Marico to step up packaged food play as in-home consumption rises

Meenakshi Verma Ambwani New Delhi | Updated on November 20, 2020

FMCG firm Marico Ltd is looking to strengthen its play in the foods segment by betting big on the high-growth categories. The company’s sharper focus on the foods segment also comes at a time when consumers are increasingly seeking more nutritious and immunity-boosting food products.

This year, companies like Marico have witnessed a surge in household penetration in categories such as packaged food as the pandemic altered consumption patterns, helping brands bring new consumers to their fold.

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Sanjay Mishra, COO-India Sales and CEO-New Business, Marico Ltd, pointed out that the company’s refined edible oil portfolio, for instance, reported strong growth in the second quarter not just because of the rising in-home consumption but also due to enhanced household penetration. The segment grew 20 per cent in volume terms in the July-September period with 62 per cent of the growth coming from increased household penetration.

Immunity-boosting products

“Our enhanced focus on the food segment is in response to solving consumers’ needs for healthy food and immunity boosting propositions. We are seeing tailwinds behind categories such as ready-to-cook oats, honey and edible oils. We also believe that consumers’ habits of opting for healthy products with a focus on improving immunity and seeking convenience will only get more accentuated in the coming times,” said Mishra.

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He further said the food portfolio posted an exponential value growth of 55 per cent in the second quarter and the company expects its contribution to the overall revenues to increase to ₹300-350 crore by the end of the current fiscal. The company has also said it aims to grow the food business to ₹450-500 crore by FY22.

“The food portfolio will become a significant part of our overall mix. We will not only focus on new launches but also on scaling up the categories in which we already have a presence. We will also focus on garnering a significant market share in the categories that we have recently entered,” Mishra said

In line with this, in the past two-three months, Marico has launched a slew of new products. This includes Saffola honey and kadha mix and Golden Turmeric milk mix under the brand Saffola Immuniveda. More recently it forayed in the value-added Chyawanprash category with Saffola Arogyam Chyawan Amrut Awaleha.

What the future holds

Companies are debating over which of the pandemic-led consumer behaviour patterns will be short-term and which will stick with them for the long-term.

Mishra said the company has been focussing on a differentiated approach by offering products in modern and convenient formats such as the kadha mix, in the anticipation that such categories will become bigger in the near future. “We are excited about the future of the food segment, where we will launch a significant number of new products to solve consumer needs of having healthy products,” he added.

Published on November 20, 2020

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