After entering the dairy segment with curd and paneer, iD Fresh Food is strengthening its presence in the category with the introduction of ghee. This year the company raked in Rs 100 crores from its dairy portfolio and with the launch of ghee this month, it expects to take it to more than Rs 200 crores in three to four years.
Rahul Gandhi, chief marketing officer, iD, says dairy is an attractive segment and iD is a serious dairy player in the geographies it operates.
“We have had success with paneer and curd. iD paneer on any ecommerce platform will have a market share in the mid to high 20s. Ghee is a natural extension in the dairy portfolio because it’s one of the large categories. In terms of category size, ghee is larger than curd and paneer put together,” he says.
According to industry estimates, the ghee market is estimated to be worth Rs 10,000 crore. It is a crowded market, dominated by traditional players like Amul, Mother Dairy and Paras Milk Foods. Gandhi says there is still space in the market for growth.
“The category is still being created and is still heavily under penetrated. The category creation is probably going to take the next 15-20 years and at that time we’ll think that iD was one of the early players,” he says.
Naresh Gupta, cofounder, Bang in the Middle, feels it is a big stretch for the brand. He says people have long established choices in this competitive segment. “To move from non dairy to dairy, from cooking aid to cooking fat, it doesn’t make sense. For consumers moving to a new brand is tough. I suspect ID foods is looking at the opportunity from a market size perspective. It’s similar to brands entering the honey market – even the biggest brands have struggled. I am not hopeful that iD will have a quick win,” he says.
However Gandhi believes that people are constantly experimenting with food. “They are always looking for something that offers them better value. Everything which offers them value seems to be successful. I don’t see why ghee should be any different,” he says.
Samit Sinha, founder and managing partner, Alchemist Brand Consulting, feels the brand shouldn’t have to restrict itself to dosa and idli batter for the rest of its life. “It can expand and diversify into other categories, provided the brand’s owners have a clear idea of the brand’s boundaries. If they see their brand as natural, organic, homemade, instant foods, then venturing into large and growing categories is not an imprudent move,” he says.
While Sinha admits that it will find it hard to crack the new categories, he believes their reputation as a dosa and idli batter brand is more likely to be an advantage than a liability. “They have a good chance of finding early favour amongst their current loyal customers, which could prove to be a strong platform to leapfrog from,” he adds.
Product Differentiator
When iD enters these markets it looks for a consumer need that is yet unserved. In these categories its strategy is to bring the manufacturing process as close as possible to kitchen practices.
source : Afaqs 23rd aug 2022 by Benito Chacko