Subroto Mukherjee, chief operating officer of Baskin Robbins (Saarc), talks to Sohini Sen and Sarmistha Neogy on his expansion plans, new launches and challenges before the industry.
You have launched flavours such as Malai Kulfi, keeping the Indian market in mind. How are these doing?
Quite well. Baskin-Robbins, as a brand, is very flexible. We realised that the best way to move forward would be to connect with the consumer by coming up with these local flavours. The whole beverages and ice-cream industry is very vibrant. Everyone wants something new once in a while. When we noticed some fatigue in the pattern, we decided to revamp one-third of our products. Having said that, I think the flavours that are doing well abroad continue to do well in India too, like the Honey Nut Crunch still remains our best-selling product.
You have used radio as an advertising medium. The advertising strategy before this was always below-the-line (BTL). Why are you changing now?
We have always been a BTL brand, as it is much more personal. However, with the global anniversary, we saw an opportunity to connect with our target audience via new avenues. Yes, we are looking at above-the-line (ATL) strategy, but we still prefer an insert or a flyer.
Are you planning to expand into tier-II and tier-III cities? Will there be any compromise on the price front?
We are already present in 95 big and small cities with 418 outlets. In some places we have the lounge concept. As a policy we follow a uniform pricing strategy. The price should not be a problem because though we are not a mass brand, like Amul, we are also not a premium brand like Haagen Dazs. We can be called a ‘masstige brand’ - we cater to the mass with the prestige, dignity and quality of a premium product.
Local and regional brands, like Naturals and Nirula’s, are doing well. Do you think they are a threat?
Our competition is not just with ice-cream brands, it is with any Quick Service Restaurant (QSR) which serves desserts. We are basically an impulse driven category and prefer to be located at a high street location where people will have an easy access to our stores.
Are you focusing more on product expansion or on advertising?
Our focus is on both. We are looking at newer markets and products. Our aim is to see a 10-12 per cent same store growth for maximum resource utilisation. While the ice-cream industry has been growing 10 per cent y-o-y, we have grown as much as 30 per cent. We have an aggressive expansion plan in mind. Last year we added 86 stores. This year even though we are facing a bit of slowdown, we plan to open 65 more stores.
What are the challenges the ice-cream industry is facing at the moment?
The problems the industry is facing are huge. Firstly, of the Rs 2,000 crore market for this segment in India, only Rs 800 crore comes from organised retail. Secondly, the consumption level in India is very low. While the average American consumes 24 liters of ice-cream per year, an Indian only has 300 ml. The Indian desserts section is itself so popular and varied.
However, the biggest problem which we are facing now is the lack of cold storages and logistics. Unless that is solved we will not be able to project ice-creams as an affordable and reachable dessert option.