Noodles segment in SOUP!

I couldn't help but get back to write a little bit more about the Noodles segment in India! While the noodle kings and new entrants are sweating it out to push a pack of noodles the Indian consumer is playing a spoilsport! They are equipped with the knowledge of nutrition, the easy preparation, the different tastes,  what more.. noodles with soup- all is out in the market and he/she is too bored if you have nothing new to offer. Adding to the misery of the established brands are the Private Labels that are luring customers with attractive prices and schemes. They have a clear advantage in the following ways:

• They can stock anywhere they want- home shelf advantage?? [:P]
• They have observed and understood the consumer behaviour - The customer strolls around and makes choices, walk in and out of their premises a million times- Pan India! [What better Market research?]
• Higher Margins- More flexibility in terms of cost
• Existing reach- and robust supply chain!

While all this action is happening. I am was a maggie loyal who switched to some other brand. The new brands played on my mind and stole me from maggie! Now lets see.. what all maggie tried and how I can firmly say- it will be pushed aside with a bowl of two minute noodles toppled over it's head if it doesn't pull its socks up!

The flavour fiasco- Rememeber when maggie changed its flavour? The angry loyals ditched the brand and it had to run a campaign (look at next point) to win them back! Why change the base flavour..? Isn't there something known as line extension or adding new variants..? Well, they did that too.. just a little late in the fleeting market!

Meri Wali  Maggie- Good move for short term. Now the nostalgia won't do the trick anymore as the loyals are reaching their mid twenties to sixties (it has been here for decades!) while the fresh blood in the target segment -the kids.. have got tongue teasing flavours and more to choose from other brands entering the segment. Meri Wali Maggie - is grandma's tale now!

Maggie sitting over Soupy noodles- While the consumers and loyals were crying out loud as to they like to lick the maggie noodles masala.. maggie which also has a soup segment infact it is the 2nd leading brand of soup in India sat on the idea till Knorr( Market leader in soups) came up with soupy noodles and  swept away the market!Remember how maggie had to save its den by adding vegetable atta noodles for the growing health conscious consumers..? What did they do with the soup segment?   Knorr also have the advantage of being associated with healthy food- soups. They had to be an INSTANT [:P] hit!  They are selling noodles.. in disguise! Open your eyes! They have carved out a comfort zone in the cluttered market and have positioned themselves in the minds of the consumer as a healthy trusted alternative!

Guess the flavour? - Have you seen this...? No..? Rush to a MORE or BigBazzar and stand near the noodle stand. You will see packages with question marks[?].. It says- guess the flavour. I was amused by the idea I must say... but a little thinking could have worked in favour of the company. Imagine a maggie loyal or maggie customer. He/she is aware of  "2 min noodle" and it is engraved in his/her brain! Now, they pick guess the flavour.. head home open the pack when hungry to make the 2 min noodle completely unaware of what it would taste like or hoping it would taste like the flavour of their choice. A slight deviation leaves them hungry, angry and with a bowl full of noodles they can't throw nor eat..?  There could be better ways...! 

So why have I grumbled so much..? I am just frustrated by clutter! :P

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A cup of noodles

Note: The statistical data mentioned in this post was taken from various newspaper articles.

Instant noodles segment in India seemed to have reached a phase of saturation with only one dominant player and a struggling runner up. Suddenly something happened and the instant noodles segment found its rebirth with many biggies flooding the retail outlets with new brand of Instant noodles. The Indian customer seemed to have grown demanding and was desperately seeking for alternative options. A ideal Indian family is now exposed to various kinds of information. An average Indian family spends 1.02% of their annual income on eating out. This makes the kids aware that there is more to noodles than a yellow yummy ‘Maggi’. This seemed like an ideal time to hit the market for companies waiting patiently for the maggi madness to reduce.  The instant noodles market in India is valued at around Rs 1,000 crore. The category is growing at 20 per cent annually. The main players are Maggi, Knorr Soupy Noodles and Foodles. Other competitors are Capital Foods (Ching’s Secret and Smith & Jones), Future Group (Tasty Treat), CG Foods (Wai Wai), Cup noodles and Nissin Foods (Top Ramen). Entering the competition is ITC with its Sunfeast Yippee noodles. The noodle leader isn’t keeping mum and is investing Rs 950 crore to set up two units to manufacture instant noodles and infant foods in Karnataka and Haryana.

While the new entrants are just filling in the market gaps with different flavours and exciting new alternatives, maggi is saddled with the old flavour as it is caught in the dilemma of catering to existing huge loyal customers and redefining itself with new flavours. It had changed the flavour of the classic maggi and was faced with strong opposition from its customer base. It reverted back to the old flavour but managed to slip in the “Healthy calcium” tag and added a variant “Atta noodles” to avoid blows from the health watch groups in the country.  It later introduced “Rice noodles” and now has introduced cup noodles. All this to remain in the market and guard its market share.  It also did a ‘meri maggi’ campaign to reinforce the brand loyalty.

But, did it wait too long to introduce new variants? Somehow the idea of cup noodles and ‘maggi’ don’t gel well. Its classic taste is so strongly positioned in the minds of the consumers that it new flavours might find it difficult to get accepted. My supposition is that the customers will retain the classic maggi purchases but reduce the quantity in their monthly basket to replace it with the new entrants catering to the same segment. This means maggi is likely to lose its ground. But, maggi will be a tough fight with its 70% market share.

PS: Instant noodles were first invented in Taiwan in the 1958. For reading about the history of Instant noodles click here

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