Mumbai: Britannia Industries Ltd is investing Rs100 crore to revamp its premium biscuits products portfolio to boost market share in the category to 50% in two years from 35% now, a top company executive said.
Britannia will spend nearly Rs100 crore in the next 9-12 months on its three premium cream brands—Pure Magic, Bourbon, and Treat—to revamp this category that has seen flat growth during the past three years, said Ali Harris Shere, vice-president of marketing at Britannia. Of this, Rs50 crore is earmarked for the brand “Treat”, Shere added.
“Cream biscuits as a category has not been growing, and there are 2-3 reasons why there is stagnation,” Shere said. “One is, it is a discretionary category. You do not necessarily consume cream biscuits every day with a beverage, with a tea. You think of tea, you think of a cookie. We, as marketers, have not been able to create those hooks of consumption,” he said. “Pricing is another barrier, premium cream biscuits’ pricing is almost 2x the average of biscuits,” Shere said. “Which means premium cream biscuits are expensive, which inhibits regular consumption.”
Cream biscuits category contributes 7.5% of Britannia’s total revenue. The category accounts for 7-8% of the total biscuit market in India, Shere said. However, nearly 30-40% of total advertising spends on biscuit brands in India are invested in promoting this category, he added. Other major cream biscuit brands include ITC’s Sunfeast and Mondelez’s Oreo.
As part of the revamping, Britannia has relaunched “Treat”, its cream biscuit brand for children, with new packaging and a new biscuit design. The company has also introduced two new flavours—Funky Chocolate and Kool Vanilla—and is launching a new television ad campaign for the brand in a week’s time.
Britannia is looking to double the number of outlets that Treat reaches, from 200,000 stores in India. While this will largely be in urban areas, Britannia expects to sell the brand in rural parts of Kerala and Tamil Nadu as well, Shere said.
“We have increased our direct reach in the last three years from 7.5 lakh outlets to a 15.5 lakh outlets,” he said.
Britannia plans to take steps to boost sales of its two other cream biscuit brands every 3-4 months from now on, Shere said.
This is part of Britannia’s long-term strategy to launch new products across its biscuits portfolio. In May, the company introduced Good Day Wonderfulls, a new premium cookie variant to reach out to the Rs4,000 crore premium cookies market.
Britannia is also working to increase sales after de-stocking by dealers in the run-up to goods and services tax implementation hurt the company’s earnings.
Britannia’s net profit for the quarter ended 30 June fell 1.4% from a year earlier to Rs216 crore.