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Product Category: Indian Snacks from Frito-Lays (PepsiCo)
Marketing Management I
Submitted to
Prof. (Dr.) Ashish Dubey
Submitted by
Group No 8 Sec F
Arnab Chowdhury PGP26329
Gaurav Bansal PGP26340
Naveen Kottala PGP26352
Rohit D PGP26363
Sushil Darveshi PGP26374
Vishnu M R PGP26385
Submitted on
18th December, 2010
Report On Marketing Management Project Page 2
Table of Contents Acknowledgement .................................................................................................................................. 3
Macroeconomic Environment in India and its effect on PepsiCo ........................................................... 4
Political Environment ......................................................................................................................... 4
Economic Environment ...................................................................................................................... 4
Social Environment ............................................................................................................................. 4
Technological Environment ................................................................................................................ 4
Legal Environment .............................................................................................................................. 5
Competitor Analysis ............................................................................................................................... 5
Industry Attractiveness (Porter‘s5forces) ........................................................................................... 6
Industry Attractiveness ................................................................................................................... 6
Bargaining power of suppliers ........................................................................................................ 6
Bargaining power of consumers ..................................................................................................... 7
Threat of substitutes ........................................................................................................................ 7
Market Structure ..................................................................................................................................... 8
Product Features.................................................................................................................................... 10
Product Hierarchy ............................................................................................................................. 10
Product Class ................................................................................................................................ 10
Product Lines ................................................................................................................................ 11
Product Type ................................................................................................................................. 11
Product Variants ............................................................................................................................ 11
Product Mix Analysis ................................................................................................................... 12
Packaging of a few brands ................................................................................................................ 13
Segmentation, Targeting and Positioning ............................................................................................. 13
Segmentation..................................................................................................................................... 14
Targeting ........................................................................................................................................... 14
Positioning ........................................................................................................................................ 15
Branding ................................................................................................................................................ 16
Brand Promise ................................................................................................................................... 16
Brand Naming ................................................................................................................................... 17
Differentiation strategies ................................................................................................................... 17
Major Brand Building and Promotional strategies............................................................................ 17
Pricing Strategy ..................................................................................................................................... 18
Conclusion ............................................................................................................................................ 19
Bibliography ......................................................................................................................................... 20
Report On Marketing Management Project Page 3
Acknowledgement
We are heartily thankful to our guide, Dr Ashish Dubey, who not only gave us
an opportunity to work on such an insightful topic but also extended his support,
guidance and encouragement from the initial to the final stages enabling us to
develop an understanding of application of the key marketing theories in the
marketing of Frito Lay‘s Kurkure and other snacks in Indian Market.
Group 8
Section F
Report On Marketing Management Project Page 4
Macroeconomic Environment in India and its effect on PepsiCo
PepsiCo gained entry to India in 1988 by creating a joint venture with the Punjab
government-owned Punjab Agro Industrial Corporation (PAIC) and Voltas India Limited
(owned by the Tatas). This joint venture marketed and sold Lehar Pepsi until 1991 when a
co-branding was necessary. However, post globalization, when the use of foreign brands was
allowed, PepsiCo bought out its partners and ended the joint venture in 1994. From then
onwards, Lehar Pepsi ceased to exist and PepsiCo started using its own brands.
Political Environment
Post globalization in India in the early 90s, PepsiCo bought the majority of the snack brands
in the market like Uncle Chips, Fun Munch Binnies etc. They chose to continue some brands
like Uncle Chips but did away with the others. They could go ahead with these acquisitions
as the incumbent government deregulations allowed them to do the same.
Economic Environment
In the eighties, the Indian populace had a cost-conscious mentality as far as snacks were
concerned. They would rather buy the local savouries than go for a packet of chips (100 gms)
which would cost around Rs.2 – Rs.2.5. However, post globalization, the disposable income
of the average Indian started increasing. As a result, people could afford ‗branded‘ snacks
instead of the locally-made ones at the ‗kirana‘ stores. PepsiCo took full advantage of this
and extensively promoted its snacks with an added price premium.
Social Environment
With the economic liberalization, society grew liberal as well. Now, people consuming
branded items were not considered pompous or show-offs. Rather, the trend for FMCG goods
started shifting towards premium and value for money from cost-consciousness. Thus, the
sales volumes of branded FMCG goods were increasing. Promotion became a primary
competitive tool which PepsiCo started excelling at.
Technological Environment
Product quality became a primary concern with the advent of technology. Whereas the local
brands had no quality check so as to speak, PepsiCo made sure that its snacks were made
with the state of the art technology with minimal human contact. The plant workers were also
garbed in protective clothing which made the contct environment highly sterilized. Snacks
Report On Marketing Management Project Page 5
prepared in unhealthy conditions could lead to Salmonella or E.Coli poisoning. Also, the
vacuum sealed packs of PepsiCo became the market standard replacing the local heat sealed
plastic packaging.
Legal Environment
PepsiCo took full advantage of the lack of Anti-Trust laws in India to acquire a large section
of the Indian Snacks industry. Nowadays, any shop would have PepsiCo branded products in
half of it snack product portfolio. By the time the laws were amended, PepsiCo had a major
head start in the market and continues to be the market leader today (by a large margin) in the
snacks category.
Competitor Analysis The Indian snack industry consists of both organized and unorganized sector with
total market size of Rs.4500-5000 crore. The industry is growing at more than 15-20%
annually. The branded segment accounts for Rs.2000 crore of the pie. Some of the major
players in the Indian Namkeen market consist of Haldiram Foods, Frito-Lay, Bingo, Parle.
The top namkeen brands in India are generally products offered by Haldirams and Frito Lays.
Synonymous with the salted snacks industry in India is Haldiram Food. Haldirams is known
for its large variety of to brands that have been ruling the Indian snacks industry for over
decades now. Consumers in India in a way have become accustomed to the products of this
particular brand.
The Indian snack market offers around 1,000 snack items. The market leaders of the namkeen
brands in India are Pepsi‘s Frito Lays that has a market share of 45%. It is being followed by
Haldirams that has a market share of 27 % and then follows ITC‘s Bingo has market share of
17%.
The prominent brands in India and their offerings are given below
Fig.1
Frito Lay
• Lays
• Kurkure
• Lehar Namkeen
• Cheetos
• Uncle Chips
ITC
• Bingo
Parle Snacks
• Must Bites
• Cheeslings
Other Players
• Haldiram
• Balaji Wafers
• Yellow Diamond
Report On Marketing Management Project Page 6
Industry Attractiveness (Porter’s5forces)
Threat of new entry
o As the market is growing at 15-20 percent annually, new entrants may consider it a
profitable venture
o As branded players are priced similarly, new players might penetrate by adopting a
lower price or by offering more grammage at the same price (Balaji-strategy)
o New players with a distinct USP and marketing strategy may find it easier to enter the
market (Bingo Strategy)
o Unorganized players still account for half of the total wafer segment, thereby
discouraging market entry
o Veteran players such as Frito-Lay, Haldiram etc enjoy economies of scale, well-
established distribution and good distributor relations.
Hence, the threat of new entrants is moderate.
Industry Attractiveness
Competitive Rivalry
o High Competition – Branded Players involved in cut-throat competition to increase
market share, entice new consumers, find new markets
o Low Quality differences among branded players.
o Quality difference between branded and unbranded offerings is offset by low price
offered by unbranded players
o Cost of switching is low as all players have a similar pricing strategy
o Brand Loyalty is high for branded players
Hence, the threat of competitive rivalry is high.
Bargaining power of suppliers
o Suppliers provide raw materials such as potatoes, spices and other ingredients. Their
ability to raise input costs is high.
o Higher cost of input commodities leads to lower margins, making the market unattractive
for distributors and retailers (in an already low-margin, high-volume market)
o Shortage of any input material may also affect production and thereby impact
distribution.
o Veteran players like Fritolay and ITC already have a well-established network of
suppliers.
ITC‘s e-choupal venture permits a steady supply of raw materials at the lowest price. Hence,
the bargaining power of suppliers is high.
Report On Marketing Management Project Page 7
Bargaining power of consumers
o Frito-Lay enjoys a healthy lead with a 45 percent market share for it‘s portfolio of
products
o Competitor differentiation is in terms of variants and communication.
o Ability to substitute is high as brands are priced similarly and distribution problems for
one brand promote sales for the other.
o Price Sensitivity is high. An increase in the price of Lays may promote a switch to Bingo
for most buyers (except for loyalists)
Hence, bargaining power of consumers is high.
Threat of substitutes
o Indian Snack Segment is high-volume, low-involvement driven (thrives on impulse buy)
o All snacks are considered to be substitutes of each other
Biscuits, Wafers and local snacks like Chakli, banana chips, farsan etc are all substitutes of
one another. Hence, the threat of substitutes is high.
Fig.2 Porter’s Five Force Analysis
Competitive Rivalry within
industry
(high)
Bargaining Power of
Customers
(high)
Threat of substitute product
(high)
Bargaining power of suppliers
(high)
Threat of new
entrants
(moderate)
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Market Structure
Fig.3 Market Structure
The India – specific snacks from the Pepsico stables, popularly dubbed as ‗Chai Time
Snacks‘ (Vernacular for snacks with tea-breaks) has taken the Indian consumers by storm
since inception. However, the success of the product can be attributed to the diverse primary
and secondary consumer research by the company across various regions in India.
The research yielded the following
o The Indian palate preferred strong, sharper flavours as compared to their western
counterparts
o There should be none or minimal Non-Vegetarian or perceived Non-Vegetarian
component (like onions, garlic etc.)in the snacks
o It should have a ‗yellow‘ tinge as the yellow colouration comes from ‗Haldi‘ or
turmeric, which is one of the primary seasonings used in Indian food.
o It should be ‗crunchy‘ for a long time after being taken out of the vacuum sealed
packets
o It should be a ‗lookalike‘ to commonly prepared snacks in Indian households.
In addition, it should not have some of the negative characteristics of Indian snacks like being
drenched in oil, fast rate of rancidity and lower shelf life.
•Frito Lay with 45% market share
Market Leader
•ITC’s Bingo with 17% market share pose threat to Lays through its direct frontal attack (strong distribution, advertising campaigns, large number of flavors)
Market Challenger
•Balaji
•Other local players catering to price sensitive, less loyal audience
Market Follower
•Parle Monaco’s Smart Chips has identified itself as a niche of the more health conscious segmentMarket Nicher
Report On Marketing Management Project Page 9
The product category that Pepsico had come up with adhered to the information obtained by
their extensive primary research. Their main products, in this line, were Lehar Namkeen and
Kurkure (in the beginning) and Aliva (added later).
The success of the products can be analysed as per the following criteria:
o Cultural Factors: The nomenclature of the early products had a fully vernacular
undertone. ‗Kurkure‘ means crunchy and ‗Namkeen‘ means salty snacks in Hindi. For the
semi-urban, non-urban population, the name itself had a fresh, crunchy connotation. The
colour of the snacks was yellow, with seasoning having a visual reminiscence of tangy
red-chilli powder.
o Social Factors: These products were targeted primarily to the young social groups. It was
observed that during social meets, the 15-25 age group category used a combination of
snacks and aerated soft drinks. Kurkure became one of their prominent choices. However,
the older age group segment (25 - 45 years) also began to consume Kurkure and
Namkeen as snacks with hard/soft drinks during informal social gatherings. Also, while
spending quality time with family while watching the quintessential cricket match or a
movie, these were the snacks of choice. The youngest target group (5-15 years) have
become a surprisingly big chunk of the consumers. They have a ‗pestering‘ factor to get
their parents to buy them the snack. Especially after Kurkure strictly adhered to prevailing
health standards (40% less Saturated Fat, Zero Trans Fats and No Added MSG), the
parents had less qualms about buying Kurkure for their children.
o Personal Factors: The brand personality of both the products especially that of Kurkure
denotes society, family and fun. There is no exclusivity or sophistication involved.
However, the commercials denote an aura of ruggedness. It reaches out to a plethora of
classes through it consumer engagement programs. Of the late, Kurkure has emphasized
on the ‗Family‘ aspect by extensively branding the concept of ‗Spend Time with your
family‘. It also has a high predilection towards the Indian values and lifestyle as portrayed
in its commercials. Thus, as per the positive consumer responses, it has positioned itself
as a ‗Fun family treat most applicable for informal social gatherings‘.
Report On Marketing Management Project Page 10
Fig.4 Position of Kurkure/Namkeen in the Consumer Involvement/Product Differentiation Matrix
Recent Product variations using Consumer Interface
Pepsico has diversified the product category further by introducing new flavours pertaining
to regional tastes like Funjabi Kadhai Masala (North India) and South Special (South India).
In line with the brand image, there are regular competitions where consumers are encouraged
to come out with variants of their own, which if ‗good‘ enough can be launched nationally.
This, we can say that this product category has a high consumer predilection.
Product Features
Product Hierarchy
Product Class
The product class here is Customized Indian Snacks produced by PepsiCo. PepsiCo has many
brands in the snack foods of which some are international brands such as Lays, Cheetos etc.
But of them some are available only in South Asia because they have been developed
keeping the Indian customer in mind. In other words they have a certain amount of functional
Car/
Jewellery
Fast Food/Snacks
KURKURE
NAMKEEN
Television/White Goods
Sugar/Salt
Report On Marketing Management Project Page 11
coherence. They are meant for a specific function: to cater to the needs of the domestic
market.
Product Lines
PepsiCo has three product lines in Customized Indian Snacks viz. Kurkure, Lehar Namkeen
and Aliva. These can be termed as product lines because they perform similar functions i.e
they are Tea Time snacks and they fall in similar price ranges (Rs.10-20)
Product Type
Only the Kurkure Product line has five product types:
o Kurkure (regular)
o Kurkure Desibeats
o Kurkure Extreme
o Kurkure Solid Masti
o Kurkure Mast Occasion
Limited editions of Kurkure were also available during occasions which also can be classified
as a product type.The other brands viz. Lehar namkeen and Aliva do not have product types;
rather than product variants.
Product Variants
Due to the plethora of various variants available for each product type/line they have been
tabulated below for easy reference.
Aliva Lehar Namkeen
Aliva Product Variants
Original Salted
Mint Flavour with Herbs
Tomato & Roasted Spices
Special Pindi Masala
Lehar Namkeen Variants
1. Aloo bhujia
2. Bikaneri bhujia
3. Navratan mixtures
4. Khatta meetha
5. Salted Peanuts
6. Karare Peanuts
7. Masala Peanuts
8. Mirchi peanuts
9. Nut cracker
10. Chatpata mix
11. Moong Dal
12. Cornflake mixture
13. Kaju Mixture
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Kurkure
Kurkure Product Types
Kurkure Regular Kurkure
Desibeats
Kurkure
Extreme
Kurkure Solid
Masti Special Edition
Masala Munch Deewana
Tamatar
Electric
Nimbu Masala Twists
Pujo
Special:Jhajhalo Hit
Naughty Tomato Dildaar Masala Risky Chilli Nimbu Masala
Style
Ganeshotsav
Special:Usal Pao
Chilli Chatka Flirty Lime
Green Chutney Rajasthani
Style
Hyderabadi Hungama
Tamatar Hyderabadi Style
Malabar Masala Style
Mumbai Chatpata
South Special
Funjabi Kadhai Masala
In addition to the above variants which have classified based on taste/material used/shape,
kurkure are available in various variants of prices. We take a brief look of such variants in the
price section of this report.
Product Mix Analysis
The following analyses have been carried out:
o Width of Product Mix of PepsiCo
o Length of Product Mix (average)
o Depth of Product Mix
The following table summarizes the above
PepsiCo India
Foods Beverages International
Brands
Customized Indian
Snacks
Health
Drinks
Soft Drinks Bottled
water
Cheetos Kurkure Gatorade Pepsi Aquafina
Lay's Lehar Namkeen Slice 7Up
Uncle Chips Aliva Tropicana Mountain
Dew
Quaker Oats Twister Nimbooz
Mirinda
As seen from above the width of the product mix is five (It has five product lines)
Average length of product mix = 17/5 = 3 approximately which is quite low.
Report On Marketing Management Project Page 13
Depth of Product Mix
This signifies the brand strength of a product. Depth of product mix is the number of variants
offered in a product line/type.
Kurkure is a brand characterized by high depth (19 product variants in total). This shows that
Kurkure is perceived as a strong brand by the company. Lehar Namkeen also has a high
depth with 13 product variants whereas the recently introduced Aliva is available only in 4
variants (nascent brand).
Packaging of a few brands
Kurkure
Kurkure is sold in an airtight packing and the packing is of high quality so that the contents
remain fresh for more than 6 months. Colors of packing material are chosen judiciously so
that the flavor becomes immediately identifiable in a store;
o Kurkure regular: Orange
o Kurkure tomato flavors: Red
o Kurkure Chilli flavors: Green
o Kurkure Lemon flavors: Distinct Gray etc.,
Kurkure orange is one of the most easily available flavors and has a distinct appeal. The
shapes of the contents are also printed to easily identify when other color packaging is used.
The words ‗Kurkure‘ are also written boldly to enhance visibility in a store.
Lehar Namkeen
This brand faces a fierce competition from Haldiram‘s and hence packaging plays a
significant role compared to Kurkure. Its individual brands such as Aloo Bhujia and Nut
Cracker are more familiar to a customer than the brand ‗Lehar Namkeen‘. Hence these are
more boldly printed. The packing follows the same quality standards as Kurkure. No
structural design innovations have been done with both the products. The only exception is
Kurkure mast occasion which is in the form of a box to facilitate gifting during occasions.
Segmentation, Targeting and Positioning
The snack food industry in India is highly fragmented, with the market dominated by made-
at-home snacks or savories sold by local vendors. Banana wafers, chaklis, samosas,
namkeens are few examples of large list of Indian snacks. The Indianised snacks made by
Pepsi Co such as Kurkure, Lehar Namkeen and Aliva have been very popular in the Indian
market since the time they were launched. Pepsi Co launched these products in order to enter
Report On Marketing Management Project Page 14
this market. These innovative products were specially designed keeping in mind the unique
tastes and life style preferences of the Indian people. In order to understand the market for
these products, we need to segment the Indian market on the basis of different variables as
follows.
Segmentation
Geographic: Indian consumer food habits are starkly different from their counterparts in the
European and American markets. Within India itself, people from each region have their own
unique taste preferences. The people in the southern part of India have a different taste as
compared to people in the northern or the western part of India. The market could be broadly
divided into four regions – north, south, east and west. It could also be divided into rural and
urban regions of India.
Demographic: Here we can divide the market using the following variables
o Age: children, young people, middle and old aged people
o Income level: high, medium or low income level
o Family structure: nuclear or joint families
Psychographic: Different people have different life styles and personalities which have an
impact on their taste preferences. Life styles include culture-oriented, sports-oriented or
outdoor-oriented. Personalities could vary from gregarious to ambitious to authoritarian
Behavioral: Market can be primarily divided on the basis of occasions like regular or special
(Diwali, Ganesh Chaturthi, etc)
Targeting
Different brands of Pepsi Co. such as Kurkure, Lehar Namkeen and Aliva have been targeted
at different market based on the segmentation described above. Now we delve deeper into
each brand‘s target market.
Kurkure: It primarily targets people of India and Pakistan all over the world and caters to
people of all age groups, gender and income levels. As far as background is concerned, it is
targeted at both urban and rural customers. Within India the different flavors of Kurkure such
as Funjabi Kadhai Masala, Chilli Chatka, South Special, East Parar Tok Jhal, Mumbai
Chatpata, Hyderabadi Hungama, Green Chutney Rajasthani snack etc have been specially
designed to target different regions such Mumbai (West), Kolkata (East), Rajasthan, Punjab
(North) and Hyderabad (South). When it was launched, it targeted mainly young people and
children but since then Pepsi Co. has also included families of any size in its target group. On
Report On Marketing Management Project Page 15
the psychographic basis, it targets both traditional as well as contemporary cultured people. It
is also targeted at people who are gregarious and fun loving as matched by the personality of
its brand ambassador Juhi Chawla who is known to be a gregarious person. Although it is a
regular use food item, during the festive season it also targets people who are looking to buy
gifts for families and friends.
Lehar Namkeen: It is targeted towards a more traditional market for namkeens which middle
aged and older people identify with. It comes in different flavors very much similar to the
traditional namkeens in India. It is aimed at people who do not mind paying a premium to
buy namkeens which are made from good quality ingredients. It targets primarily customers
in the urban India with rural India still preferring to go with the local namkeens. However
with smaller packs and different price points, it has a huge potential to increase its share in
the rural market.
Aliva: Aliva mainly targets young people who have a very active life-style. It is aimed mainly
at the contemporary, urban working class people who have busy schedules and tend to eat
non-healthy snacks without getting enough time to exercise. By introducing healthier
snacking options, Aliva is targeting those people who are short on time due to their busy
schedules and like to eat healthy yet tasty snacks to stay fit.
Positioning The various brands of Pepsi Co. in the Indianised snack category have been positioned
differently to cater to different target groups. We now delve deeper into the various brands.
Kurkure: It has positioned itself on the basis of its unique tastes, flavors, ingredients and
styles. It was originally positioned as a lighthearted fun, crunchy snack with a spicy flavor
and an unusual shape different from the usual potato chips. Since then it has changed its
positioning to more of a tea time snack competing with the traditional bhujias, biscuits,
chaklis, samosas and other snacks. It serves as a perfect combination with tea, coffee or
otherwise. It has now extended that concept to a snack which goes well anytime when family
members get together, whether over tea or just to share stories, jokes etc.
Lehar Namkeen: It is positioned as a great tasting, good quality and fresh snack that would go
well anytime anywhere with anything. It used the tag line ‘Taste zyada kyunki Oil taaza‘
which created an image of a snack made from fresh, good quality ingredients. It also
positions itself as a snack which is difficult to resist because of its taste. With its new tagline
Report On Marketing Management Project Page 16
―Khushion ka khazana‖, it positions itself as a source of joy and happiness for people eating
it.
Aliva: Aliva is the latest addition to the Indian snack category from Pepsi. It is primarily
positioned as a health snack for people who prefer to eat healthy, yet tasty and spicy snacks.
It is a significant step in the company‘s journey of portfolio transformation towards providing
healthier and tasty snacking options in line with local consumer needs.
Fig.5 Target & Positioning of Various Brands
Branding Kurkure was launched in 1999.It was a product fully developed in India. It managed to attain
successful position to identify itself as an Indian snacks brand in the minds of people. The
people identify it as a ―Chai time Snack‖ with flavours and tastes similar to home-made
snacks. While the Indian snacks market was clearly unfragmented with the market dominated
by made-at-home snacks or savouries sold by local vendors, Pepsi Lays Fritoff clearly sense
the need for a ‗portable, hygienic, ready to eat snacks which tastes Indian‘. Since its
inception, this strangely addictive snack has been a huge success among Indian consumers.
Brand Promise
“Kurkure is a crunchy new age namkeen snack brand which symbolizes light hearted fun‖ -
the brand promise that it offers to its consumers. Kurkure has constantly re-invented to keep
itself relevant to the Indian ethos, culture and above all Indian taste. To stay in tune with the
brand image it has, Kurkure comes up with‖ Kurkure Desi Beats‖ in various Indian Flavours
Report On Marketing Management Project Page 17
which is typical to different regions or states of India. Kurkure Desi Beats provide new range
of crunchy snacks offering Indian tastes using popular Indian ingredients like corn and wheat.
Kurkure continues to associate itself with Indian families through its various innovative
marketing and sales promotion strategies.
Brand Naming Kurkure is a hindi word which means ‗crunchy‘. The name goes well with its brand image
and marketing strategies. The name of the brand clearly communicates what it is all about to
the consumers – crunchy desi snacks.
Differentiation strategies
Flavor innovations, affordable price points and excellent customer connect through 360
degree communication approach has helped the brand enjoy iconic brand salience in the
snacks category. ―Launched as a national brand, it was a challenge for the company to devise
flavours that would appeal to regional taste buds. However, the focus on developing hot and
tangy flavours that suit Indian taste palettes has helped Kurkure to capture an Indian Snacks
brand image.To add to this, the company launched pan-Indian flavours like Masala Munch
and Red Chili Chatka and local specialties like Tamatar Hyderabadi Style and Green Chutney
Rajasthani Style. The Kurkure flavours draw inspiration from Indian spices and condiments
and are available in six bold flavours. In order to add further zing to its product portfolio, in
January 2008, the company launched Kurkure Xtreme, a limited edition variant in two
flavours—Risky Chilli and Electric Nimbu (lime). And this was its differentiating feature or
area of core competence. No other snacks brand in India is having a brand image which
Kurkure possess. It follows an image differentiation strategy in building its brand.
Major Brand Building and Promotional strategies
o ―Chala Change Ka Chakkar‖ was the largest ever brand promotional strategy
undertaken by Frito-Lay aimed at bringing all its flagship brands under one roof. This
massive umbrella campaign would allow chosen customers to live the life of a
Bollywood Indian celebrity for a day.It was launched in the beginning of 2008.
PepsiCo India has rolled out a fresh 360-degree campaign for its snack brand,
Kurkure, repositioning the "masti" co-efficient to a ―tedha" one. Titled 'Tedha hai par
mera hai', the new positioning statement salutes the average regular 'imperfect' Indian.
The new platform was based on the understanding that young confident Indian
consumers are no longer striving to be perfect in everything, but are comfortable
Report On Marketing Management Project Page 18
about their imperfections and quirks. The idea is to generate excitement around the
brand and have it stand out in the clutter of existing brands.
o ―Chai Time Achievers‖ – another Kurkure centric campaign was aimed at the
housewives in India. The Idea was to promote heavy audience interaction by sending
recipes for new flavours. The winning family would then have the opportunity to have
their photographs on one million Kurkure packs. The company adopted a direct
marketing campaign supported through television advertising and website. Using the
website as a strategic tool for promotion helped the brand appeal to a young audience
that spends a considerable amount of time surfing the web.
o Kurkure Express - Another novel branding initiative was a tie-up with South Western
Railways in India to have trains called the "Kurkure Express." These were special
trains that operated only during the holiday season. The brand was featured on
reservation charts, coach indication slips, and during any announcements about the
train. This outdoor media was a unique way to target families who travel by train
during the holidays.
o Kurkure engaged great deal of celebrity endorsements for its marketing campaign.
Aside from Juhi Chawla, the company also signed on Kareena Kapoor for the ―Desi
Beats‖ version of Kurkure.
Pricing Strategy The customers of Indian snacks industry are not very price sensitive on the other hand they
are more taste and quality conscious. As this market is driven by high-impulsive buyers of
snack foods, there is very little dichotomy in the pricing strategies of all major players.
Generally companies follow value for money or premium pricing strategies for this product
category. However, new entrants like bajaj is targeting the price sensitive consumers and
using the low price strategy.
The core portfolio of Frito Lays is pretty evenly split between entry-price points (Rs.3 and
Rs.5) largely consumed by lower SEC on-the-go consumers, single serve packs (Rs.10) and
large take-home bags (Rs.20). The consumer is more value-sensitive and functionality-driven
in some parts of the country like the West.
The company has been nimble in pricing and productivity in the face of input cost volatility.
For example it took up pricing through weight-outs across the portfolio to cover
Report On Marketing Management Project Page 19
unprecedented commodity inflation in the second half of last year. Commodity prices
softened in the first half of this year and they put back grams in brands like Kurkure.
The pricing of its different products are as follows:
Brand SKU size Price
Lays
100gms Rs.20
35gms Rs.10
15gms Rs.5
Uncle
chips 35gms Rs.10
Aliva 60gms Rs.12
Kurkure
19gm Rs.5
38gm Rs.10
75gm Rs.15
Aliva which is a recent launch is priced at Rs.12 which is much above its competitors
by positioning itself as taste with health. The price of competitors are somewhere near
Rs.7 and Aliva is charging premium on its product as the taste with health strategy is
not much used by the competitors.
With entrant of no. Of small players entering into this category and providing snacks
at low cost Pepsi co has decided to stretch the equity of Lay's and Kurkure with low
unit price packs at Rs.5 and Rs.3; ensuring that occasional consumers don't
downgrade by monitoring the price-value of these brands; and using flanker brands
like Uncle Chipps and Lehar namkeens to target this growth opportunity
The other products like uncle chips and Leher namkeen are also using the value for
money pricing strategy but the company has priced slightly above its competitors by
delivering the nutritional benefits to its customers.
Conclusion The Indian snack industry is growing at a tremendous rate of 15-20% and every major and
minor player in this market wants to grab a share of this. More and more companies these
days are developing products especially for the Indian consumers taking into account their
unique lifestyles, backgrounds, culture and preferences. As people of India get more
connected with the rest of the world, more international companies would like to cater to this
market with innovative products.
The market is unattractive for players who
o Aim to be a me-too product with no significant differentiation
o Do not have a well-established distribution network
Report On Marketing Management Project Page 20
o Do not have good supplier and dealer relationships
However, if one can develop a product for a niche segment, the entry to this market
may be profitable.
The consumers have taken to this product category quite favourably. Aside from the
initial target market, the ambient target market has expanded to encompass a wider
age group although the product positioning for each is different.
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