This action might not be possible to undo. Are you sure you want to continue?
Global Yogurt Franchises Attempt to Brand a Homemade Indian Staple
Published : June 28, 2012 in India Knowledge@Wharton
Plain, old-fashioned yogurt has always been a favorite with Indians. Better known by local names such as dahi and taire, it is a staple of the Indian diet. But it has traditionally been a generic product, with little differentiation between brands. Lately, however, globally popular variants like frozen and flavored yogurt are catching Indian consumers’ attention and palate. Take Red Mango, the U.S-headquartered frozen yogurt and fresh fruit smoothie brand. Launched in January in India, Red Mango is quickly growing in popularity. Here is a typical scenario: A young girl escorted by her father walks up to the Red Mango kiosk at an upmarket mall. She is handed a bright red paper cup to fill with as much yogurt as she would like from the vending machine. She adds two generous swirls to her cup and is directed to weigh the treat on a scale. The next counter offers a variety of toppings for the yogurt. “How many calories are there in a 100 gram serving?” her father asks the kiosk assistant. But he doesn’t wait for the reply. “It’s good any which way,” he tells his daughter as they walk away.
This is a single/personal use copy of India Knowledge@Wharton. For multiple copies, custom reprints, e-prints, posters or plaques, please contact PARS International: email@example.com P. (212) 221-9595 x407.
The Indian consumer with disposable income is turning to frozen yogurt as a healthy alternative to high-calorie desserts. And leading international players are fast moving in to tap into the growing market, including Red Mango, Canada-based Kiwi Kiss, South Korea’s Yogurberry, France’s Danone and Switzerland’s Nestlé. The Los Angeles-based chain Pinkberry is reported to be getting ready to enter India by the end of this year. Meanwhile, leading Indian brands such as Mother Dairy and Amul have also been expanding their yogurt portfolio. The New Delhi–based research and consultancy firm Technopak Advisors estimates the global frozen yogurt market at around US$75 to $77billion and growing at a compound annual growth rate (CAGR) of 15% to 18%. Of this, the U.S. accounts for US$11 billion and is growing at a CAGR of 10% to 12%. In India, yogurt is classified under the health and wellness food segment. Technopak estimates that in 2011, this segment garnered around US$2 billion in revenues. Over the next three years, it is expected to grow to US$5 billion. Pratichee Kapoor, associate vice president for food services and agriculture at Technopak, says the packaged yogurt market (plain and flavored) currently constitutes around 7% to 8% of the total health and wellness segment in India and was worth around US$150 million in 2011. It is growing at a CAGR of 18% to 20% and is poised to double in size by 2015. According to Technopak the ice cream and frozen dessert market in India -- which includes frozen yogurt -- was estimated to be at US$450 million in 2009-2010 and is expected to cross US$900 million by 2014-2015. A separate figure for the share of the frozen yogurt market was not available. A New Concept “The frozen/flavored yogurt concept is new for the Indian consumer, but it’s picking up fast and the processing giants are keen to capture the market,” notes Kapoor. She adds that consumption of this category is still at a nascent stage in the country. “It is estimated that in the year 2010, the per capita yogurt consumption was at 0.3 kilograms per annum in India compared to [per capita consumption of] 17.8 kilograms per annum in France.” Rahul Kumar, CEO of Maez One Group, who holds the master franchise of Red Mango for India, describes the brand as “India’s first authentic health-food quick service restaurant. The self-service concept where our customers have the liberty to serve as little or as much of their favorite dessert and
All materials copyright of the Wharton School of the University of Pennsylvania. Page 1 of 3
The Healthier Option Ameer Husain. the Indian operations of Red Mango have been growing at 55% month-on-month since the brand’s inception in January of this year. 72% of the India sales at present are from frozen yogurt. The café format will follow eventually. originated in Korea but now has its largest presence in the U. too. a new product specifically for Indian consumers. While Red Mango also offers low-calorie sandwiches.000 for marketing expenditures during this period. it was named as the leading smoothie and frozen yogurt chain in the U. including one in the city of Chennai that will mark Yogurberry’s first foray into southern India.” Red Mango. Cocoberry has seen 300% year-on-year growth and expects to generate about US$3.S. which entered India two years ago with its flavored yogurt. It is doing well. According to Kumar. In September 2011. The SEC A market refers to high consumption potential. Mumbai. Cremix is a stirred yogurt made specifically for India. head of marketing at Danone India. our target is to have 100 outlets across India. is also upbeat. “Steadily building on the insights on consumer preferences. By the end of the year.S.S. keeping Indian consumers and their palate in mind. the target is to open 130 new outlets across India. The typical Indian consumer in the cosmopolitan cities is leading a hectic lifestyle where a ‘meal-to-go’ is part of life. home-grown yogurt brand Cocoberry could offer international firms a cue to success. Ahmedabad and Jaipur. With increasing awareness around health among Indian consumers in recent times. Kumar plans to invest around US$1.” notes Swati Jain. or the socio-economic classification is a classification of households in India used to categorize consumer behavior. parfaits and gourmet waffles. are busy churning out new offerings. Mumbai and Bangalore by March of next year. the French company created Cremix. Launched in 2009. which is a 100% subsidiary of Danone Worldwide.S.Global Yogurt Franchises Attempt to Brand a Homemade Indian Staple: India Knowledge@Wharton (http://knowledge. founder and CEO of Cocoberry. “When we started. which currently has over 230 stores globally. In the next quarter. pointing to Junior Daheez and Fruit Daheez. Meanwhile. We are [seeing] demand from tier 2 cities as well. another five outlets are expected to be up and running. general manager for dairy at Nestlé India. “The positive consumer response [to the company’s flavored yogurt] inspired us to launch a new category for India. In September last year.” Nestlé has defined its target audience clearly. smoothies. The chain currently has 43 outlets across nine cities including Delhi. “India [has] huge potential in terms of growth. the brand felt that the time was right to enter the market.4 million to set up 10 to 15 Red Mango outlets primarily in the cities of Delhi. Take Danone.wharton. we have created a pipeline of yogurt concepts and the first from the new range have just been rolled out. “In five years’ time. Kumar says that India has been on Red Mango’s radar for the past few years.upenn. This is where we come in. Page 2 of 3 . Bhalla plans to unveil a new category of products. in Zagat’s 2011 national chain restaurants survey. He is looking at setting up 250 outlets across the country by 2015.cfm?articleid=4691) toppings is new to the Indian market and has been well received in our flagship store.” adds Husain.) All materials copyright of the Wharton School of the University of Pennsylvania. What differentiates Cremix the most is its unique texture and flavor. It is on the same lines as our flagship stores in the U. business head at RAASHA Leisure & Entertainment. Now I am very confident about the Indian market. He has earmarked around US$200. Nestle also has a range of real Fruit Yogurt. “The market for flavored yogurts is still very small and is starting to grow only now as more and more brands test themselves here. Cocoberry plans to open 25 outlets in Delhi and the National Capital Region and Mumbai.edu/india/article. the flavored and frozen yogurt category was completely new to the Indian market. families within the SEC A market with children between four to eight years of age. In the first quarter of this fiscal year. the area franchise for South Korean brand Yogurberry for North and East India.” says G. The demand from consumers is growing and we will expand Cocoberry’s footprint to more than 30 cities in the next two years. The brand is now looking to replicate its success story in India. (The SEC.” Next month.2 million in fiscal 2011-2012. “The idea was to create a niche premium product and we began by targeting people from the upper middle class and beyond. Other players. We are looking at a mix of kiosks and stores right now. These consumers are now very health-conscious and in search of healthier alternatives for a quick meal.” says Kumaran Nowuram. Bhalla.” Yogurberry has two outlets each in Delhi and Mumbai.
posters or plaques. There is a tendency to make frozen yogurt a lifestyle statement with parlors taking the lead. When a product is that ubiquitous. “We worked on this understanding to create Junior Daheez. This restricts distribution. Brand propositions that work in overseas markets will not necessarily work here. business head for dairy products at Mother Dairy. It had earlier launched probiotic curd and buttermilk.Global Yogurt Franchises Attempt to Brand a Homemade Indian Staple: India Knowledge@Wharton (http://knowledge. e-prints. To an extent.wharton. Harish Bijoor. this is a big disadvantage for yogurt marketers in this country.com P.” Bijoor suggests that the yogurt brands could draw a few lessons from the bottled water marketers who faced a similar challenge in India. “The key propositions that you tout need to be strong and need to exude and ooze value to the consumer. observers say. cents for a 100 gram pack. brand strategist and CEO of Harish Bijoor Consults and visiting professor at the Indian School of Business at Hyderabad. Bijoor points to another aspect. points to another aspect. The SEC A market refers to high consumption potential. is to offer consumers real fruits in their daily consumption of yogurt at affordable prices -. Out here. For multiple copies. vitamin D and protein. which received a good response from consumers. The product is a bit too generic and is made in every Indian home. please contact PARS International: reprints@parsintl. the going may not be smooth for all of the players entering the market. Ice creams claim a close relationship to dairy fat or vegetable fat equally. The idea. Two servings of this provide almost the same nutrition as one glass of milk. “It has been known as dahi for hundreds of years and finds dominant mention in our mythology with ‘Lord Krishna’ being the yogurt prankster of yore. All materials copyright of the Wharton School of the University of Pennsylvania.36 U.blueberry. The firm has now followed up with fruit yogurt in four variants -. the 35-year-old Indian dairy brand.” he says.cfm?articleid=4691) in India used to categorize consumer behavior. raspberry. there is a caste hierarchy. There are ice creams and frozen desserts. has also introduced differentiation into its yogurt portfolio.” Mother Dairy. “Yogurt in India is a generic item. there is a strong perception that ice creams are not necessarily healthy items on the menu for the future ….S. says Subhashis Basu. A big obstacle is the lack of adequate cold chain infrastructure in the country.” notes Bijoor. “In the ice cream market. it remains a commodity for a long time. Page 3 of 3 . (212) 221-9595 x407. mango and plum. Challenges Ahead Even as consumers seem to be interested in the new offerings. custom reprints. It is fortified with calcium.” Nowuram notes. Frozen and flavored yogurt brands need to crack this code in India.upenn.edu/india/article.) “Nestlé Junior Daheez is developed on the insight that mothers want healthy snacks for their children and also believe that yogurt is very close in nutritional equity to milk.” This is a single/personal use copy of India Knowledge@Wharton. which are important during the growing up years.
This action might not be possible to undo. Are you sure you want to continue?
We've moved you to where you read on your other device.
Get the full title to continue reading from where you left off, or restart the preview.