The Hindu Business Line : Marico looks to grow in functional foods

Consumer products company, the Rs 1,556-crore Marico Ltd, plans to grow its business in the functional foods category. It had earlier extended one of its core brands Saffola to an atta mix, a product which it recently re-launched wi th an appropriate marketing mix.

“Our thrust is on foods and supplements and we plan to have a range of Saffola products,” declared Mr Saugata Gupta, CEO, Consumer Products, Marico Ltd.

Beauty & wellness

In an interview to Business Line here recently, Mr Gupta said that the focus for Marico as an organisation would be in the spheres of beauty and wellness.

“Given the trend of lifestyle diseases, stress and so on, wellness is a key area.

“We have a strong brand in Saffola and we think that brand is quite a bit underleveraged,” elaborated Mr Gupta.

The atta mix, a cholesterol management product, was test marketed in Mumbai and now launched nationally. More will follow, avows Mr Gupta.

“I think we are lucky to have a product portfolio that rides a trend. If you see globally, it is very difficult to run a business that is against a consumer trend; it brings into question the long-term sustainability of a business.

“We are lucky that our products and plans fit into the trend of wellness. Today, wellness is half a leg for us — we have salt, oil, but there are a lot of products to be plugged in,” he said.

Staples game ruled out

However, Mr Gupta is clear that Marico will not enter the staples game. Staples, as he explains, is a low-margin high-volume business.

“And we do not want to get into that. Having moved away from branded commodities, we have moved up the value chain and wouldn’t want to undo that. We would like to give efficacious products.

“Any new category requires category building and investments. Growth will take time to come in, but we are in for the long haul,” he emphasised.

High on the agenda for Marico is to gain a higher footprint for Saffola, a safflower oil brand.

As of now, it is present only in about 10 cities with a middling presence in the South.

“However, we have been investing in the brand over the past two years and have nearly doubled our base,” he added.

Modern trade growth

The other trend that is helping Saffola is the growth in modern trade. The brand’s modern trade market shares are higher than the traditional trade share.

“This is because our products are slightly niche and catering to higher-end consumers. We do function at a premium. I don’t think people today are very price conscious, though they are value conscious,” he elaborated.

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