Pepsi takes on ‘localikes’: It’s crunchy, it’s munchy, but it’s not Kurkure

08 Jul,2013

By Rajiv Singh


Chutkure, Hurhure, Chulhule, Karkare, Taktake – all may be crunchy, but not Kurkure.


Feeling the heat from a sea of lookalike local and regional brands that have been munching on the popularity of Kurkure over the last few years, beverages and snacks major PepsiCo has finally decided to fight back.


Tedha’s Straight Journey


Launched in 1999, Kurkure is not only the first made-for-India salty snack brand from PepsiCo but also among the eight Rs 1,000-crore plus brands in PepsiCo India’s portfolio.


Over the last few years, the brand has been adding regional flavours. In 2010, Kurkure rolled out an ingredient innovation with the launch of Kurkure made with Rajma. Next year, ‘Ingredients of India’ range rolled out regional flavours like Mumbai Chatpata Usal, Bengali Jhaal and South Spice Mix. Earlier this year, it introduced three new flavour combinations, based on popular international cuisines but with a desi twist-Punjabi Pizza, Andhra Bangkok Curry and Rajasthani Manchurian.


Last December, the brand went for a makeover. It dropped its long-time mascot Juhi Chawla and roped in five new brand ambassadors-Parineeti Chopra, Kunal Kapoor, Boman Irani, Farida Jalal and Ramya Krishnan-to widen its appeal.


The latest TV commercial of PepsiCo’s flagship salty snack brand Kurkure asks viewers: Kuch bhi crunchy milega toh khaoge kya? (Will you eat anything that is crunchy?). The advertisement, pushing Rs 5 pack of Kurkure, ends by saying ‘5 Rupaye mein koi khaane waali cheez khao.’


However, PepsiCo says desi brands are an irritant, but definitely not a headache. “There are over 140 lookalikes of Kurkure,” says Nalin Sood, category director, India Snacks, PepsiCo India Foods, “and over 2,500 local players in this segment.” But we are not feeling the heat from them, he avers.


The Rs 5 price point is an impulse category where consumers are not emotionally attached to the brand, points out Sood. “Our latest advertisement not only hits at local brands but also tries to inculcate brand loyalty among consumers for this low price point,” he says, explaining the trigger for the latest commercial.


But marketing and branding experts disagree. The fact that PepsiCo for the first time is urging consumers to make an informed choice while buying snacks says it all.


“Unarguably, Kurkure is feeling the heat from local brands that are near lookalikes,” says Smitha Sarma Ranganathan, a brand communication specialist who teaches marketing management at IBS Bangalore.


Instead of targeting some unknown brand in the commercial, the company should have continued with its focus on creating a family-driven context for connecting with Kurkure wherein the brand becomes the snacky content of choice, she adds. “Consumers look for value-for-money and not loyalty at Rs 5 price point.”


The Head is On

PepsiCo’s Kurkure and Lay’s, which dominate the Rs 9,500-crore Indian snacks market, have been steadily losing market share to a slew of regional players such as Gujarat-based Balaji, Indore’s Yellow Diamond and DFM Foods’ Crax that have cracked the local market as well as matched global players on pricing, quality and regionalization.


While the market share of both the brands slipped 2-3% in the April-September period last year, Balaji, Parle, Yellow Diamond and ITC’s Bingo gained, according to Nielsen data. However, PepsiCo’s Sood says the market share of Kurkure is intact.


Recently, PepsiCo has been facing headwinds not only in the snacks sector but also in the beverages segment, as it reaped less-than-expected returns from Rs 160 crore spent on the sixth edition of IPL.


While its market share in April this year fell to 29.7% from 32.1% over the same month last year, rival Coca-Cola increased its share to 48.3% from 45.8%. Moreover, PepsiCo’s region president for India and South Asia Manu Anand quit late last month.


Desi Tadka Rules!

Desi brands, say FMCG analysts, not only have their finger on the pulse of regional flavor and taste, they also pip global biggies in giving more margin to the local retailers.


“Local brands know PepsiCo can’t match them in terms of offering high margin to distributors,” says an analyst, requesting anonymity. So the retailers keep pushing desi brands, he says, adding that Rs 5 price point has become highly competitive. “And PepsiCo is feeling the heat because Rs 5 is the single-largest selling pack for Kurkure.” So, they are left with no choice but to react, he says.


But if PepsiCo indeed is hitting at the local brands, the message that its TVC conveys is tedha (twisted), point out experts.


They need to make it clear who they are fighting against, says KV Sridhar, chief creative officer of Leo Burnett, Indian subcontinent. “If they are targeting look-alikes, then the advertisement doesn’t talk about it.”


The TVC shows a chic pack of a 5-rupee snack in the hands of Kunal Kapoor, which supposedly attempts a direct hit at local 5 brands only to that it turns out to be a googly, says Ranganathan of IBS Bangalore.


A closer look at the pack visual translates into ‘oh-so-familiar looking’ feeling of deja-vu, only to get the consumer relate it to Lay’s, also belonging to the PepsiCo snacks stable, perhaps risking a cannibalisation, she adds.


Agrees Sridhar. If indeed they are hitting at local brands, then they could have used transparent packs to show that, he says. “In their eagerness to push sales, they have missed out the details.”


PepsiCo says it carried out intensive pre-tests with consumers before the launch of the TVC. “During the research conducted both prior and post the campaign, an overwhelming majority associated the pack with the unorganised/unbranded snacking options available and not to any branded large national player,” counters PepsiCo’s Sood.


Source:The Economic Times

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