Movenpick: scope for a scoop in ice creams

agencyfaqs! News Bureau

NEW DELHI, October 27,

Swiss food major Movenpick may be high on confidence, but penetrating the Indian ice cream market, where bigger names such as Baskin Robbins have floundered, may not exactly be a piece of cake.

The company, which formally launched its products in India earlier this week, hopes to capture 5 per cent of the domestic ice cream market within the first year of operations. Right now, the brand has been launched only in the North, with Delhi as headquarters. Next in line would be the West, with Mumbai as the centre of operations.

For Movenpick Foods, part of the Zurich-based Movenpick Group, the development of promising products and the penetration of attractive markets with heavy financial investment has been part of the marketing strategy for long.

In fact, this strategy enabled the company to post positive results for the half-year that ended in June 2000. Global revenues from Movenpick Premium Food Products, especially ice cream and coffee, rose by 29.3 per cent over 1999 to Swiss francs 47.2 million. Much of this growth was seen in the Asia-Pacific, where the markets of Japan, Singapore, Australia and New Zealand excelled.

This is one major reason why the company is moving into India. The average gross domestic product (GDP) of India's 67-million population is higher than that in Singapore or Hong Kong. This was a major factor for deciding upon India, say company officials. They estimate the Indian ice cream market to have a potential of approximately Rs 180 crore.

In the premium segment - which the company is eyeing avidly - it plans to capture about 40 per cent of the market. The company's ice creams, initially launched in 13 flavours, would be priced in the range of Rs 200 to Rs 400 a litre.

As part of marketing strategy, the company plans to open its own ‘Ice Cream Boutiques' in some of the major cities - Delhi is to have at least six of these by January 1, 2001. Apart from these premium ice cream parlours, the company will retail its products through select top-end outlets, besides catering to institutions and hotels. In fact, the business will be a 50:50 split between retail and institutions. As part of its marketing strategy the company will bank on free-tasting sessions and sampling exercises too.

Though Movenpick has other products such as salmon, yoghurt, jam and seafood in its portfolio, for now, it has focused on two key product lines for India - premium ice cream and top-quality coffee.

The distributor for Delhi, M P Foods, would be responsible for servicing the northern market. Movenpick has invested Rs 23 lakh in building the northern region infrastructure. Another crore will be invested next year. Maintaining quality control would be a significant part of its operation strategy in India, the company insists. Initially, all the products would be imported from Switzerland. However, the company may consider manufacturing a part of its range in India at a later stage.

© 2000 agencyfaqs!