While the recent inflation in vegetable prices may have caused many a consumer to break into a sweat, one brand that took advantage of the situation was Godrej Real Good Chicken (RGC).
This low-cost proposition, launched late last year, seems to have worked for the brand. Not only has it helped the brand gain acceptance among lower SECs, RGC's customer base has also increased by 50 per cent. Additionally, the company feels it has given consumers, especially those from lower SECs, an affordable way of meeting their daily protein requirements. Chicken is the cheapest form of protein (on a per kilo basis) that a person can buy - 100 grams of chicken provide 25 grams of protein.
Sushil Sawant, associate vice president, marketing, R&D/new business development, Godrej Tyson Foods (which owns the RGC brand, in addition to Yummiez, a ready-to-cook brand), is delighted at the way consumers have accepted his brand. "A Rs. 48 pack is like a chicken sachet, and it sold!" he enthuses. The campaign enabled the brand to penetrate consumer pockets that it did not address earlier. The price factor was so attractive that even low income consumers, who would otherwise think twice before buying RGC in a store, bought the brand readily.
Under the new proposition, the brand offers 400 grams of chicken for Rs. 48. A one kilo bird would cost between Rs. 70 and Rs. 180, depending on where it is bought. Meanwhile, a person can buy half a kilo of yam, red pumpkin, green peas or lady's finger in the range of Rs. 34 to Rs. 44.
So, what made the brand offer chicken at such a humble cost? Sawant explains that price inflation in vegetables forced consumers to alter what they buy. This, in turn, affected their protein in-take. Moreover, market research revealed consumers saying things like, "Today, vegetables are more expensive than chicken. So, why not eat chicken every day?"
Sawant saw consumer insights in all these consumer realities. "We clubbed these insights with food inflation and came out with a solution that makes chicken affordable not only to high end consumers, but also to the masses. This gave birth to the Rs. 48 pack," he explains with pride.
Besides, people were used to buying warm meat, unlike today where consumers don't fear touching cold chicken. "That's a huge mind shift in understanding the attribute of freshness," he points out, adding that consumers have now grown to appreciate the convenience of buying RGC products; after all, given the absence of the physical mess that usually accompanies buying meat from the local butcher, consumers can't help but welcome the option of buying packaged, yet fresh meat. In fact, they can easily delegate the job to their children, something they couldn't do earlier.
Since it's a perishable item, it has not been able to go beyond markets that are in close proximity to its manufacturing units in Mumbai and Bengaluru. The brand is operational in five cities, namely, Mumbai, Pune, Bengaluru, Hyderabad and Chennai.
What it lacks in national presence, the brand makes up for with easy access to its products. RGC sells through conventional supermarkets, conventional meat shops (which forms a large chuck of its business), kirana stores, mom and pop stores and even shops that don't fall in any category, for instance, STD booths.
Expanding Consumer Base
Prior to the Rs. 48 proposition, RGC's primary target audience was SEC A and B. SEC C came into the fold of late. However, the 'affordability campaign' has opened up a new avenue for the brand - SEC D.
Sawant explains that the only difference between the four SEC groups is the frequency of chicken consumption based on earning - and consequently buying - potential. For instance, an SEC D consumer may possibly buy the meat twice a month while an SEC C consumer may buy it four or five times a month.
The brand's core focus is young couples in the 25-35 years bracket. However, it has also witnessed a rise in consumers from the 20-25 years bracket, especially in Mumbai, Pune and Bengaluru, cities that have a high density of students living alone. Sawant calls the Rs. 48 proposition a "blessing" for these customers, who are typically cash-strapped and perpetually in need of a quick-fix meal.
While the overall chicken industry in India is recording eight per cent year on year growth, the fresh branded segment (the category RGC operates in) is growing at 15 per cent. Interestingly, Sawant attributes this growth, in large part, to societal changes like rise in nuclear families, increased spending power, increase in fast food consumption/QSR outlets and an increasing number of retail stores.
Gravy to Gourmet
Increased exposure of urban Indians to international cuisines and gourmet food has also impacted the sales of RGC. The brand has seen a significant spike in demand for its 'specialised portion packs' such as chicken breast fillet, lollipops, chicken legs, etc. - items used in gourmet dishes. "Earlier people bought whole chicken cut into pieces. The concept of portions was not there," Sawant says. While the conventional pack of pre-cuts still enjoys the highest demand (since these pieces are most commonly used in traditional gravy/curry-based dishes), many people are buying portions to experiment with unconventional recipes.
Brand versus Butcher
The unorganised nature of the fresh poultry business is the brand's biggest source of competition. Interestingly, the brand has turned this adversary into an ally - RGC has partnered with local butcher shops such that they have begun stocking the product. It's literally a 'Can't beat them, join them' scenario, but a win-win situation for both parties, nevertheless.
In fact, butchers feel if they don't stock the "value added advantage" that the brand offers, they will lose customers. Sawant says that for a butcher, in order sell 400 grams of chicken at Rs. 48, he will have to cut a whole bird. "What will he do with the rest of the meat? It's a challenge for him. So the biggest opportunity for a butcher is to sell our chicken because we help add value to what he does," he says confidently. In fact, for RGC, butcher shops contribute a sale volume of roughly 10-15 per cent.