Kellogg India looking to enter snacks business in country this year with its Pringles brand
January 23, 2014
(Times of India)
– This year, breakfast cereal maker Kellogg India would truly mirror its parent company's portfolio by venturing into the snacking category with Pringles, a bolt-on acquisition by Kellogg Company in the US two years ago.
Bringing Pringles, an iconic American stacked potato chips brand, to India is not difficult for the company. The challenge for Kellogg India, which is trying hard to change the Indian consumer's breakfast habits to make it more "healthy", would be to market a snack product to the same consumer.
"We globally talk about our vision on two platforms of nutrition and health. Pringles is a great product from the taste standpoint. Health wise, my logic is very simple: Everything that's had in the right quantity cannot be unhealthy," Sangeeta Pendurkar, MD, Kellogg India, told TOI.
Pendurkar said the company would look at bringing Pringles to India this year. "We want to get into the snack category at some point," she said, without commenting on a certain market rumour about Kellogg eyeing an Indian snack company.
"We keep evaluating them from time to time," she said, when asked to comment specifically on whether Kellogg India was keen on acquiring an Indian snack company to bolster its portfolio.
Pringles was acquired by the $15-billion Kellogg Company from Procter & Gamble and the objective was to make Kellogg a global snack player by building on its snacking capabilities. Emerging markets in particular, of the order of $2 billion, are expected to become a larger platform for Pringles.
Pringles would once again pit the company against existing MNC rival PepsiCo in India. The two already compete in the Rs 700-crore odd breakfast cereal market, where it appears there's room for all. "The opportunity is great in breakfast cereals because penetration is low," said Pendurkar.
After struggling for 15-odd years in India, Kellogg has been growing at a healthy rate over the last five years or so. "We have been in the market for two decades but have seen a lot of momentum in the last five-six years in terms of behavioural shifts. Consumers are becoming far more health conscious now and disposable incomes have gone up as well," she said.
Awareness generation about breakfast eating, said Pendurkar, holds the key to unlocking the growth potential for the category. The company is banking on the fact that a large number of consumers (over 70%) skimp breakfast.
That apart, Kellogg is leveraging another consumer behavioural shift towards out-of-home consumption. It has started a unique pilot in a tie-up with Meru Cabs in Mumbai, where passengers travelling in a Kellogg-branded Meru cab are offered a breakfast package, which is free of cost at present. So it's a breakfast on the go. Going by the response, Kellogg is planning to roll out the scheme across India.
As for Pringles, the company will not have to struggle for two decades to get results. Snacking is intrinsic to the Indian consumption habit.
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