45635952 Market Analysis of Bingo Chips

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MARKETING MANAGEMENT PROJECT

Submitted By:

Derrick Vijayan


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Marketing Management Project: Bingo

INDEX

Chapter Topic Page

1 ABOUT ITC AND BINGO 5

2 SITUATIONAL ANALYSIS 9

3 SWOT ANALYSIS OF BINGO 14

4 MARKETING OBJECTIVES 15

5 MARKETING RESEARCH 16

6 MARKETING STRATEGY 24

7 MARKETING ACTION PROGRAM 26

8 FINANCIAL OVERVIEW 28

9 RECOMMENDATIONS 32

Indian Institute of Management, Kozhikode Page 2


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10 REFERENCES 33

APPENDIX 34

ACKNOWLEDGEMENT

We take this opportunity to express our heartfelt appreciation and gratitude to our guide and

facilitator of the course, Dr G Shridhar.

We also thank the Library staff and the Computer Center Department at IIM Kozhikode for

providing us the facilities and infrastructure to proceed with and complete this project. We

also thank the countless respondents of the consumer and retail surveys conducted by our

group for the purpose of this project.



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EXECUTIVE SUMMARY

Love me, hate me, but you can never forget me This is exactly the philosophy

with which Indian Tobacco Corporation forayed into the Indian salty savories market with its

No Confusion, Great Combination potato chips brand Bingo on March 14, 2007. Right

from an advertisement campaign that generated responses from One of the best campaigns to

be floated in recent times to Was that even an advertisement!, to taking on the only

national player having a decade-long supremacy, in the low-cost branded potato chips

market, Pepsi Co, by the horns, Bingo was up against the odds. But just as the very World

Cup campaign that it was banking on (ITC was an associate sponsor for the Cricket World

Cup 2007) to provide it an initial thrust in the Indian markets, went awry, Bingo hit a green

patch in the Indian markets. Within ten months of launching, the wafer snack brand went on

to capture 16 per cent market share branded snack market. The company leveraged its

existing distribution network and easy access to the supply chain (farmers), to attain such

rapid growth in such a short time. However, 30 months after Bingos launch, Frito-Lay

continues to be top brand in this segment. With the increasing stress on Health-Conscious

snacks, and launch of Aliva in June 2009, Frito-Lay is taking the battle in this Rs 2,000 crore

branded snack market to the next level. In this project, we with the help of a consumer survey

and a retailer survey have analysed the branded snack segment and devised a marketing plan

for Bingo, as it strives to capture 50 per cent market share and emerge as the Numero Uno

player in this segment.



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CHAPTER 1

ABOUT ITC AND BINGO



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range of notebooks was launched under brand Classmate in 2003. Classmate is

Indias largest brand of note books. In 2008, ITC repositioned the business as the

Education and Stationery Products Business and launched India's first environmentfriendly premium business paper.

1.1(e) Safety Matches

ITC markets popular safety matches brands like iKno, Mangaldeep, Aim, Aim Mega

and Aim Metro.

1.1 (f) Agarbattis

ITC's popular agarbattis brands include Spriha and Mangaldeep across a range of

fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Sambrani andNagchampa.

1.1(g) Agri Business

Agri Commodities:They alsomarketFood Ingredients, Food Grains, Edible Nuts,

Marine Products, Processed Fruits, Coffee & Spices.

e- Choupal: e-Choupal initiative began in 2000 with soya farmers in Madhya

Pradesh. Now it extends to 10 states covering over 4 million farmers. ITC's first rural

mall, christened 'Choupal Saagar' was inaugurated in August 2004 at Sehore. On the

rural retail front, 24 'Choupal Saagars' are now operatonal in the 3 states of MadhyaPradesh, Maharashtra and Uttar Pradesh.

Leaf Tobacco: ITC is the largest buyer, processor and exporter of leaf tobaccos in

India. ITC buys nearly 50 per cent of all cigarette tobacco types grown in India. ITC's

Green Leaf Processing plants at Chirala and Anaparti in Andhra Pradesh.

1.1 (h) Hotels

ITC entered into this field in 1925. They have a branding strategy by which; services

are branded as 'ITC One', Towers, 'Executive Club' and hotels as Welcom Heritage,

Fortune hotels, Luxury collection. They also have branded restaurants like Bukhara,

Dakshin & Dumpunkt. ITC-Welcomgroup now has an exclusive tie-up with Starwoodin bringing its premium brand, the 'Luxury Collection', to India.

1.1 (i) Information Technology

ITCs Infotech has established itself as a key player in offshore outsourcing,

providing outsourced IT solutions and services to leading global customers across key

focus verticals - Manufacturing, BFSI, THT and Media & Entertainment.

1.1 (j) Paperboard and Packaging



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Paperboards & Speciality Papers: ITC caters to a wide spectrum of packaging,

graphic, communication, writing, printing and specialty paper requirements through

its four world-class mills in India.

Packaging: ITC is the country's largest convertor of paperboard into packaging. It

converts over 50,000 tonnes of paper and paperboard per annum into a variety of

value-added packaging solutions for the food & beverage, personal products,

cigarette, liquor, cellular phone and IT packaging industries. It has also entered the

Flexibles and Corrugated Cartons business.

1.2 About Bingo

Bingo is one the main success stories in Indian marketing of recent times. A well

crafted brand arising on the basis of an extensive market research followed by a great

channel to distribute is a sure recipe for success. In year 2007, ITC on the backdrop of

Cricket World Cup marked its presence in snack market by Bingo campaigns and it

turned out to be such a success that even the failure of it launch vehicle( Indian team

in World Cup) failed to make any dent in the Bingo success. No Confusion, Just Great

combination The punchline of Bingo looks like serving well even the clear cut

strategy adopted by ITC to serve the market right. Available in different local tastes

on the basis of regional preferences this snack turned out to be major market scooper

even if initially some people perceived it to be less preferred cousin of market leaderFritoLays.

In a country where local snacks are loved by one and all Bingo filled the void

between tasty and elegant snack option available. The untapped demand of branded

version of local tastes was so well captured by Bingo that it became the case study in

major B schools across the world. The combination of push and pull strategy created

by solid media campaign and colourful racks on the retails stores across India is living

example of crafting a well needed product and serving it best manner. The reason that

Bingo has so much to offer to learn the concepts of marketing makes it an ideal

choice even for us to take it up as our case study.



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CHAPTER 2

SITUATIONAL ANALYSIS

2.1 Savoury Snacks Market Market Summary

The savoury snacks market consists of nuts & seeds, popcorn, potato chips, processed snacks

and other savoury snacks. The market in India is diverse and large with over 1,000 different

snack products and some 300 types of savouries

2.1(a) Market Value and Market Volume

In terms of volume, the savoury snacks market in India has grown by 2.9% in 2008 thereby

reaching a volume of 887.1 million kilograms. The compound annual growth rate of the



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market volume in the period 2004-2008 was 3%.The value of the Indian savoury market grew

by 4.5% in 2008 to reach a value of $2.2 billion, with a compounded annual market growth

rate of 4.4%during the period 2004-2008. This market generated total revenues of $2.2billion in 2008 where the Potato chips sales proved the most lucrative generating total

revenues of $205.8 million, accounting for 9.3% of the market's overall value

2.1 (b) Market Forecast

In 2013, the Indian savoury snacks market is forecasted to have a volume of 1 billion

kilograms, an increase of 13.5% since 2008 and the compound annual growth rate of the

market volume in the period 2008-2013 is predicted to be 2.6%. In terms of value, in 2013,

the market is forecasted to have a value of $2.6 billion, an increase of 19.5% since 2008. The

compound annual growth rate of the market in the period 2008-2013 is predicted to be 3.6%.Table 11: India

2.1 (c) Market Segmentation

Potato chips generate 9.3% of revenues in the Indian savoury snacks market. Nuts and seeds

account for a further 3.3%, processed foods 0.80% and pop corn 0.60%, of the market value

and the rest 85.90% is accounted for by the other savoury snacks category. Japan dominates

the Asia-Pacific snack market, holding a 59.5% share overall while India controls over

12.40% of the total Asia Pacific snack market share.

2.1 (d) Distribution

The main distribution channel in the Indian savoury snack market is carried out by the

independent retailers distributing 71% of the total value. Convenience stores are responsible

for an additional 17.1% of distribution.

2.2 Market Growth

Although there has been steady levels of growth in Indian savoury snack industry during theperiod 2004 -2008, the market is expected to see some fluctuations and some deceleration in

the levels of growth between 2008 and 2013.The Indian savoury snacks market generated

total revenues of $2.2 billion in 2008, representing a compound annual growth rate (CAGR)

of 4.4% for the period spanning2004-2008. In comparison, the Japanese and Chinese markets

grew with CAGRs of3.1% and 6.9%, respectively, over the same period, to reach respective

values of$10.6 billion and $2.9 billion in 2008. Market consumption volumes increased with

a CAGR of 3% between 2004-2008, to reach a total of 887.1 million kilograms in 2008. The

market's volume is expected to rise to 1 billion kilograms by the end of 2013, representing a

CAGR of 2.6% for the2008-2013 period.



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Potato chips sales proved the most lucrative for the savoury snacks market in 2008,

generating total revenues of $205.8 million, equivalent to 9.3% of the market's overall value.In comparison, sales of nuts and seeds generated revenues of $73.7 million in 2008, equating

to 3.3% of the market's aggregate revenues. The performance of the market is forecast to

decelerate, with an anticipated CAGR of 3.6% for the five-year period 2008-2013, which is

expected to drive the market to a value of $2.6 billion by the end of 2013. Comparatively, the

Japanese and Chinese markets will grow with CAGRs of 2.6% and 5.5%, respectively, over

the same period, to reach respective values of $12.1 billion and $3.8 billion in 2013.



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2.3 Competition:

The major players in the market are



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CHAPTER 3

SWOT ANALYSIS OF BINGO

3.1 Strengths

Large Distribution network

Abundant availability and easy access to raw material

Vast domestic market

Urbanisation

3.2 Weaknesses

Lack of adequate quality control & testing methods when compared top international

brands like Lays or Pringles

Low availability of adequate infrastructural facilities and technology as it is a new

entrant in this segment

High requirement of working capital

3.3 Opportunities

Expansion of current markets

Rising income levels and changing consumption patterns

Favourable demographic profile and changing lifestyles

Integration of development in contemporary technologies offer vast scope for rapid

improvement and progress

3.4 Threats



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Competition between national and international players

Competition from unbranded players

Affordability and cultural preferences of fresh food especially unbranded ones

High inventory carrying cost

High taxation

High packaging cost

CHAPTER 4

MARKETING OBJECTIVES

To increase the brands market share from 16% to 25% and eventually to 50%

To make Bingo the most preferred brand for 40-50% of branded snack consumers

To increase penetration in the metros and big cities

To increase penetration in the smaller towns and rural markets

To successfully tackle the threat from health-conscious variants of competingbrands



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CHAPTER 5

MARKET RESEARCH

The market research is based on two surveys conducted which are:

1. Consumer Survey

2. Retailer Survey

5.1 Consumer Survey:

This survey has been conducted over a sample of 135 people from across India. The

characteristics of the sample are as follows.

Demographics

Total number of respondents = 135



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5.1(a) Preference for a particular product

Internal

The survey revealed that the most important factor for a consumers preference for aparticular brand is the number of flavours (variants) on offer for a particular brand on

snack.

Flavour - Bingo currently offers its potato chips in the following flavours. Masala,

Salted, Tomato, Chatkila Nimbu Achar, Tandoori Paneer Tikka, Tedhe Medhe and

Live Wires. The number on variants on offer for Bingo is larger than any other

competing brand in the market. Frito-Lay with the flavours of American Flavour,



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Classic Salted, Tangy Tomato, Classic Salted, Chat Street has lesser number of

flavours.

However, in the rice-chips category, the Bingo variants of Mad Angles and Tedhe

Medhe are facing stiff competition from Kurkure (also a Frito-Lay brand with 8

flavours). The launch of the Aliva brand, with four Indian flavours of baked-wheat

chips , by Frito-Lay in June is likely to provide further variety to the consumers under

the Frito-Lay banner.

The second most influential factor for a consumer to determine the selection of aparticular brand is the taste appeal.

Most consumers surveyed in their feedback mentioned that the taste and also the

after-taste for any variant of a brand plays a very important role in a consumer opting

for the same. Bingo was said to have sometimes too sour, sometimes too sweet a

taste, by consumers who prefer Frito-Lay over Bingo.

External

Among the external factors affecting the choice of a product, the visibility and

availability of a product were found to be the most important criteria for a consumer

to opt for a particular product. The strong distribution network of ITC across the

country has been leveraged very well by the company, to ensure the availability of its

product across the country. To increase its visibility the company has also distributed



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Bingo racks to retailers. It distributed about 4 lakh such large racks to display the

brand at all points of sale. The idea was soon adopted by Frito-Lay too.

Advertisements and endorsements were found to have minimum impact on a

consumers preference. On the basis of the survey, the endorsements roped in the

from Bollywood and cricket stars like Saif Ali Khan, M S Dhoni, Kareena Kapoor

and Chitrangada Singh have very little impact in influencing a consumers preference

for a brand.

The greater significane of peer reviews and preferences, implies that word-of-mouth

is the best way to induce the consumer into buying Bingo. Thus, internal factors of

variants (flavours) and taste assume greater significance and would ensure greater

penetration than mass media publicity.

5.1(b) Most preferred brand



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Frito-Lay was surveyed to be the most preferred brand for about 32 per cent of the

sample population. It also needs to be noted that Cheetos and Kurkure, too are brands

owned by PepsiCo, pushing the companys products as the most preferred for 53 per

cent of the surveyed population.

5.1(c) When are branded snacks consumed?

With 44 per cent of the surveyed population consuming snacks during evening and

night and another 19 per cent accepting that they consume branded snacks all through

the day, a clear shift in the eating habits of the youth is observed. With 80 per cent of

the surveyed population less than 24 years in age and 99 per cent less than 35 years in

age, the sample population for the survey has been predominantly young.



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With about 75 per cent of the population spending more than Rs 50 every week on the

consumption of branded snacks, they have become a component of the daily diet of

the modern youth. Thus, with time, among similarly priced snacks, the consumers are

likely to prefer healthier brands. The nutrition and calory values of a brand with time,

may gain prominence with time, over taste and flavours in affecting a consumers

choice among brands and products. The companies too have realised the same. While

Bingo has launched rice chips under the sub-brand Mad Angles, Frito-Lay has threebrands Cheetos, Kurkure and Aliva (since June 2009) that cater cornmeal, rice and

wheat-based snacks, thus focussing on the nutritional value offered at the same price.

5.1(d) Where is Bingo ranked in consumers preferred brands list?

For 12 per cent of the surveyed population, Bingo figures as the most preferred brand,

with another 36 per cent of the population placing it as the second most preferred

brand.



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Within a little over a year of its launch, Bingo had captured 16 per cent of the branded

snack market as against the targeted 8 per cent ( AC Neilsen). The brands share in

the total snacks and savouries market stood at 8 per cent by the end of 2008

(Datamonitor). To achieve the new target of 25 per cent of the branded snack market

share, Bingo will not only have to further improve the smoothness in the taste of its

potato chips, but will also have to increase sales of its rice-variants to compete against

Kurkure.

5.1(e) Flexibility of the consumer base

With about 41 per cent of the surveyed population showing readiness to switch to its

second most preferred brand on lack of availability of the first, without making any

extra effort to procure the first brand; there is huge scope for Bingo to increase

penetration within the existing markets.

5.1(f) What differentiates Bingo from the rest?



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The distribution network of ITC that ensures that Bingo is available at every retail

shelf at all points of time is what separates the brand from the rest of the competitors.

About 29 per cent of the surveyed population has accepted, the brands readyavailability across shops at all points of time is its differentiating factor. With taste

and flavours the most important factors, the companies focus on these two factors of

influence to increase sales is justified.

5.2 Retailer Survey

a) Number of retailers surveyed = 20

b) Location Kozhikode

5.2(a) Availability

In Kozhikode, ITC has been successful in leveraging its distribution network. Every

one of the 20 retailers surveyed confirmed that the supply-chain ensures constantavailability of Bingo at their shelves. The retailers also reiterated that ITC was the

most proactive company as far as ensuring the availability of Bingo at the shop at

every point in time was concerned.



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5.2 (b) Fastest moving branded snack

However, constant availability and visibility has not yet translated into maximum

preference in the Kozhikode markets. 12 of the 20 retailers confirmed that Frito-Lay

was the fastest moving product. Of the 8 that had Bingo as the fastest moving product,

5 didnt stock Frito-Lay. Bingos move to sell 20% extra in its potato chips snack than

the rivals has also helped tilt the preference of a few undecided consumers towards

Bingo, a few retailers noticed.



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5.2(c) Number of flavours of Bingo catered

Majority of the retailers hosted between 4-6 flavours of Bingo. However, it was

unanimously accepted by most shopkeepers that the bulk of the sales for the brand

came from the Masala, Salted, Tomato and Mad Angles flavours.

5.2 (d) Customer Flexibility

100%

The retailers observed that consumers, usually never mind in shifting from one brand

to the other if the other brand is famous. Every retailer conformed that unavailability

of a brand at a shop, compulsively led to the consumer opting for his second preferred

brand. Usually customers of Frito-Lay dont mind switching to Bingo. Most

consumers in this region perceive Bingo to have an inferior taste/aftertaste compared

to Frito-Lay. However, the availability of the product has resulted in a lot of

consumers reluctant to try it, being forced to do so. These consumers very soon

become regular consumers of Bingo and stop differentiating between the most

preferred brand and Bingo, pointed out a retailer.

5.2 (e) Internal factors affecting consumer preference

The fragmented replies to this question suggested two diverse opinions. The first

stressed on the fact that the brand affiliation for a product weighed heavy over every

other possible influencing internal factor, right from taste to flavours. About 50 per

cent of the responding retailers conformed to this opinion.



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Another popular opinion which emerged suggested that if a product has got an

appealing taste, there will be a market for it even if it is unbranded. Low priced salty

snacks which are unbranded or from local brands such as Grooves, had a biggermarket than Lays, Bingo or both combined at a few of the retail outlets.

CHAPTER 6

MARKETING STRATEGY

6.1Segmentation

The segmentation for the branded snacks market can be done on the following

grounds

6.1(a) Geographic:

Region wise: North, south, west, east, central, north eastCategory: Metros, major cities and towns

Geographic segmentation can be employed by the company to develop differentvariants (flavours) for different regions based on the local tastes and preferences of

that region. The company can also further segment these regions into metros, cities

and towns. Brand advertising firm Ogilvy and Mather, claimed that Bingo had

achieved its maximum market share in cities, with it being as high as 66 per cent in a

few cities. This clearly indicates, that the brand has been a huge success in a few

geographical locations and lesser so in others.

6.1(b) Demographic:

Age: 35Income levels: middle-income and high-income groups

Bingo through its snazzy advertisements that talk of Think Hatke has from the very

onset been clear that its target segment is the 18-24 and 25-35 year olds category. The

lifestyle and eating habits of this segment make it the most lucrative one for the

branded snacks segment.

The products, which are priced at the lower end in the branded packaged snacks

market, are targeting the middle income segment, the segment which has food habits



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conducive to packaged snacks and yet would be cost-conscious and would opt for

snacks in the lower end of the cost-spectrum.

6.1(c) Psychographic:

Features: Taste, quality, quantity, price and packaging

Awareness: Brand consciousness, movement towards health-conscious brands

6.1(d) Behavioural:

Time of consumption: Morning, afternoon, evening, night, all through the day.

Weekly expenditure: >Rs 200, Rs 100-200, Rs 50-100,


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CHAPTER 7

MARKETING ACTION PROGRAM

7.1 Product

Bingo is currently available in eight variants, in addition to the rice-meal snacks.

Based on the market research, the company can incorporate the following

improvements in its product portfolio.

7.1(a) Taste, aftertaste and quality

Bingo, inspite of its high penetration in a very short period of time, was perceived as

less tasty and of a lower quality than Frito-Lay by a large section of the consumer

sample.

The following changes in the product were suggested

Reduce the sharpness in the sour/sweet taste of the product. Tone down the spices

in the product.

Research and try to achieve a good aftertaste (similar to Pringles) for Bingo

products

Work on reducing the oiliness and the amount of masala that sticks to the fingers

during the process of eating.

7.1(b) Different flavors for different regions

The company must look to target each of the regions based on the spices and tastes

prevalent in the region. It should look to introduce specific flavours for each region.



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7.1(c) Moving towards health-conscious sub-brands

With competition slowly moving towards health-friendly brands (Aliva from Frito-

Lay), it is imperative for Bingo too to move into cornmeal and baked wheat meal

snacks categories.

7.2 Pricing

Bingo currently is among the lowest priced packaged snacks brands having a national

presence. Bingo was the first brand to introduce, its snacks in Rs 5, Rs 10 and Rs 20

packets. Right now Bingo and its prime competitors, Frito-Lay, Kurkure and Cheetos

are currently priced at the same levels.

In this price range, the consumers preference for a brand has been found to be

indifferent of the exact price of the product. Only 5 per cent of the population has

suggested that its preference for Bingo over its rival brands could be on the basis of

its pricing.

However, share of the branded snacks in the total savouries market currently is about

20 per cent. While lowering of prices might cause all the competing brands also to

lower prices, it can help the branded snacks industry to increase its share in the

savories market.

7.3 Placement

Both the consumer and the retail surveys have affirmed that Bingos greatest strength

lies in its strong distribution network. The brand, through its appeal to the youth with

the help of its snazzy advertisements, has been able to secure a strong youth customer

base in the cities. High visibility and availability with the help of ITCs strong

distribution network has helped it penetrate into the smaller towns. The company

must continue to leverage its distribution network. Bingo must go local, within India

and devise variants (flavours) specific to each region. The company can also

collaborate with various food joints not associated with PepsiCo , such as McDonalds

to market Bingo as the Indian snacks on offer. It had already entered into a similar tie

up with Big Bazaar retail, last year.

7.4 Promotion

The company must continue to promote itself as a youth-centric brand. This has

helped it grow at a substantial pace in the metros and cities.



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With the growing awareness about health-conscious products and Frito-Lays

launching of Aliva and Kurkure (cornmeal and rice snacks, perceived to be healthier

than potato chips), Bingo needs to get into these segments. It needs to promote theMad Angles sub-brand as a health-sensitive product.

While the whacky advertisements of the company still find a lot of takers, there is no

need to follow Frito-Lays footsteps and acquire celebrity endorsements as consumer

surveys reveal their relative insignificance.

CHAPTER 8

FINANCIAL OVERVIEW

8.1 Snacks market and analysis

In 2008 the total snack market in India was 91.2 INR billion. Today in branded snack

market, Frito Lay commands a share of 45%, followed by Haldirams at 27% and ITC at

16%. The rest is divided between new entrants, and regional players. Out of these ITCs

Bingo is a new entrant in the market, which was launched in 2007. Market consumption

volumes increased by 3% between 2004-2008, to reach a total of 887.1 million kilograms in

2008. The market volume is expected to rise to 1 billion kilograms by the end of 2013.

The snacks market is estimated to be a worth US$ 3 billion by 2013. The organised sector of

the snack food market is growing at 15% - 20% a year while the growth rate is around $ 1.56

billion, and for un-organised sector it is 7% - 8%. Consumption level of commercial savoury

snacks is 10 times higher than that in the rural markets. Around 1000 snack items and 300

types of savouries are sold in India. The segment is largely dominated by potato chips and

potato-based products with over 85% share of the salty snack market. Potato chips sales

proved the most lucrative for the savory snacks market in 2008, generating total revenues of

$205.8 million, equivalent to 9.3% of the market's overall value.

Following is the data of 2007 and 2008 showing consumption and growth of snack market

Year Kilogram (million) % Growth



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2007 861.7 2.80%2008 887.1 2.90%

Following is market analysis for different categories of snack market and its marketshare

Fig.8.2 Details of snacks industry

8.2 Competitors

Following is the data showing different companies with their market share in snacks market

Company % Share

PepsiCo ltd 6.10

ITC limited 1.40

Haldirams 1.00

Others 91.50



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Following are the calculations for knowing the growth of ITC because of BINGO launch.

Since Bingo was launched in 2007, we will take the data of 2008. In 2008 the total snack

market in India was 91.2 INR billion. Out of this ITC limited is having a 1.4% share.

91.2 billion INR * 1.4% = 1276800000 (1.27 INR billion)

So revenue generated by Bingo in 1st year of its operations come out to be Rs 127 crores.

Since snack industry is showing a growth rate of 3% in branded sector there are good

prospects of Bingo to make a lot of profit even in near future.

In the pre launch press release by ITC it was mentioned the company is spending

Rs. 700 crore in setting up a manufacturing facility. Assuming it to be for Bingo, ITC willhave a break even for this product in very short time.

8.3 Sales projection

Following is segmentation (pie chart) of all the product categories of ITC company



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Fig 8.3- Pie chart of categories of product of ITC on basis of revenue

The above graph clearly shows that ITC has huge 21% of its total revenue from FMCG non-

cigarette category.

The following are the products of FMCG non-cigarette category.

(a) Foods

(b) Lifestyle retailing

(c) Personal care

(d) Education & Stationery

(e) Safety matches

(f) Incense sticks (Agarbattis)



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Its FMCG category is in good growth. This can be understood from the following data.

FY2008 FY2009 (in thousands)

FMCG 25,068 30,016

So it is clear that this segment is having a growth of around 20% and Bingo can be a major

contributor to this growth.



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CHAPTER 9

RECOMMENDATIONS

1) Reduce the sharpness in the sour/sweet taste of the product.

2) Research to arrive at a more widely accepted aftertaste.

3) Reducing the oiliness and the amount of masala that sticks to the fingers during theprocess of eating.

4) Launch different local flavours for different regions.

5) Move towards health-conscious products; make the consumers aware about the same.

6) Maintain the prices at current levels.

7) Continue with whacky advertisement campaigns to keep appealing to the city youth.

8) Focus on maintaining visibility and availability at retail outlets across the country.

9) Partner with non-Pepsi brands like McDonalds to market Bingo as the Indian snack.



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CHAPTER 10

REFERENCES

1. http://www.flex-news-food.com/pages/17973/India/Snack/india-overview-us$3-billion-snack-

food-sector.html

2. http://www.itcportal.com/newsroom/press06june07-b.htm

3. http://www.flex-news-food.com/console/PageViewer.aspx?page=9208&str=itc bingo4. http://www.itcportal.com/itc-annual-reports-2008/pdfs/Balance-sheet.pdf

5. Datamonitor (Published November 2008)

6. www.pepsico.com

7. http://www.itcportal.com/newsroom/press-08jan08.htm

http://www.flex-news-food.com/pages/17973/India/Snack/india-overview-us$3-billion-snack-food-sector.htmlhttp://www.flex-news-food.com/pages/17973/India/Snack/india-overview-us$3-billion-snack-food-sector.htmlhttp://www.itcportal.com/newsroom/press06june07-b.htmhttp://www.itcportal.com/itc-annual-reports-2008/pdfs/Balance-sheet.pdfhttp://www.pepsico.com/http://www.itcportal.com/newsroom/press06june07-b.htmhttp://www.itcportal.com/itc-annual-reports-2008/pdfs/Balance-sheet.pdfhttp://www.pepsico.com/http://www.flex-news-food.com/pages/17973/India/Snack/india-overview-us$3-billion-snack-food-sector.htmlhttp://www.flex-news-food.com/pages/17973/India/Snack/india-overview-us$3-billion-snack-food-sector.html


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APPENDIX

Consumer Survey

A few questions about the snackyou eat

1 Are you a regular consumer of packaged snacks of brands like FritoLays, Kurkure, Haldiram, Pringles, Bingo etc?

2Please indicate your sex.

Male

Female

3 Please select the category that includes your age.



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4 Of the following, which is your most preferred brand of

packaged salted snacks?

Frito Lays

Bingo

Haldiram Namkin

Cheetos

Kurkure

Pringles

Other, please specify

5 What is it that makes you prefer a particular brand?

Brand NameVariants offered

Price

Anything, which is easily available

Taste

6Among similar priced products like Lays, Bingo, Kurkure,Cheetos; would you mind having to switch from yourpreferred brand to another on the count of availability?



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10 What is the one thing that differentiates Bingo from the

rest, if at all anything does?

Taste

The 8-plus varieties in which it is available

Availability at every single retail outlet, anywhere in thecountry

Quality, quantity and pricing

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Survey Page 2

A few questions about the snackyou eat

11 What is your weekly expenditure on branded snacks?

>Rs 200

Rs 100-200

Rs 50-100


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13 What is the one change in the product that would make

you a Bingo loyalist? Any suggestions you got for thebrand and the company?

Retailer Survey

1Which are the various brands of salt snacks (Lays/ Bingo/ Pringle) that are catered fromyour shop?

2 Which are the top three fastest moving products in this category?

3

What are the factors, according to you that govern the consumer preference for a

particular product? Kindly rank the following

1) Taste2) Flavours3) Availability4) Pricing

4

For similarly priced products, do the customers mind switching over from their preferredproduct, to the one available in your shop?Kindly ask for the percentage of customers that would not purchase from your shop just

because a particular brand is not available.

5How many flavours of Bingo are available in your shop? Which is the most preferredflavor?

6 What is it that differentiates Bingo, if at all anything does?

7Which is the company that is most proactive in ensuring that it's brands are always thereon your shelf? He won't know company names probably, so talk about Bingo, Lays,Kurkure, Cheetos.

8 Can he give an age-wise, income-wise and number of consumers that prefer low-pricedchips (Bingo, Lays) and high-priced items (Pringles, Haldiram). If he takes care to



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answer this, it will be great.

9 Ask him if he has any suggestions for improving sales of Bingo?

Documents

45635952 Market Analysis of Bingo Chips