Tang moves into Kraft's billion-dollar club

The food & beverage major is banking on markets such as India to fuel its next stage of growth.

Powdered beverage brand Tang has joined the ranks of Oreo cookies, Cadbury chocolates and Trident gum to emerge as the 12th billion dollar brand of the US-based Kraft Foods. This, says Narayan Sundararaman, director, powdered beverages, gum and candy, Cadbury Kraft Foods, has been achieved on the back of 20-per cent sales growth in emerging markets such as India and China in the last few years.

A $500-million brand till 2006, Tang, says Sundararaman, was able to double its turnover in the last four years due to its performance in emerging markets.

Kraft is now looking to push sales in markets such as India following its integration with Cadbury. The brand was relaunched recently after its distribution was takenover by Cadbury earlier this year. Before that, Tang was distributed locally by two players — Universal Corporation and Barakat Foods. Tang was also manufactured locally at a plant in Hyderabad, whose operations have now been taken over by Cadbury.

The chocolate major, which was acquired globally by Kraft in a $19.7-billion deal in 2010, has in the last few months pushed the penetration of Tang, available in three flavours, into a number of cities. "Tang is now available in almost 400,000 outlets across the country from a scenario where it was restricted to a few cities," Sundararaman says.

The gameplan, according to him, is to continue pushing penetration of Tang in India. "At the moment, we have no plans to launch new flavours," he says.

The powdered beverage market in India is Rs 400 crore constituting 40 per cent of the overall prepared beverages market, which includes syrups and squashes.

Competitors in powdered beverages include Rasna and newer entrants Fanta Fun Times from Coca-Cola. The orange-flavoured drink was launched in April.

Rasna has also been aggressive with new launches in recent years, in an attempt to maintain its market leading position. It has over 80 per cent of the powdered beverage market, according to Piruz Khambatta, chairman & managing director, Rasna Pvt Ltd. The firm is also stepping into segments such as squashes in an attempt to diversify its portfolio.