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F&B marketing – It’s all about Indianisation!
Monday, 17 May, 2010, 08 : 00 AM [IST]
Hasan Mulani, Mumbai


Food products often involve the general marketing approaches and techniques applied to marketing of other kinds of products and services.

In food marketing, topics such as test marketing, segmentation, positioning, branding, targeting, consumer research and market entry strategy are highly relevant.

In addition, food & beverage marketing in India involves other kinds of challenges – like dealing with a perishable product whose quality and availability varies as a function of current harvest conditions.

Dr C Thilakam, reader at JKK Nataraja College and Prof. K Nagarajan, lecturer, KSR College defined food marketing as “The chain of activities that brings food from farm gate to plate. It consists of a number of activities that makes a consumer bend his decision to buy a particular food product in its favour. Children are becoming consumers at younger and younger ages and a variety of influences and experiences shape their consumer habits.”

Today food & beverage processing, marketing and new distribution options provide increasing opportunities available to food marketers to provide the consumer with convenience.

In the old days, consumers might have baked their own bread from locally grown flour. Today, most households buy pre-manufactured bread, and it is estimated that the farmer receives only some 5 per cent of the price paid by the consumer for the wheat.

As far as organised food processors are concerned the concept of food marketing in India is essential for urban market, particularly Tier I and II cities. According to the Ministry of Food Processing Industries, the size of the Indian urban food market is estimated at Rs 3,50,000 crore, whereas the domestic market for processed food is huge and fast growing.

The size of the processed food market in India is estimated at $10 billion and is expected to reach $20 billion by 2014, while the share of packaged food in the food and grocery market is expected to touch 5 per cent by the same time.

The main categories of processed food are bakery products, canned/dried processed food, frozen processed food, meal replacement products and condiments. Some emerging new categories in this segment are processed dairy products, frozen ready-to-eat foods, diet snacks, processed meat, probiotic drinks and so on.

Further the ministry estimates that post-recession retail boom will create a huge demand for the food-processing sector in the coming years.

Budding Marketing Trends

F&B


Today life of an average person is changing constantly so also the marketing and selling techniques of food brands. Lifestyles are becoming fast paced and oriented towards convenience and on-the-go food items. This was noted by Shreya Pandey, food technologist and R&D, regulatory affairs manager of GSK, at one of the food conferences in Mumbai.

“Globally, beauty chocolate, can packaged spices, green water, green tea, tap-tea, beauty coffee, bio-flavoured chips, organic source, no junk and eco-friendly products are the current food and marketing trends. In the same way, the Indian food & beverage market, particularly processed food items, are also experiencing claims and innovations like omega3, pro-biotic, sugar free, low cholesterol, 100% vegetarian, gaining & losing weight, recyclable packaging and dietary foods,” Pandey said.

According to Pandey, competition, rising consumer demand, experiment and health awareness are the major drivers on Indian food & beverage trends. “People are more aware of the interplay between the food they eat and the role it plays in maintaining a healthy lifestyle. Broadly food & beverage marketing trends are alienated into health & wellness, on-the-go, variety & novelty and eco-friendliness,” Pandey added.

Health & wellness consists of claims and innovations like low fat, 100 per cent natural, no added flavours, rich in fibres/soya, antioxidants and others, whereas on-the-go food trends are collagen drinks, ready-to-cook & ready-to-eat, nutritional bars and liquid sweetener/vinegars and others.

Criticising Indian policies of f&b marketing, Satyendra K Kakkar, project coordinator – marketing, Haldiram’s, said, “Indian regulations and policies on food advertising and marketing are rigid not allowing to grow fast. We should rationalise and spur Indian organised players to vie with foreign players.”

On alcoholic beverages marketing practices in India, Raja Mukherjee, marketing head, Tilaknagar Industries, one of the leading manufacturers of Indian Made Foreign Liquor (IMFL), said, “In India, unfortunately for the IMFL sector there are huge restrictions on marketing and advertising. It is not a free play like FMCG and consumer goods sector. It has always been a topic of debate on lifting or easing of restrictions for the alcoholic beverages sector.”

“Our marketing strategy is more focused on below-the-line (BTL). On a continuous basis, we grab the attention of the consumer by doing a lot of ground events, innovative point of sale and others. We have a portfolio of over 50 brands in which we focus on advertising of around 10 brands,” Mukherjee added.

Hotel & hospitality marketing

On the latest marketing in the Indian hotel & hospitality segment, Deepak Advani, Enterprise Asset Management (EAM), F&B for Sun-n-Sand Hotel Pvt. Ltd, said, “Through the years we have built up our reputation with food service by innovation, new concepts, personalised service and progressive ideas. In foodservice and hotel segment, one has constantly introduce new products and innovative ideas on there menu’s and make use of various tools like advertising, cross promotions in restaurants to keep the guests informed of new happenings.”

“Nowadays we see food festivals to showcase culinary expertise in various restaurants from time to time. We at Sun-N-Sand Hotels maintain guest profiles which detail their likes & dislikes, do menu analysis to see what items are selling and not selling to understand guest preferences, go through all guest suggestion forms to find out how we are faring and where we can better ourselves. We train our staff in the development of brand strategies and initiatives of food service to make sure the guests who visit our restaurant get a complete dining experience,” Advani added.

Agricultural marketing

Science has allowed both for significant increases in productivity and for adapting products to market needs. For example, it is now possible to produce firmer fruits and vegetables that are less likely to be bruised or spoil in transit. (This may happen at some cost in taste, however).

Other research may be conducted to optimise tastes and appearances for one or more consumer segments. This research is often proprietary—sponsored by specific manufacturers and kept secret as a competitive advantage.

In India, an efficient marketing system can reduce post-harvest losses, promote graded processing, packaging services and food safety practices, induce demand-driven production, enable high value addition and facilitate exports.

Marketing reforms are needed, as they are critical to development of the potential urban food demand. The National Commission on Farmers, headed by Dr M S Swaminathan, has suggested encouraging public-private partnership besides encouraging private sector investments to tap this huge potential.

According to Mof
 
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