The Hindu Business Line : The Indian challenge

REPLACE your regular cooking oil with just one-third of olive oil and go a step ahead in leading a healthy life — Dalmia Continental is aggressively marketing its olive oil brand, Leonardo, on the health plank. The company claims to be the first to launch edible olive oil in India, with its Leonardo brand of olive pomace oil. And the challenge clearly is to convince Indian consumers to use olive oil in their daily cooking, says Narayan Rajagopalan, President and Chief Operating Officer (Olive Products Division), Dalmia Continental.

Rajagopalan says the olive oil market in India would be in the region of Rs 60 crore and is growing at the rate of 40 per cent annually. "But at the same time it is highly fragmented and misinformed. A majority of consumers purchase olive oil for massages or for enhancing the flavour of pasta and other Continental dishes they make," he says.

However, the company's focus would be to get the Indian consumers to cook Indian dishes in olive oil. "Our emphasis would be on quality, taste and nutritional value of the product. The benefits of olive oil are immense as it not only provides monounsaturated fats which are best for the body but also is a rich source of vitamins A, D, E and K, all antioxidants which fight cancer and prevent ageing. Recent studies have also shown that olive oil plays an important function in preventing coronary diseases and is effective for the digestive system, bone structure, brain and nervous system."

Rajgopalan says that the Leonardo Olive Pomace Oil is specifically meant for Indian cooking as it has a neutral taste, while the Leonardo Virgin Oil is meant for massages and flavouring.

Marketing strategy

Instead of investing in mass media, the company, says Rajagoplan, preferred to use various below-the-line media to interact with consumers on a one-to-one basis. It is doing a series of promotional exercises which includes hosting cookery shows on television and tying up with hotels and restaurants to use Leonardo as their cooking medium.

The company has also started a Bollywood theme restaurant, Filmi Masala, in Gurgaon, which offers Indian cuisine cooked in olive pomace oil. Rajagopalan says that similar restaurants would come up in the other metros in the next two years. "We are also putting together an institutional team to approach the restaurants and hotels in various cities."

Also in the pipeline is the launch of a recipe book anchored by cookery expert Nita Mehta. "We are also in talks with various publications to conduct a recipe contest using olive oil as the cooking medium," says Rajagopalan.

Challenge

The biggest hindrance to most olive oil brands in India is that of price. A one-litre bottle costs around Rs 300, compared to a sunflower oil which is in the region of Rs 60-70 per litre. The price disadvantage has in fact forced many a brand such as Saffola to withdraw their olive oil variants.

Says Milind Sarvate, Chief Financial Officer, Marico Industries (which manufactures Saffola), "Olive oil continues to be a specialty oil and therefore will have only a select clientele. On a low base, it may be growing by a statistically large percentage but in absolute value terms, it may not mean much."

Similarly, K. Radhakrishnan, Vice-President (Marketing & Merchandising), FoodWorld, also says that the olive oil brands have to bring down their prices to have a considerable presence in Indian homes. "Cooking oil is an extremely price-competitive medium in India, since we are the largest users of cooking oil in the world. If olive oil is sold at Rs 300 per litre, it will be difficult for it to be accepted by the consumers."

Rajagoplan says that he is aware of the price disadvantage the category has. "Olive oil is no doubt three times more expensive than the regular refined oil that is available in the market, but one needs to use only one-third of the regular oil for cooking."

At the same time, he is confident that the company would be able to bring the prices down once the brand generates volumes. "The prices would also reduce considerably once the company's bottling plant is set up in Kappoli in Maharashtra." The company now has a tie-up with an Italian company, Nichola Panteleo, from where it sources its products.

Experts' views

Rajagopalan's positioning of his brand as healthy and a medium which could be used for Indian cooking as well does not find acceptance among many experts.

Chef Ananda Solomon, Executive Chef, Taj President (Mumbai) and Corporate Chef, Taj Business Hotels, firmly believes that Indian food should be cooked with Indian oils and olive oil should be used only for Italian cuisine or other Continental preparations. "Why should we use olive oil to cook Indian food when our own cooking mediums such as sunflower oil or groundnut oil have gone through a lot of refinement and are low on cholesterol and fat?" he questions.

He says that puris for instance, will never have the desired flavour if they are fried in olive oil. "If one sticks to a systematic living pattern, the cooking medium will never be much of an issue."

Similarly, Chef Giridharan, Executive Chef, Savera Hotels (Chennai), also feels that olive oil will never be able to add to the flavour of Indian dishes. "However, we strictly use extra virgin oil in our health food restaurant, Citrus," he says.

Radhakrishnan of FoodWorld says the olive oil brands need to do a considerable amount of brand building and also try to create awareness about the category. "There is a huge preference for healthy oils. The olive oil brands need to position themselves on the health plank and talk about keeping various lifestyle diseases such as cholesterol at bay by using olive oil." He says that the category hardly has any brand consciousness.

Rajagopalan, however, is confident that Loenardo's health positioning will go a long way in convincing consumers to use olive oil as a cooking medium. "The last one year has already seen prices of olive oil dip. While the price of one litre of extra virgin oil has dipped from Rs 750 to Rs 530, olive pomace oil, which was Rs 500 last year, is now Rs 270. Apart from this many large institutions and restaurants have already switched to Leonardo Olive Oil, which includes the Oberoi Group, the Grand Intercontinental Group and the Park chain."

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