As Salman fuels Appy Fizz, Parle Agro eyes Rs 5,000 cr growth in 2018: Nadia Chauhan
Parle Agro is all set to give its popular brand Appy Fizz a fresh boost with Salman Khan on board as the new brand ambassador as well as rolling out a new campaign featuring the Bollywood superstar.
The new marketing campaign and brand ambassador for the sparkling apple drink is linked to the aggressive growth and expansion targets set for 2018, in line with making Parle Agro achieve a Rs 5,000 crore brand turnover by the end of 2018.
Appy Fizz is a pillar for reaching the Rs 10,000 crore company turnover target for Parle Agro by 2022. The company is building scale for the Fruit + Fizz category with the objective to grow the category to Rs 4,000 crore. Parle Agro is scaling up of the brand and its penetration with the launch of the new Rs 10 Appy Fizz PET SKU.
Also, large scale investments are being made to build awareness of the brand, such as presence on IPL, ‘Bigg Boss’ in Hindi on Colors and ‘Bigg Boss’ in Telugu on Star Maa.
Leading Parle Agro’s charge is Nadia Chauhan, Joint Managing Director & Chief Marketing Officer, Parle Agro, who has been with the company for 15 years. Chauhan had joined Parle Agro in 2003 when the company was largely a single brand-driven organisation with a turnover of Rs 300 crore. Today, it boasts of a portfolio that is innovative and growing, delivering double-digit growth every single year. Under Chauhan’s leadership, Parle Agro closed calendar year 2017 with Rs 4,000 crore in revenue.
The flagship brand Frooti has seen resurgence on the back of packaging innovation. Dominating the fruit drink category in north and west India, the company is now concentrating on the Southern states, eyeing triple digit growth in South India. Chauhan has been instrumental in market leadership across every category that the company is present in, and aims to make Parle Agro the undisputed leading food and beverage organisation in India.
A big feather in Chauhan’s cap has been the large scale organizational transformation that she has been leading. She led the first round of sales and distribution transformation in 2013, a large part of which involved integration of technology into the operations to drive aggressive growth, to help bring Parle Agro on par with some of the largest FMCG organisations.
In conversation with Adgully, Nadia Chauhan speaks at length on getting Salman Khan on board for Appy Fizz, growth targets, marketing strategy, building scale for the Fruit + Fizz category and much more. Excerpts:
How did you zero in on Salman Khan as the Appy Fizz ambassador? What kind of image and positioning do you want to create?
We have been associated with ‘Bigg Boss’ for the last couple of years. We are the principle sponsor and last year, we had a promotion revolving around Salman. Year after year, we have been looking at a very positive response to the work we are doing. Appy Fizz as a brand was launched almost 10 years ago. The launch of this brand also introduced a new category, which is the fruit + fizz category. Initially, we had targeted a premium audience in a niche market because it was a completely new concept and we really wanted to see what kind of response we would get. Over the past decade, we have been growing the brand quite rapidly. It is one of the fastest growing beverage brands under our portfolio.
We have observed both the rural and urban markets, and have noticed that the brand is consistently growing and is strong across both types of markets. Keeping that position in mind, along with our ambition behind this brand, the kind of scale and growth that we wanted to achieve as well as the opportunity that existed out there – with consumers moving away from synthetic products, while at the same time since we are a country with hot summer months, consuming something that is mildly bubbly gives you that additional satisfaction of refreshment. We have cornered the market as a health monopoly despite there being some competition. We have been the only successful brand in this segment. That is when we decided that having Salman as the brand ambassador would be quite exciting because his penetration in India is incomparable to anybody else and this would really allow us to take the brand to the next level.
Salman Khan has had a strong association with ‘Thums Up’, besides there has been a lot of controversy surrounding him. Do you think it was the right decision to bring him on board for this brand?
Despite everything that has happened, I don’t think his fan following has been compromised in any form, and unquestionably, it is a very large following. He brings on a very solid macho image, a very individual personality of his own, that compliments what we’re trying to do quite well, and the kind of scale we’d like to build this brand and category into. I think we can really leverage his massive fan following.
What is the objective of the latest campaign and various initiatives under this campaign?
It’s about connecting with a much larger audience across India, with the objective being in terms of expansion and distribution. As for initiatives, we have many across digital and all kinds of consumer-based activities that would take place.
Which creative agency is behind the latest campaign?
We have been developing a strong visual language in our overall brand communication over the last few years. We work with Sagmeister & Walsh out of New York. They work across all our brands. One of the things that we’ve really invested into a lot from a marketing standpoint is to create a very solid visual language. So, when consumers actually see any of our communication, they immediately identify with the brand and are able to recall the brand as well. So, across various media, whether its television, outdoor, POS or any other communication, we have followed this visual language and help amplify the entire campaign.
Could you shed some light on Appy Fizz’s growth as a brand and the market share it commands?
We are one of the few brands in this category today, despite many trying to create a similar product. We continue to hold dominance in this category in terms of market share and grow every year at double digit growth rate of 40-50 per cent.
Who is the core TG of the brand today?
It’s the youth.
Appy Fizz underwent a revamp once you switched brand ambassadors from Saif Ali Khan to Priyanka Chopra. With Salman Khan can we expect the same?
No. I think we are just further evolving what we already created.
As per various media reports Rs 100 crore has been allotted for Appy Fizz’s marketing. What would be the key focusing areas in the brand’s marketing strategy?
For most of our brands we have a 360-degree marketing campaign, but one of the key things we are doing in the last few years is investing substantial amounts of our budget on key media associations that have really helped amplify the overall brand image and create a much larger impact for our brand. We are also expanding on mediums like television, outdoor, print, POS, digital, radio, cinema, etc.
How much is your digital spend?
We find in our industry that digital is a great support medium, but it doesn’t really take over the role that more traditional mediums have continued to effectively deliver categories and brands like ours across the country. Digital plays more of a support role in driving certain amount of consumer interaction and other such tactical initiatives.
How are you planning to build scale for the fruit + fizz category to grow the category to Rs 4,000 crore and what is the time period set for this?
Our focus is on expanding our distribution, statistically we are about 5-6 lakh outlets across the country, whereas with Frooti we have penetrated 2 million outlets across the country. Our focus for Appy Fizz is to build distribution to achieve these goals that we have set for ourselves in the next 2-5 years.
What is Parle Agro’s current brand turnover?
Rs 4,200 crore.
What is Appy Fizz’s growth in Tier 2 & 3 markets?
Across it is about 40-50 per cent.
What would be Appy Fizz’s role in the growth of the company’s turnover target?
Appy Fizz is one of the fastest growing brands and has a very large role to play. It is already in a competitive category like bubbly fizzy drinks and is doing well.
Apart from Appy Fizz, what are your plans for Frooti as you’ve signed on Alia Bhatt and Allu Arjun?
Allu Arjun is the first South specific brand ambassador for Frooti. We have kept in mind the fact that the South has a massive cinema of its own and a huge viewer base that goes to watch cinema. They connect to their own cinema much more than they do with Bollywood. So, we are really looking to further expand down South with a closer connect using celebrities from the South.
Alia has been with us for the last 2 years now and that association continues. We have recently launched a new campaign that has been very well received. Frooti has a very wide audience that ranges from kids to families, so our communication and marking strategy is always focused on trying to appeal across this wide spectrum of consumers.
We’ve seen a bevy of Bollywood celebrities as brand ambassadors for both Appy Fizz and Frooti. You really think the brands need a popular face to propel their growth?
I think there are either ways to go about it. For several years we have done without any celeb on board, and then we thought why not try out these actors and see if they can deliver. We’ve had some great experiences and at the same time we have ensured that at no point in time either of the brands overshadows the other. We have worked on a very strong balance and very unconventional forms of advertising to allow us to continue building the core values of our own brand.
What is your growth target for 2018?
We are looking at around Rs 5,000 crore by the end of this year.