Parle Agro is taking its round and happy mascot, Hippo, to launch its second salted snack variant — Hippo Round Round. It had launched its first snack variant, Munchies, last year and followed it up with a campaign which asked audience to “Kill Hunger, Kill Evil”, insinuating that the latter was a result of an empty stomach. With Hippo Round Round, the '1,500-crore company will talk to a younger audience and widen its reach.
Snacks, along with confectionaries, comprise Parle Agro’s foods division which contributes 20 per cent to its revenues (the rest comes from beverages such as Frooti and Saint). However, in order to become a complete food and beverage company, it is pulling all stops to ensure foods bring up to 50 per cent of the sale. With its confectionery brands, Buttercup Softease and Softease Mithai retailing for '1 a piece, the bulk of the foods revenue is being brought in by its snack, Hippo. The company has tied up with Keventers in Kolkata to set up a new plant for its range of Hippo snacks, which will be up and running in a couple of months. There are four factories already under production. For now, Hippo Round Round will be rolled out in the west, followed by the south and the north. East will get its Round Round packets once the new factory starts operations.
As with Munchies, Parle Agro has strived to bring in a bevy of flavours in Hippo Round Round. While food companies have had to withdraw products or delay launches owing to flavours being rejected by the consumers, Parle Agro Managing Director Joint Nadia Chauhan is confident that it has got the flavours pat down. “We have never had to retract any flavour we have launched so far. Munchies are still going strong with the first five flavours. For Round Round, we have looked at flavours from different regions in India such as Goan Butter Garlic or Shillong Noodle Masala. These appeal to the Indian palate irrespective of the region they have originated in,” says Chauhan.
Parle Agro would continue to focus on going deeper into the market as it had with Hippo Munchies. It already reaches myriad distribution channels such as local railway platforms with its beverages and confectionaries. Hippo Round Round will ride the same channels. As many as 500,000 outlets would be serviced with five flavours in packs of '5, '10 and '20. Chauhan believes that different pack sizes ensure more trials at different times of the day.
Analysts point out that while snacking has always been a part of Indian eating habits, it is only now that people are looking at it as being more than an evening or travelling habit. The lifestyles of urban professionals and the youth have driven up the demand for ready-to-eat snacks at all times of the day. As a result, branded snacks, now valued at '6,500 crore, are seeing sales growth of around 30 per cent per year, though they are half the size of the overall market. Healthy snacks, too, are having a field day as more organised players eye the snack pie.
PepsiCo, for example, is banking on its baked biscuits, Aliva, to drive sales for its healthy foods category, while indigenous players such as ITC are assessing as many 20 products in the health snacks category. However, while Parle Agro is focussed on baked snacks, most other players are not vacating the fried snacks segment because consumers are not sure of how healthy they want their snacks to be. Parle Products has its Parle fried wafers and ITC its Bingo wafers, while Pepsi has its FritoLays wafers and Kurkure finger snacks in the fried snacks segment.
Will Hippo alone be able to turn Parle Agro into a food major in India? For now, it is betting on brand extensions to get there.
