Indian consumers want the best of both worlds. So focusing only on health may backfire.
Consider this: Pepsi came up with a new variant called Pepsi Max, which was positioned around a stronger taste and zero sugar. Though the positioning revolved around the smartness and fun aspect, it also talked about its health benefit as it contains zero sugar.
Was it the correct positioning considering that the other brands in the same portfolio also talk about similar aspects in terms of ‘fun’ , ‘coolness’ and ‘Gen-Y’ appeal? In my view, when you are asking consumers to pay such a premium for a product which belongs to a matured category, then your communication needs to concentrate on the health benefits that are specifically offered by you, more than the areas which are already being exploited by other brands.
By doing the latter, your communication is not creating a clear picture. So, in less than one year of its launch, Pepsi has stopped production and is withdrawing the product from the market. All sugar-free cola drinks still account for less than 3 per cent of the total market. The message from the consumers seems to indicate that people are not willing to pay extra money for the health benefits offered by a cola drink.
Similarly, Parle tried to come up with Monaco smart chips, roping in Aamir Khan as brand ambassador. Smart chips were in direct competition with Aliva – a healthy offering by Pepsi Co. The differentiating factor between the positioning of the two products was the complete focus on health by Parle, whereas Aliva was projected not just as a healthy option (baked) of evening snack; but also as a tangy, fun-filled snack that is specially designed for the Indian palette.
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The success of Aliva and the failure of Monaco smart chips highlight the fact that being healthy is a quality which will help to increase sales, but it can’t be the only point of attraction in a product.
The next in the list are sugar-free sweets and chocolates. Yes, they can still be found in some large groceries or organized retails but you don’t get to see them in every shop across the road because of the lack of demand for these products. The two points that work against them are: no association of incremental health benefits for extra money spent; and infrequent consumption of these products.
As these products are consumed on special occasions, people don’t attach any risk because of the low frequency of consumption. It’s a fact that the modern consumer is more aware about the health problems; but it’s also true that an Indian consumer is not willing to sacrifice on taste for health benefits.
To find a way around this problem, he might reduce the consumption of cheese-loaded pizzas but he won’t go for the healthier snack options available to him because of the taste at the respective price. Indians follow the policy of ‘chalta ha (it’s ok for once-in-a-while consumption)’ when it comes to food which is not consumed regularly.
This does not mean that the future for health products is not bright in India. We have seen sugar free products increasing their reach and different food chains offering low-fat food. The success of Subway along with its expansion plans in the near future is an indicator of the change that we will see in the coming years. Subway is catering to a niche segment of people who have the purchasing power of buying at a premium for the sake of better health. The special deals on subs, the wide range and comparable taste with the ‘Good for health’ positioning is creating a new section in the fast food segment.
One thing is pretty clear. The focus of all companies should be on products that are healthy at a reasonable cost, but at the same time offer a taste that is appreciated by Indian consumers.
(The author is a student at IIM Calcutta, batch of 2010-12. This is an edited version of his article)