. There is
possibility that BINGO is facing threat from other ITC products.

Prevalence of cultural taste brands


Regional Indian snacks such as Vada-Pao, Idli Sambar, Pau Bhavi, Bhajiyaa,
etc still have huge following and poses threat for Bingo.

Government Taxation
Heavy tax on FMCG products will bring price hike and hurt the sales of the
product.

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MARKETING ENVIORNMENT : Pepsi Co

ABOUT PEPSICO INDIA


PepsiCo established it's business operations in India in 1989 and has
grown to become one of the country’s leading food and beverage
companies. One of the largest multinational investors in the country,
PepsiCo has established a business which aims to serve the long term
dynamic needs of consumers in India.
PepsiCo India and its partners have invested more than USD1 billion
since the company was established in the country. PepsiCo India
provides direct and indirect employment to 150,000 people including
suppliers and distributors

PepsiCo's food division Frito-Lay is the leader in the branded salty


snack market and all Frito-Lay's products are free of trans-fat and MSG.
It manufactures Lay's Potato Chips, Cheetos extruded snacks, Uncle
Chips and traditional snacks under the Kurkure and Lehar brands. The
company’ s high fiber breakfast cereal, Quaker Oats and low fat and
roasted snack options like Aliva enhance the healthful choices
available to consumers.

About Brand Lay’s/ Kurkure:

Lays potato chips and Kurkure were launched in 1999 , as


'namkeen' snack. Kurkure is fully developed in India, has become the
torch bearer of fun and lovable human quirks. It developed an even
stronger identity through celebrity associations with Juhi Chawla [2003]
and Kareena Kapoor [2008], well-known actors in Indian Cinema, while
Lay’s potato chips is endorsed by bollywood star Saif Ali Khan.

SWOT Analysis: Lay’s/Kurkure

STRENGTH

Distribution
Pepsi Co has launched Lays potato chips and Kurkure in 1998. By that
time, Pepsi Co has already acquired Uncle chips, indigenous brand of
India and have strong distribution network of Uncle chips, ready for its
new brands.

Experience

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Pepsi Co is backed by vast experience in snack industry world wide. In


India, Pepsico had already launched Lay’s potato chips brand.

Brand Promotion
Pepsico’s Lay’s brand was endorsed by bollywood stat Saif Ali Khan
and thus had high visibility in market. Kurkure is endorsed by another
bollywood star Juhi Chawla to get the visibility and position as Family
Product.

WEEKNESS

White Space
Term White space is referred to area where parent organization has
never ventured before. Indian food market was white space product for
Pepsi Co.

Market Appeal
With Kurkure is promoted as law fat snack. It is uncertainty about Law
fat appeal’s credibility to traditional Indian consumer, for whom
Kurkure is made.

Availability of raw material and season


Being made by agricultural items as Rice, Corn etc., Kurkure’s supply
chain depends on irregular monsoon.

Price
Pepsico’s products are expensive the regional snack products due to
it’s high production and markeing costs.

Brand Loyalty
Typically Indian consumer is having law brand loyalty for ready made
food products.

OPPORTUNITIES

Changing life styles


Families have become nuclear. Double income earning families have
led to higher penetration of the snacks in food eating habits, packaged
ones though.

Globalization
Due to market globalization, Pepsico is operating in 55 countries.
Product such as Kurkure can be launched in other potential countries
as Shri lanka, Pakistan, Morrocco, Chili.

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Emerging India
Internet and TV media has increased the awareness of different world
culture and their food habits. Indian consumer is started looking for
new tastes and willing to pay bit extra price for that. Expanding Mall
culture, multiplexes and other avenues create new marketing
opportunities for snack industry.

Brand awareness
Due to innovative marking strategies and available platforms for
advertisement (TV channels, news media, Commercial radio
channels), Indian consumer is slowly changing, his buying behavior
from seeking to problem solving. Brand awareness in FMCG
marketing is increasing.

THREAT

Multinational Product
Being a MNC product, Kurkure has impact of relationship between host
and parent country. Bad relationship may have adverse impact on
Kurkure’s brand.

Government legislation
Any harsh government legislation/tax/policy change can disturb the
Pepsico’s products’ business case and profit.

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Market Segmentation

Indian market is highly segmented and divided. It is very difficult to


segment country such diverse as India. Following are the high level
market segment, used to define target audience of the product.

1. The Socialites
Socialites belong to the upper class. They prefer to shop in specialty
stores, go to clubs on weekends, and spend a good amount on luxury
goods. They are always looking for something different. They are the
darlings of exclusive establishments. They go for high value, exclusive
products. Socialites are also very brand conscious and would go only
for the best known in the market.

2. The Conservatives
The Conservatives belong to the middle class. The conservative
segment is the reflection of the true Indian culture. They are traditional
in their outlook, cautious in their approach towards purchases, spend
more time with family than in partying and focus more on savings than
spending. Slow in decision making, they seek a lot of information
before making any purchase. They look for durability and functionality
but at the same time are also image conscious.
They prefer high value consumer products, but often have to settle for
the more affordable one. These habits in turn affect their purchasing
habits where they are trying to go for the middle and upper middle
level priced products.

3. The Working Women


The working woman segment is the one, which has seen a tremendous
growth in the late nineties. This segment has opened the floodgates for
the Indian retailers. The working woman today has grown out of her
long-standing image of being the homemaker. Today, she is rubbing
shoulders with men, proving herself to be equally good, if not better.
Working women have their own mind in decision to purchase the
products that appeal to them.

4. India’s Rich

India’s rich can be categorized into five major categories as follows:

• The Rich

The rich have income greater than US$11,000/- per annum.


Total household having such incomes are 1,058,961. These
people are upwardly mobile. Some of them in this category are
Double Income No Kids (DINK) households. They spend more on
leisure and entertainment-activities than on future looking
investments. Across the category, backgrounds are distinctly

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middle class. They aspire, therefore, to attain the super-rich


status.

• The Super Rich

The Super Rich have income greater than US$22,000/- per


annum. Total number of households is 320,900. There are less
DINK families here than in the rich category. The Super Rich are
mainly professionals and devoted to consumerism. They buy
many durables and are status conscious.

• The Ultra Rich


The Ultra Rich have income greater than US$44,000/- per
annum. The number of households in this category is 98,289.
There is no typical profile of the ultra-rich. There are some DINK
households of middle-level executives. Some single earning
households are of first generation entrepreneurs. Some rich
farmers, who have been rich for a long time, belong to this
category.

• The Sheer Rich

The Sheer Rich is made up by households having income


exceeding US$110,000/- per annum. Such households are
20,863. They do not have a homogenous profile. There are
joint families as well as nuclear families in this category. They
consume services greatly. They own multiple cars and houses.
They aspire to social status and power.

• The Obscenely Rich

The Obscenely Rich is made up of households having income


exceeding US$222,000/- per annum. There are hardly 6,515
such households in India. They are first-generation
entrepreneurs who have made it big. Some of them are techies.
A variety of people belong to this category. They are just
equivalent to the rich in the developed countries. They crave for
exclusivity in what they buy. Most premium brands are relevant
to them.

5. Rural Consumer

About three quarters of the Indian population are in the rural areas and
with the growing middle class, specially in the Indian cities, the spill
over effect of the growing urban middle class is also felt in the rural
areas.

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Segmentation and Marketing strategies

There are high visible segments of Indian


society and there will be many more
segments present, given the vast diversity
of the country. Within above mentioned
segments, there will be sub category of
age groups, cultural inclination, gender
aspirations etc. Each market segment
requires to be addressed in
specific way. The attributes which, rich
rural consumer wants from product or
visual language which rural consumer
understand may not pitch the urban rich
in same manner. Marketer requires to
design different promotional campaigns
for various segments. F.eks Lay’s “What
Your Program” compaing was designed for urban youth,
and thus adverstisement locations were urban, (city Buss, college
Cantine), whike Kurkure’s “ tedha hei to mera hei” campaign was to
woo rural consumer and thus advertisement locations and language
was rustic.

It’s not just ad campaigns, but overall packaging should be segment


specific. F.eks. Bingo’s spicy (Masala) flavors, as RED chilli, Mad
Angles, etc.. are mostly packed in bright colors as RED, GREEN, to
symbolize spiciness of the product, while Bingos’ non-spicy flavor ‘
International Cream and Onion flavor’, packed
in sky blue color to symbolize the nature of the
product.

The major task for marketing products such as Pepsi Co and


ITC to market their product is to identify the market segment
for their products.

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MARKETING POSITIONING FOR PEPSI CO PRODUCTS

To gain the market share in Snack industry and position Frito lays’ food
products with brand differentiation, Pepsi Co has chosen Bollywood stars as
Saif Ali Khan and Juhi Chawla to endorse their products Lay’s potato Chips
and Kurkure, respectively.

Brand Management: Lay’s


TAG Line: No one can eat just one’
Pepsi Co has targeted rich/upper middle class urban youth, who has enough
money to buy bit expensive lay’s potato chips. To give the vision of Lay’s to
Indian consumer, Saif Ali Khan was selected for his boyish and boy-next-door
appeal. Image of Saif Ali Khan was mostly contributed by his landmark hit
film “ Dil Chahta Hei” as innocent, cute and charming youth. Pepsi Co’s
targeted audience , urban Youth, can easily identify themselves with Saif Ali
Khan. Inclusion of Saif Ali Khan in ad compaign give product as value for
money and position as brand differentiation then compititors.
On due course, cricketers as Mohammad Kaif and Mahendra Dhoni as well as
Bollywood stars Priety Zinta and Rahul Khanna, endorsed Lay’s potato chips
along with Saif Ali Khan.

Following are example, of year 2003, of Ad campaign, positioning


Lay’s as youth brand:

An opera singer is at the height ...a bored Saif munching his Lays His equally bored girlfriend

of her performance. But amongst comments, "Is aunty ne to saara replies that he could sing better,

an appreciative audience... mazaa kharab kar diya." and as he sees her eat the chips,

an idea strikes him.

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He walks up to the opera lady She can't help taking one more, Soon the stage comes alive as

during her break, offers Lays and but when he pulls back she she and Saif break into a Hindi

challenges her, "I bet you can't accepts defeat and asks, "What's film song and dance, the

eat just one." the bet?" audience joining in.

MVO: "Lays Australian cilantro Final shot of Saif with a pack of


surprise, no one can eat Lays, challenging the consumer,
just one." "Lagi Bet."

Brand Management: Kurkure


TAG Line: Tedha Hei par Mera Hei
Product wise Kurkure was more traditional then Lay’s. Pepsi Co wanted to
position Kurkure as family brand. While Lay’s was positioned to woo Indian
urban youth, Kurkure was positioned to attack upper middle class families,
both in rural and urban India. Juhi Chawla as senior bollywood actress was
best suitable for the role. Women and Men of age group of 35-45, can easily
identify themselves with Juhi. Juhi’s decent public image and cute acting
style, along with her age, perfectly satisfies the criteria for Kurkure.

Following are the example of Kurkure, positioning as family brand:

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Offering Kurkure to her guest Taking some, the unimpressed But in the next instant she says,

Juhi informs her, "Naya Kurkure." guest replies, "Sab kuch naya hi "Aur bhi mast banayala hai

hota hai." baap."

Her shocking style of speaking MVO: "Aila, naya Kurkure Red "...Masti bole to..." the old

creates a stunned response in Chilli Chatka, Masala Munch ab lady starts and Juhi completes,

others. extra chatpata, extra mast. "Kurkure." Super: "Masti bole

Taste aisa hatke zaban pe to Kurkure."

atke..."

Competitor Analysis:
Currently PepsiCo enjoys leader in organized snack industry with 45%.
ITC’s recently launched Bingo has decreased marker share of Pepsico
by 8 to 9&. Bingo is the closest competitor PepsiCo is having at brand,
product and market universal level. To counter the Bingo with it’s new
tastes and ingredients, forced Pepsi Co to indianized it’s brand,
Kurkure by lauching Desi Beats. Bollywood star Kareen Kapoor was
chosen to endorse the Desi Beats of Kurkure to position the brand
among Urban Youth, especially among teen girls.

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In a bid to take on its archrival ITC Foods, Frito-Lay India has opted for
a swadeshi branding strategy by launching ‘Desi Beats’, as part of its
flagship snack brand Kurkure’s brand portfolio.
With this move, PepsiCo is now directly competing with ITC Bingo’s
Mad Angles. “In appearance, Pepsi’s new brand ‘Desi Beats’ is an
exact replica of Bingo’s Mad Angle. It’s a clever strategy of PepsiCo to
gain market share in the highly competitive sector,” said an industry
analyst in Mumbai. With a shift in brand strategy, the market
dynamics will soon change in the branded snack sector in India.
However, imitation is not the best form of appreciation for ITC Foods.
For, the company is getting ready to launch an aggressive advertising
campaign, which will emphasis the originality of Bingo’s Mad Angles in
its communications. “Very soon, ITC Foods will launch its media blitz
which will talk about the uniqueness of the product which has fared
very well in the Indian market place,” informed key industry sources.
Currently, Ogilvy & Mather (Bangalore) is giving finishing touches to
ITC Foods brand new ad campaign.
Across the road, Frito-Lay India is fine-tuning its marketing strategy to
promote its new launch ‘Desi Beats’ across the country. To support its
high-voltage television campaign, Frito-Lay will be launching a host of
promotional activities which include radio advertising, outdoor
promotion and on-ground activities.
On the core advertising strategy for ‘Desi Beats’, Rohit Ohri, senior
vice president & managing partner JWT India said: “In our
communications, we have positioned the brand as ‘no fun with out
desipan’. To support the launch, we are rolling out a multi media ad
campaign featuring cine star Kareena Kapur.”
According to a spokesperson from PepsiCo, ‘Desi Beats’ is a new age
snack from the house of Kurkure, made by leveraging Pepsico’s
Technological know how, using Indian ingredients. “The product was
launched keeping Indian tastes in mind. Targeted at the youth
segment, it is an all new snack with a stylish Indian twist,” he added.
Now, the vital question is: Who will emerge as the winner in this battle
for market share

Report from Financial times, date: 27 Dec 2008

AD Campaign of Desi Beats, featuring, Kareen Kapoor to


counter, Bingo Effect.

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We see the story of Next shot, the evil Enters the fairy
Cinderella, being narrated stepsisters get ready for the Godmother(Ila Arun) and
in a Haryanvi accent. ball and leave the poor hands her a pack of Kurkure
Cinderella at home. Desi Beats.

Cut to, the ball where Enters Cinderella in a Desi VO: Kurkure ka naya Desi
everyone including the Avatar and spices up the Beats, firangi style mein
stepsisters are engaged in a ball with her dance moves. desi tadka.
boring dance.

The ad ends as Cinderella


chips in, "No Fun without
Desipann".

Major Promotional Campaign by Pepsi Co:


Sl. Brand
No Ad Campaign Brand Name Endorsement Year
1 no one can eat Lay's Potato chips Saif Ali Khan 20

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just one, Lagi


Bet 03
Saif, Preity
New Lays Chaat
2 Zinta, Rahul 20
street
Lay's chat street Khanna 05
“What’s the Lay's Mint Saif and 20
3
programme?” Mischief others 07
Chala Change Ka Saif, Juhi and 20
4
chakkar Pepsi Co Food others 08
Be a little Lays Indian Curry Saif and 20
5
Dillogical Masala others 09
Be a little Mahendra 20
6
Dillogical Lays I Dhoni 09
Kahani mein 20
7 Juhi Chawla
Kurkure Kurkure 04
Chai Time 20
8 Juhi Chawla
Achiever’s Award Kurkure 05
Teda hai par 20
9 Juhi Chawla
mera hai.” Kurkure 08
No fun without Kurkure Kareena 20
11
Desipan desibeats Kapoor 08
To iss Diwali Muh
Meetha kyun
10 Juhi Chawla
Kurkure karo na 20
bhai Kurkure 09

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MARKETING POSITIONING FOR Bingo (ITC)

As Pepsi Co has used Celebrity Power to position it’s products for


particular market segment, ITC has used totally different kind of
marketing strategy to launch it’s product Bingo.
Bingo is not endorsed by any Celebrity power or high technology.

Major Strategies Adopted by ITC for Bingo

1 Product - Assortment of flavours and eye catchy packaging.


• Bingo! positioned itself with its Indian flavors such as Tandoori
Paneer, Tikka, Spice Paneer etc.
• The segmentation was mainly done on basis of the age of the
people.
• The offerings under the Finger Snacks segment are unique and
innovative
Packaging
• ITC has done the packaging such that the product attracts the
buyer.
• It launched packs with different quantity keeping in mind the
specific consumer demand.

2. Price - Pricing Strategy


• Initial pricing of ITC bingo is a direct frontal attack on Frito Lays
with pricing of Rs 5, 10 and 20.

3. Place - Widespread availability at big and small retailers across the


country.
• ITC has adopted a Market Challenger strategy with the launch of
Bingo
• It has chosen a combination of flank and frontal attack against
the market leader Frito Lay’s.

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• ITC has made a strategic alliance with Future group


• The Company has distributed more than 4 lakh large racks, to
display the brand at all points of sale. The racks created so much
impact that even competitors like market leader Frito-Lays
introduced its own version of wafer racks

4. Promotions - T.V. Advertisements


• Bingo’s launch was strategically timed around the World Cup
• Within a month of the launch of the initial advertisements, 70%
of the viewers could recall the brand thus capturing a share of
the mind of the consumers
• Bingo's advertising follows the AIDA model
• No Brand Ambassador
• Comes in unique shapes for better recognition
• Brand recall along with 16 flavors

Due aggressive and well planned marketing statergy, Bingo has gained
the market share of appx. 16% in first two years. Market leader Pepsi
Co has been forced to launch product Desi beats to counter Bingo-
mania.

Brand Management for Bingo:


TAG Line: Great Combination, No Confusion

T.V. AD Campaign: Bingo’s launch was strategically timed around the


World Cup to cash in on the tremendous popularity that such leisure
and cocktail snacks would find among cricket lovers in the country. The
idea was to get the consumer to take that first bite. Not only the
flavours but also the advertising was supposed to have an Indian
touch. Within a month of the launch of the initial advertisements, 70%
of the viewers could recall the brand thus capturing a share of the
mind of the consumers. Brand recall along with 16 flavors in three
SKUs helped ITC to capture 16% of market share in just 18 months.
Bingo has managed to do a dent in Lays market share. Is the fact that
ITC spend close to 3 years researching, finding and analyzing the
Finger snack segment to come up with its own indigenous variety
responsible for Bingo's success
The 'insanity' in Bingo's promotion is a carefully knitted strategy that
was instrumental in Bingo's instant success. Marketing Guru's call it
"Disruptive Advetisement" This is one those cases where
advertisement/promotion has been the biggest factor in the success of

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a brand. The fact that ITC has a well established distribution network
has also helped it increase consumer interaction points.

The advertising strategy used humour to sell Bingo. Bingo!’s


advertising follows the AIDA model (Attention, Interest, Desire, Action).
The clutter-breaking ads with their slapstick humour and irrelevant
themes garnered enough eyeballs to create awareness of the product
and generate an interest towards the product in the minds of
consumers. The ads are simply insane & nonsensical to the point of
being bizarre & utter crap. And that is why they are so funny. This
resulted in high product trials. What’s interesting is the fact that Lays
uses a brand ambassador approach with the celebrities having mass
appeal such as Saif Ali Khan, Juhi Chawla & M S Dhoni whereas Bingo
has managed to do well without one. It still doesn't have an
ambassador.

On television, the company booked 10 to 15 spots per channel per day


on youth channels such as MTV and Star World, mass Hindi channels
like Zee and Star TV, and news channels. It also had around 20 spots
on a variety of radio channels and advertised in most leading national
dailies. In the top-30 cities, over 1,000 outdoor hoardings advertised
the product. According to industry estimates, ITC spent close to Rs 100
crore on marketing. The adverts which were full of humor, cheesy &
non-sense jokes, and relevancy with the brand helped in establishing
the brand Bingo. While I agree the theme of the adverts were
irrelevant from the product point of view, they were relevant and
totally associated with the brand image (which was also present in its
tagline - No confusion, only great combinations).
Following is the promotional example of Bingo, placing Comedy as
central theme.

With the help of all “GREAT COMBINATION, NO CONFUSION”


campaign, ITC finally tasted success in Bingo in 2008 when it
became a profitable business for the first time since its
launch in 2007.

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CONCLUSION
Feature Pepsi Co (Lays & Bingo
Kurkure)
Market Share 45% 16%

Distribution Strong Strong


Network
Organization core Food & Beverage Hotels & Tobacco
business
Brand Promotion Celebrity Power AIDA model, Disruptive
(Sail ali Khan, Juhi Marketing (hilarious)
Chawla)
Taste International/Tradit Mostly tradisonal
ional flavors flavors
Strength • Distribution • Distribution
• Experience • Experience
• Brand Promotion • Skilled Resources
• Capital
Weakness • White Space • Cash Flow
• Market Appeal • Availability of raw
• Availability material and season
of raw material • Organization
and season Attention
• Price • International
Standards
• Price
Opportunity • Changing life • Growing Industry
styles • Untapped Market
• Globalization • Emerging India
• Growing • Globalization
Industry • Brand awareness
• Untapped
Market

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• Brand
awareness
Threat • Multinational • Competition with
Product Multinational
• Government brands
legislation • Stiff competition
• Stiff with regional
competition players
with regional • Agriculture
players Dependency
• Agriculture • Internal
Dependency Competition
• Prevalence of
• Prevalence of cultural taste
cultural taste brands
brands • Government
Taxation

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