Is Snacking the New Meal?
While snacking industry is highly under-appreciated, changing demographics are replacing meals with snacks. Let's see why and how!
“ITC Bingo takes on namkeen brands and Kurkure as it introduces four new namkeen flavours under its 'Tedhe Medhe' sub-brand.” – January 2021
“PepsiCo bullish on India, increases investment at snacks plant in UP to Rs 814 crore” – October 2020
How much time do you spend while choosing which snack to buy? With a wide range of options available in the market in the snacking segment, we are spoiled for choices when it comes to quenching the non-meal hunger. When the ocean is all red with options & consumers like us have very less time to spend on a shopping aisle choosing which snack to eat, brands definitely need to do something off-the-book to catch our attention, right? Now, it could be through quirky taglines like “tedha hai, par mera hai”, or quirky correlations to geometry “har angle se mmmm”.
But is catching the attention only reason that brands spend so much time and energy into packaging and advertising these products? While we do not pay much attention to snacking industry as a whole, what is it that these brands intending to cash on with new flavors and upgrading manufacturing plants? Pepsico redesigned the packing of Kurkure in 2018, after 12 months of development and designing exercises. ITC once again followed the lead by changing packaging of Bingo, the decade old nemesis of Kurkure, in December 2020. Why do you think brands go through so much pain for minor changes in packaging?
Well, addressing the first question above: As many as 88% Indians who participated in the survey by Mondelez International and The Harris Poll in December 2020 said they are snacking more than before, with millennials preferring snacks over meals. This means that about 9 out of 10 Indians are snacking more amid Covid-19 than before it against global average of two-thirds, and a majority of them expect the habit to continue even after the pandemic ends.
So that settles it – more flavors may help attract more customers & more production is required to cater to increasing number of customers.
Addressing the next big question: When the consumers are already habitual of snacking, why waste so much time and energy on redesigning the packaging? Well, according to a report by Research & Markets, The India Snacks Market will be more than INR 1 Billion by the end of 2024! Packaged salty snacks and biscuits are an over 65,000-crore market, and two of the largest categories within India’s fast-moving consumer goods basket. Now, India has a crowded snacks market with an estimated 3500 odd players, organised and unorganised combined.
While Haldiram Foods International Pvt. Ltd, which sells products under the brand Haldirams, has a nationwide presence, majority of the other players such as Balaji Wafers Pvt. Ltd and Prataap Snacks Pvt. Ltd, makers of Yellow Diamond chips, have region-specific presence.
So, when the competition is so fierce & your product falls into an impulse purchase category, where the consumer does not spend more than 7-10 seconds in deciding a purchase, the whole communication architecture rests on packaging. The least the brands can do is “cut the clutter”, increase visibility & increase pick-ups & that is exactly what the two giants did.
If you look closely at the old & new packaging of Kurkure, a) the new design shows the name clearly to prevent customer from falling in traps of similar packaged products of different brands and b) the orange color has been made brighter to catch more eyeballs.
Similarly, The new design of Bingo! Mad Angles comes in brighter colors and extra space has been given to highlight the brand name & clutter has been removed.
These changes take months to conceptualize as they involve rigorous studies of three categories of customers of Namkeens comprising kids, teenagers, and adults. The kid’s category calls for new packaging and products that are soft, chewable, spicy, and also come with offers of freebies – Kinderjoy, for example. Teenagers, being health conscious, look for healthier and high-grade products and they also have attraction for new products – Snickers fall into this category. Adults look for the brand and price and they want their money spent well; hence the quantity aspect too forms a key consideration in their choice making – these are the people who emphasize on the point that a Lays packet has more air than chips by volume.
In the past four years, Indian namkeens market is growing at faster pace @22-25% (approx.) as compared to Western snacks growing @12-15% (approx.) overall. This explains why Kurkure forayed into Namkeens flavors like navratan mix, Punjabi chatka, chivda mix and alu bhujia, in 2016 to fight its key competitor Haldirams, albeit with limited success. ITC is now following the lead by launching Namkeen flavors of Indian taste under its sub-brand Tedhe Medhe.
As discussed earlier in the article, the Namkeen market is shifting in demographics which is fueling such changes, as the fixed 'three meals a day' model seems no longer relevant. With the rise in busy lifestyles, millennials and Gen Zs have adopted snacking attitudes and are making different snack choices based on health, convenience, brand and trust. Consumers are intentionally looking for snacks to indulge in, to satisfy a craving or to hold themselves up until their next meal.
At this point of time, while Kurkure, Mad Angles, Lays or Doritos can substitute snacking, they are not enough to substitute meals – hence, the entry into Namkeens seems like a viable entry into lifestyle of these potential consumers, who form more than 50% of the consumer base of these products. Not to mention, the namkeen segment is expected to grow with double digit CAGR in next 4 years & with fresh flavors, exciting packaging & geared up productions, every big brand seems to be ready to have its own share of the pie.
By: Anmol Gupta | Isha Garg
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