NEW DELHI: Maggi instant noodles, foods major Nestle’s flagship brand that has dominated the Indian instant noodles market for nearly three decades, is losing market share on a monthly basis to newer entrants such as GlaxoSmithKline’s (GSK) Horlicks Foodles, Hindustan Unilever’s (HUL) Knorr Soupy noodles, Big Bazaar’s Tasty Treat, Top Ramen and several other smaller players, according to data by market research firm Nielsen.
The data shows that Maggi’s share of instant noodles, on an all-India basis, across urban markets, has slipped consistently between December ’09 to July ’10. While Maggi instant noodles (minus vermicelli) had a 90.7% share in December ’09, the share dropped to 86.5% in July ’10 on an all-India basis.
A regional split of the data shows that Maggi's instant noodles' value market share has fallen across the east, south, north and west zones for the same period.
Analysts say with new competition, Maggi’s market share is certain to get impacted , but add that Nestle has the potential to expand the Rs 1,300-crore instant noodles category – which itself is growing at a rapid 15% annually. A detailed email sent to Nestle on Thursday elicited no response.
Apart from HUL and GSK which have positioned their noodles as ‘healthy’ snacking options targeting kids and mothers, others like Indo-Nissin’s Top Ramen, Capital Foods’ Ching’s Secret and CG Foods’s Wai-Wai , though around for long, are stepping up marketing efforts to take advantage of category growth. Besides, private brands like Big Bazaar’s Tasty Treat and Aditya Birla Retail’s Feasters are notching up share.
Manoj Menon, FMCG analyst at brokerage firm Kotak Securities, wrote in a report earlier this month: “Maggi faces product substitution risk and brands like Knorr and Foodles could potentially impact its incremental growth. Nestle faces a challenging competitive environment in culinary.”
GSK, which entered the category in December last year, has taken away share from Maggi mainly in the South and East riding on the equity of Horlicks and its well-entrenched distribution in the regions.
GSK’s executive VP, marketing, Shubhajit Sen, said: “Consumers were looking for a choice in instant noodles; combined with that, the equity of Horlicks is leading to a lot of trails. The initial response to Foodles is much higher than our expectations.”
On the other hand, HUL, which rolled out Knorr Soupy noodles in the South this February, had to postpone the brand’s national launch due to capacity constraints because of heavy consumer offtake. An HUL spokesman said: “We are very pleased with the performance of Knorr Soupy noodles.”
Private brands are whetting appetites of consumers too. According to Devendra Chawla, business head, private brands, Future group: “The category boundary is set to be re-drawn. From a snack food targeted at children, instant noodles category has evolved as a mainstay meal even for grown ups.”
Mr Chawla said Tasty Treat was the second biggest instant noodles brand in its Big Bazaar stores after Maggi. The brand packaging was revamped last year and Future plans to roll out additional variants in a month’s time taking the number of variants to nine from the existing three.
Yes. the statement is correct .Today mkt is driven by consumers. Now a day a consumers are highly educated.their life style and taste and prefrences are changed.In previous years demand is huge but supply is less.So the consumers were satisfied what ever the avaliable in the market.But now a days huge competation in mkt similar products are avaliable.If the companies want to sell their products they have to study the behaviour of the consumer towards the products.
ReplyDeleteFor ex:
1.In1980-1990 their is one company who manufactured cars MARUTI. At that time they were made a model maruti 800.That model run for 10 yrs .bcz demand is huge but the supply is less .and no competation in the mkt. But now a days after a 4-5 months the company will lounched a new model because the consumer wants variety.
2.Shampoo mkt .In previous yrs whatever the flavour of shampoo is made that were sell. But now a days one particular brand make a different flavours according to the need of the consumer .Like SUNSILK comes in different flavours YELLOW FOR DANDRUFF . BLACK FOR SILKY HAIRS And so on.
SO WE CAN SAY THAT TODAY MARKET IS DRIVEN BY CONSUMERS.
SUMAN GREWAL.