Instant Noodles

Topics: Instant noodles, Brand management, Maggi Pages: 7 (2236 words) Published: March 22, 2013
Maggi losing instant noodles market share in India to new entrants *
NEW DELHI: Maggi instant noodles, foods major Nestle's flagship brand that has dominated the Indian instant noodles market for nearly three decades, is losing market share on a monthly basis to newer entrants such as GlaxoSmithKline's (GSK) Horlicks Foodles, Hindustan Unilever's (HUL) Knorr Soupy noodles, Big Bazaar's Tasty Treat, Top Ramen and several other smaller players, according to data by market research firm Nielsen.

The data shows that Maggi's share of instant noodles, on an all-India basis, across urban markets, has slipped consistently between December '09 to July '10. While Maggi instant noodles (minus vermicelli) had a 90.7% share in December '09, the share dropped to 86.5% in July '10 on an all-India basis. A regional split of the data shows that Maggi's instant noodles' value market share has fallen across the east, south, north and west zones for the same period. Analysts say with new competition, Maggi's market share is certain to get impacted , but add that Nestle has the potential to expand the Rs 1,300-crore instant noodles category – which itself is growing at a rapid 15% annually. A detailed email sent to Nestle on Thursday elicited no response. Apart from HUL and GSK which have positioned their noodles as 'healthy' snacking options targeting kids and mothers, others like Indo-Nissin's Top Ramen, Capital Foods' Ching's Secret and CG Foods's Wai-Wai , though around for long, are stepping up marketing efforts to take advantage of category growth. Besides, private brands like Big Bazaar's Tasty Treat and Aditya Birla Retail's Feasters are notching up share. Manoj Menon, FMCG analyst at brokerage firm Kotak Securities, wrote in a report earlier this month: "Maggi faces product substitution risk and brands like Knorr and Foodles could potentially impact its incremental growth. Nestle faces a challenging competitive environment in culinary." GSK, which entered the category in December last year, has taken away share from Maggi mainly in the South and East riding on the equity of Horlicks and its well-entrenched distribution in the regions. GSK's executive VP, marketing, Shubhajit Sen, said: "Consumers were looking for a choice in instant noodles; combined with that, the equity of Horlicks is leading to a lot of trails. The initial response to Foodles is much higher than our expectations." On the other hand, HUL, which rolled out Knorr Soupy noodles in the South this February, had to postpone the brand's national launch due to capacity constraints because of heavy consumer offtake. An HUL spokesman said: "We are very pleased with the performance of Knorr Soupy noodles." Private brands are whetting appetites of consumers too. According to Devendra Chawla, business head, private brands, Future group: "The category boundary is set to be re-drawn. From a snack food targeted at children, instant noodles category has evolved as a mainstay meal even for grown ups." Mr Chawla said Tasty Treat was the second biggest instant noodles brand in its Big Bazaar stores after Maggi. The brand packaging was revamped last year and Future plans to roll out additional variants in a month's time taking the number of variants to nine from the existing three.

There are some who leads called leader and there are some who follows, called follower. Maggi has been a leader for decades and it is Maggi who educated Indian consumer about noodles. Of course, their market share might got depleted in course of time, by the entry of some very big players but Maggi will not sit silent. They will also reinforce their activities which will ultimately benefit the consumer. People will definitely taste for a change, but I view it is very difficult to change ones taste bud and the top of mind game, as Maggi has become a generic name in India for their long presence.

Maggi is one of the largest and oldest instant food brand in india. Maggi will remain no one brand...
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