Pepsico India to reorganize Snack Brands: back to Lays and Kurkure

PepsiCo India Holdings Pvt. Ltd, is streamlining its snacks portfolio, creating two master brands: Lay's and Kurkure for western and Indian traditional salted snacks respectively.

The strategy will see Kurkure, which is synonymous with tedha medha (crooked shaped) extruded corn-based chips, enter new categories of Indian savouries such as peanuts and fried moong dal. It has already launched some 10 such ‘namkeen’ products under the brand in the past couple of months.

Partho Chakrabarti, vice-president, snacks category, PepsiCo India:
 

“Kurkure is one of the most loved and trusted brands for the last five years. However, there are very few occasions when you can have it as it’s a single product. That limits our role in India."

"That is why 2016 will be largely about stretching Kurkure across namkeen and making it the quintessential Indian snack.”

The company is planning new launches every 3-4 months to add to the portfolio of its two master brands. Also in the pipeline are murmura mix (puffed rice) and chiwda mix(pressed rice), said Chakrabarti.

The move will see the company take on domestic major Haldiram Foods International Pvt. Ltd, whose Haldiram’s is the largest brand by value in the sweet as well as savoury snacks market with an 18% share.

PepsiCo’s Lays had a 15.2% market share by value, and Kurkure a 14.3% market share in calendar year 2015, according to data provided by business intelligence company Euromonitor International.

Branded Indian salty snacks account for 63% of the overall snacks market, while branded western salted snacks such as potato chips account for the remaining 37%, according to market research firm IMRB international.

PepsiCo’s change in strategy comes at a time when western salted brands such as Lays have been stagnant in the Indian market. The traditional salty snacks market with products like bhujia and chiwda grew at 4% in 2015 while the western salty snacks market contracted by 1% in the same period, according to IMRB International.

Moreover, national companies are losing out to regional ones.

As part of the reorganisation, PepsiCo will phase out Lehar, its savoury snack brand launched in 1996. Lehar has failed to make inroads into the traditional namkeen market and held just a 1.2% value market share in calendar year 2015, according to Euromonitor International.

Chakrabarti:
 

“Once Kurkure enters the segment, it makes little sense to develop Lehar. The brand will be phased out slowly.”