Case Challenge

Bingo! Mad Angles
July 2012

Instructions:
Registered Teams will submit a case analysis document comprising no more than 5 pages of single spaced, 12-point font (including illustrations and excluding TOC, Cover page). Along with the word document each team must submit a 10-slide presentation of the case analysis/solution suggested. There is no pre-determined structure to analyse the case. Participants are free to use any format which best illustrates and provides convincing arguments for their idea. Wherever necessary, the participants must make references to the sources of information and data. Case presentations will be judged based on identified criteria – the originality, creativity and uniqueness of the idea will receive the highest weightage; the implementability, sustainability and scalability of the idea; its fit with ITC’s vision and the manner in which it can leverage ITC’s strengths; the thoroughness of research, analytics and economic logic used to defend viability and execution of the idea. Last date for submission of case solutions is 7th August 2012. Teams must send their entries to the email ID provided for the campus. For full details please refer to the Interrobang Season 2 Case Challenge Brochure available with your Campus Point of Contact or contact interrobang@itc.in

As Marketing Chief for ITC’s food business.he was a fighter. Finally the announcement came ‘And the winner for the Most Innovative Marketing Campaign …goes to ……ITC for Bingo!. ITC’s snack food brand and its newest baby. Kolkata Indian Consumers in the eyes of manufacturers are almost like a “Bird of Gold”. Palace Towers. It is forecasted that Indian GDP is to grow at 7. Later in 2005 ITC successfully ventured into the wet snacking arena with India’s first Instant Pasta. ‘As crowded as Churchgate Station’. Marketing Head of Frito Lays India – the dominant market leader in the snacks market with 80% share. Keeping these perspectives in mind ITC Limited diversified into other FMCG sectors like “Food” and “Personal Care”. Mumbai Date:10th Oct ’09 (Yesterday) Satya looked around as he settled into his seat in the auditorium. as the crowd broke into applause. whispered Satya to his colleague. ITC entered the Food business in 2002 with brands like “Sunfeast” in biscuits (now India’s third largest brand).0% growth rate that India has seen in the last two decades. marketing campaigns and media strategies. boomed a deep-throated voice-over to the video which showed Mad Angles Ads and Mad angle packets in grocery stores occupying rack after rack. With an Urban population growing much faster than the total population it is expected to account for 37% of Indian population by 2025 vis-à-vis just a 26% in 2005. to remind them that they had to be at the Business Times Marketing Awards ceremony in exactly 45 minutes. a video on ‘Bingo! Mad Angles’ started playing on the big screen. This is for academic purposes only and is not intended to be copied or displayed or reproduced at any place outside the Campus. Location: The BT Marketing Hall of Fame Awards. ‘ITC has created a brilliantly innovative offering. and that they wouldn’t make it unless they left immediately. sitting to his right. when Satya’s secretary had interrupted. (much to Ramesh’s relief). Ramesh was the Brand Manager in charge of Bingo!. As Ramesh made his way back to his seat. Ramesh and Satya had been in the middle of an intense debate on how to increase ‘Bingo! Mad Angles’ market share. ‘Go on Ram. as the applause built into a crescendo. China & Britain. and the Who’s Who of corporate India in full attendance. Frito Lays counter-attacked. At the post ceremony cocktail party (Satya referred to it as ‘Air-kissing-fest Part II’). Just as Bingo! had begun to grab market share from Frito Lays and all market-research data had indicated that it was ‘set for take-off’. It wasn’t exactly his cup of tea. Satya and Ramesh bumped into Vivek. Ramesh stepped forward to receive the plaque and citation. Bingo! had been launched only two years ago. it's your big day’. with much fanfare and brilliant. Japan. clutter-breaking. “Aashirvaad” in staples (now India’s largest Wheat Flour Brand). someone who had worked his way to the top by wrestling with business problems and driving his team to deliver. behind US. 1 This Case is developed by and is the sole property of ITC Limited. in a daring bid to win market share in the Snacks market’. smooth logistics. TV commercials. Satya and Ramesh had redefined the market with snack-offerings in new formats and flavours through Bingo! Over the last two years they had worked together with feverish intensity on newer flavours. he muttered to his colleague Ramesh. This is expected to make India the 5th largest consumer market. It was a glamorous evening – red carpet.ITC Interrobang Season 2 Case Challenge : Bingo! Mad Angles Bingo! Mad Angles ITC Interrobang Case Challenge 20121 The early 2000’s at ITC Limited Headquarters. he had to make these appearances as part of ‘Good PR’. shaking hands and high-fiving people all the way. a few Bollywood starlets.3% for the next two decades against the 6. A heady cocktail of brilliant distribution. massive ad spends and Bollywood stars was all set to block Bingo! in its quest for market share. Minto and Candyman in confectionery (India’s largest confectionery manufacturer in the operating segment). .

The target was ‘locked in’. To this end an extensive consumer understanding study was instituted to gain an in-depth understanding of the varying preferences of taste & food and how these differed by region. i. or promises made to his friends. For a range of needs on snacking. Penetration levels (consumed at least once a week) declines by age group. said Satya. taste preferences differ and as a consequence even the food eaten is very different by state. a need that is quite well met by packaged snacks. Refer to Annexure 4 for key snacking trends across India The prime snacking occasions and the important needs to snack Snacking as the word suggest is highest during the evening. Ramesh was about to remind his boss that ‘tomorrow’ was Sunday. With increasing urbanization. However post 6pm snacking was mainly “Fresh and Hot” snacks. Thus the first step for ITC in designing its new Snacks brand was to understand the category of snacking from the consumer perspective. is in the need for mini meals prior to actual dinner times. please refer to Annexure 5 The consumer and ITC’s target segment Having arrived at the key “Need states” to be targeted it was essential to identify the core target profile for the category. Ramesh had seen that look before. “Jalkhabar” in East and “Morumoru” in South. It was found that Dry Packaged snacks were consumed more during 4pm to 6pm.ITC Interrobang Season 2 Case Challenge : Bingo! Mad Angles ‘Congratulations. He now had to figure out how to achieve it. Like most food categories snacking also happensprimarily “In home”. Habits differ (almost every few miles!). as he shook hands with Satya and Ramesh. Hence the need is to understand the peculiarities of snacking across regions. Let’s pick up that discussion tomorrow morning’. ‘Nice to see you in such a magnanimous mood’. There was however no gender bias in it. . Also considering the depth of consumption by individuals a consumption concentration curve was created which showed that the heavier “dry packaged snackers” belonged to SEC AB and were of 15-25 years of age. ‘I don’t mind you guys winning a few awards if that’s what makes you happy. gentlemen!’ said Vivek. It is highest in the 10-19 age group (almost 90%) and drops to 75% in the 26-35 age group. Something in his boss’ manner told him that Satya didn’t give a damn about Sundays. The world of snacking and changesin the recent past True to the diversity that India has. It was also found that a substantial section of tweens and youth consumes dry packaged snacks between 10 am and Noon. be it Tea time snacks (both morning and evening tea accompaniments) or mini meals which are as much huger quenchers as they are taste lures. Kurkure Desi Beats has also got a fabulous initial response’ Satya gritted his teeth. ‘Thank you’. ‘I'm off now Ram. Proportion of heavy users (4-6 times a week) also declines with age. and that he had promised to a get together for close friends.e. “Snacking” also has various regional lingo’s – like ‘Nashtha” in North and West. Vivek smirked as he helped himself to a handful of peanuts. Context: Between 2005 & 2007 at ITC Foods Division Headquarters in Bangalore and ITC manufacturing facility at Uttaranchal India is practically composed of many mini-countries in themselves – "the United States of India" as Satya likes to call it. I have a few market share trend reports on my desk in the office that make me happy. post 6pm in the evening – universal across different consumer segments. Snacking as a habit has existed in India over generations. Mobility also means the need for convenience. however significantly more than 1/4th of the consumption happens outside of home. Hence any product that needed to address such a large cross-section of people needed to be customized to try and offer a unique organoleptic experience to the target consumer. the consumer is far more mobile today and hence. A large study was conducted with over 2500 consumers across the country.

Bingo!’s shares had stagnated over the last few months and the Frito Lays decline had been somewhat arrested. Taste (through flavours) or shape / size. This led to the creation of Bingo! Mad Angles. Hence it was the "Perfect Snack" As an outcome of this prolonged & exhaustive research. ‘Reshma is on her way. So an original & innovative format came about. Not exactly the mood he wanted Satya to be in after Mukesh’s mail. she will take ten more minutes’ said Satya sipping on to his black coffee. thereby creating an irresistible combination. The innovation could be done along Product development vectors of Texture. The search hence began with basics – the hunt for a “differentiated product”. They were looking for something with a different shape and even with a larger size. A case in point would be the snack “Khakhra”. what Vivek had mentioned last night was indeed concerning. & youthful Today: pre lunch. Bangalore Ramesh woke up as the alarm went off at 7. He wondered if this was the silence before the storm. inspired from the Khakhra. The last evening had barely sunk in. but being westernized through the transformation of size. in a modern trendy and innovative format of a triangular product. In line with the platform chosen even the names given to the flavours like "Achari Masti" & "Tomato Mischief" were catchy. This is a popular snack option. trendy and a constant buzz value would lead to a success. which can take on multiple accompaniments such as pickles / sauces. The communication thought of “Perfect from all Angles" expressed in a light hearted manner was born out of this critical insight. Consumers slotted most of the existing flavours from the house of Frito Lays in the “Khatta Meetha” (Sweet & Sour) segment. Mukesh. Consumers also voiced the dissonance of having monotony in the shapes and sizes of the dry snacks which are currently available. Marketing Bingo! Mad Angles Core consumer proposition Bingo Mad Angles offered the consumers the familiarity of a "Habit" Indian Snack . shape and texture as well as the modern seasoning. Reshma . This was Frito Lays entry in to the triangular format snack similar to Bingo! Mad Angles which was the most accepted amongst all Bingo! snacks with a significant share of the finger snacks industry. but apt for a trip to the mouth. thanks to it crispy texture and a universal base. It was observed that consumers preferred a Sweet & Sour Taste over the rest of the “Indian” flavours. This also implied that badge value. Satya’s office. the ITC team identified a platform that cut across cultures & one that automatically elicited the interest of the youth – Humour. Please refer to Annexure 5 for flavour continuum. After all. Origin of Mad Angles Within the packaged salted snacks segment there was need to be differentiated. Of more concern was the launch of Kurkure Desi Beats. these thoughts crossed his mind as he clicked on the track ball to check the mail. a popular dry snack found in almost every household in the Western Region. The insight was to take a ‘Habit’ snack and try and tweak its construct to deliver a popular ‘Western’ snack. They found this kind of flavour to have a very high synergy with “Snacking” and compared it to some of the “Indian traditional snacks” like Vada Pav. He knew Mukesh was also in Mumbai city the previous day on a market visit. He looked out of his window to notice a quiet and peaceful Bangalore morning.in terms of flavour and texture. What had happened in Mumbai? Was this regarding Kurkure Desi Beats? Is there some other problem?. This is what he had always dreamt of. at ITC Foods Division Headquarters. Dabeli & Panipuri. It felt great when years of hard work gets recognized. Satya was visibly disturbed when Ramesh entered his office sharp at 9. whereas the existing traditional dry snacks were primarily in the Salty Zone.ITC Interrobang Season 2 Case Challenge : Bingo! Mad Angles This segment of “New India” youth was the core target segment for the category. He picked up his Blackberry and was surprised to find mails at mid night from the sales head.

Kurkure Desi Beats already had a new campaign with Kareena Kapoor as the brand ambassador. Limited or no advertising No merchandising in the form of racks Lower grade of packaging Distribution cost advantages account their regional approach A different qualityproduct Although discount players were small in size. In fact there was confirmed news of Haldiram. ‘Ramesh. However. Discount players. This was one of their attempts to change the game in the finger snacks market as well. A typical grammage comparison between discount and full price players can be seen in Annexure 2 The shares of discount players across the key regions and segments can be seen in Annexure 3 ‘Don’t worry Satya. bite size and flavour. . These players were largely dominant in the Western parts of the country where they controlled more than 50% of the market. Bingo!. This was a project which had been initiated by Satya a few months ago. with growing ambition. mouth feel. Ramesh wondered behind her reasons on calling on a Sunday afternoon. 3. 4. Lays was out spending Bingo! on a factor of 3. Reshma showed a number of slides which evaluated the product on a number of sensory parameters such as taste. Naina. we have made the Mad Angles product after years of research and the recipe is a closely guarded secret. She also wanted to discuss the Bingo! brand equity research. builds suitable product perceptions over a period of time. She concluded ‘Satya. It was no surprise that Satya had also called her in for the meeting. I had briefed Aziz and the results will be in by tomorrow’ responded Ramesh. but also other discount players like Balaji & Yellow Diamond had launched triangular shaped snacks in the market.ITC Interrobang Season 2 Case Challenge : Bingo! Mad Angles was the head of product development for ITC snack foods and had been closely involved with the brand since the last 2 years. I don’t think competition can imitate this product any time soon’ Satya & Ramesh got some confidence. Aziz. contributing to 27% of the snacks industry. This was Naina on the other line.. ‘Aziz. what about the product testing of Mad Angles versus Desi Beats’ quizzed Satya. his phone buzzed and he picked up the phone ‘Yes Ma’am’ muttered Satya. 1. ‘Thanks so much Ma’am. However. had been dominant only in the Potato chips part of the industry. they found it hard to ignore the lucrative finger snacks market. texture. they bought ‘brands’. had stayed away from using celebrities to promote the brand.. and we will certainly discuss the equity research with you tomorrow’ said Satya keeping down the phone. Just having a superior product will not suffice in this battle. a dignified and a sharp woman in her late forties was the Divisional Chief Executive of ITC Foods. Further. there were some pertinent concerns as well. another discount player dominant in parts of North. Frito Lays has not been able to match the product strengths of Bingo! Mad Angles’ said Reshma as she gulped down the last sip of her Elaichi tea. both also knew that consumers never really bought ‘products’. aroma. Just as he handed over the phone to Ramesh.. till now. Aziz informed that the first cut results had come in but the detailed report will be available only on Monday. The brand communication in most cases. Aziz had presented the results last week and while most things were looking fine. Not only Frito Lays. Ramesh knew that she was in the US for a business conference. one could not afford to ignore them. ‘Sir. especially in low involvement categories like snacks. Apparently Naina had called Satya to congratulate him on the BT awards. of launching a triangular shaped snack next month.. Ramesh picked up the phone to call the head of consumer research. In fact. Ramesh apprised Satya about Mukesh’s mails and that was enough to change the look on Satya’s face from one of disturbance to one of extreme concern. product superiority had still not been validated by the consumer. Discount players typically offer twice the grammage as full price players at the same price. Further. 5. 2 of the largest snacking markets of the country – Gujarat and Maharashtra were dominated by discount players. 2. I want to see these results TODAY post lunch’ said Satya keeping down the phone. They have significant cost advantages over the full price players’ account.5 : 1 in putting behind monies on advertising and promotions. till now. Knowing what Satya was about to instruct. ‘and Desi Beats is not up to the mark’. ‘ I have had an expert panel test the panel the whole of last week on all product parameters’ She continued.

South. all right. All the “me-too” products being launched by competition. How do we engage the larger masses to try our product? 3. they had indicated its great taste and mouth feel. Ramesh wondered when he would leave. his wife. But are these values enough for long term loyalty. consumers liked the brand on each and every aspect. Satya said. The brand was performing well across regions and was being perceived as being funny. looking somewhat comforted now. Mad Angles was a clear winner. . While the test had as many as 16 sensory parameters. Good. ultimately the consumer is looking for a great tasting product. The brand still appears slow in the South while it seems to have taken off in Non South markets We are funny and mad. There was a small celebration planned at home in the evening to celebrate the BT award but Naina’s call bothered him. Ramesh had not seen consumers providing such a positive response for any brand across the various brands even during his consumer interactions during the snacks U&A. head of planning at Ogilvy Bangalore. Ramesh quickly noted down “SOUTH” in bold on his notebook. particularly Desi Beats from Kurkure? b. How can we continue to maintain the loyalty of the existing franchise? 4. All these were the values which ITC wanted to instil the brand with. The Mad Angles equity study looked good. Very serious. discuss these with Reshma and let's move on to the summary of the equity study’ He said puffing away his favourite brand. on most of the metrics. The Discount players copying the format and giving additional quantities? 2. to take her through today’s discussions. contributed to only 18% of the industry. summarize the problem and work out the possible solutions to Satya's posers. still knew that things are very different when consumers consume a “Brand”. What should our response be to a.ITC Interrobang Season 2 Case Challenge : Bingo! Mad Angles Satya said ‘Ask Aziz to summarize the equity as well in our meeting post lunch. He thought of 2 women he needed to call urgently. In fact. West & South. on some of the critical parameters such as overall likeability and taste likeability. was very important for Bingo! as it contributed to more than 30% of Bingo! sales by value. On why consumers have liked Mad Angles. After all. its unique shape and some exciting Indian flavours. And Nisha. Put yourself in Ramesh’s shoes. Bangalore Biting on to a chip of Fiery Red Tomato. ‘OK. He had to discuss these results with Reshma the next day. Satya’s office. humorous & irreverent. although. Asha. "We have never communicated that gentlemen" Ramesh heaved a sigh of relief as Satya walked out of his room towards his car. Aziz closed his presentation with a summary slide. Aziz indicated that the product testing with the consumer for Bingo! Mad Angles versus Kurkure Desi beats had been very positive. ‘One of the problems of innovation is that we may get trials from the initial few but": 1. Post lunch. To summarize. All 3 flavours of Mad Angles were tested against both the flavours of Desi beats in 3 zones – North. at ITC Foods Division Headquarters. Satya. This issue was suddenly getting serious. He also asked Reshma to leave for the day. the brand was performing much better than the new brand launch norms. the get together later this evening had to be postponed.

ITC Interrobang Season 2 Case Challenge : Bingo! Mad Angles Annexure 1 Contribution by region for each format Potato Wafers All India (U+R) North Zone (U+R) East Zone (U+R) West Zone (U+R) South Zone (U+R) All % pertain to value shares **Finger Snacks examples: Kurkure. 36% 13% 29% 22% Finger Snacks 37% 17% 28% 18% Contribution within region by format % of PC 66% 24% 9% 20% 15% % FS 34% 76% 91% 80% 85% Value Growth of each format Potato Wafers 16% 6% 18% 17% 34% Finger Snacks 17% 14% 23% 16% 17% Annexure 2 Potato Chips grammage comparison of Full Price and Discount players Price Point Rs. Chataka Pataka etc. 5 Rs. 20 Annexure 3 Industry construct: Full price and discount players Full Price 13 Gms 26 Gms 59 Gms Discount 20 Gms 50 Gms 110 Gms Potato Chips 100% 80% 60% 40% 29% 17% 10% East West 71% 83% 90% 85% 63% 37% 15% 20% 0% All India North South Full Price Discount . Mad Angles. Tedhe Medhe. 10 Rs.

The largest Need Segment was “Time Pass”. Consumers in the West of the country have similar preferences as that of North but they favoured sticking to the “traditional” palate. Unlike the other regions preference for traditional flavours/dishes is the highest in South. snacks which give “Non Traditional Flavours” and also “International Brands”. Importance of packaged salted snacks at occasions when you are out of home and having a blast with family is also very low. . However in both the states synergy with packaged branded snacks were very low. This Case is developed by and is the sole property of ITC Limited. Consumers in the East of the country have fewer options in Snacking. also unlike North they prefer to consume more of “Local Dry Snacks” but have a trait similar to that of consumers from the North. Despite some behavioural similarities the Snacking Basket is very “region” based. Indian traditional hot & fresh snack dominated the space. they too show preference for non-traditional flavours. Annexure 5 Needs and Occasions of snacking: Although the time of day is relatively similar across consumer groups the need to snack was quite different. However if it’s a college going crowd and a simple date then packaged finger snacks might appear in the list. Snackers from the South are the most restrained set. Being out of home and enjoying the “freedom of youth” is an occasion when packaged branded snacks plays the role of an enabler. This need segment could also be further subdivided into “Physiological need” (Dying to eat) and “Psychological Need” (Pick me up). The highest set of repertoire consumption happens in the North followed by the West. Packaged branded salted snacks had a very high synergy with the platform of “Bonding & Time pass”. “Hunger” is another significantly large snacking need. Special occasions have an overwhelming role of “High Badge Value” and “Extreme Indulgence”. The smallest of need states was “Special Occasions”. They have a low preference for dry snacks. else again has a very low synergy. They also experiment with the least set of options.ITC Interrobang Season 2 Case Challenge : Bingo! Mad Angles 100% 80% 60% 40% 20% 0% All India 25% 75% Finger Snacks 81% 91% 86% 48%52% 19% 9% 14% North East Full Price Discount West South Annexure 4 Key snacking trends across India: Consumers from the North look out for Snacks which are “Hot & Fresh”. This is for academic purposes only and is not intended to be copied or displayed or reproduced at any place outside the Campus.

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