Madhuwanti Saha
Interviews

“We will not rest till it becomes a Rs 150-200 crore brand”: Indrajit Ghosh of Rebel Foods on Wendy’s

A chat with the VP and global head - marketing communication and design, Rebel Foods.

These testing times have had a different kind of impact on various categories. The food tech and cloud kitchen (or ‘ghost’ kitchen) segments are among those that have witnessed growth.

By definition, a cloud kitchen is a commercial cooking facility that caters only to online orders. As per RedSeer Management Consulting estimates, the number of cloud kitchens in India is expected to grow at a rate of 50-60 per cent. In terms of gross merchandise value (GMV), the cloud kitchen sector in the country is expected to become a $3 billion industry by 2024.

The sheer lucrative nature of this ultra-competitive space (read low capex, as compared to setting up a restaurant) lures new players every now and then.

One of the noteworthy examples is Rebel Foods, formerly known as Faasos. It serves a host of cuisines, from wraps, biryanis, pizzas, desserts to Chinese food and now, even burgers. It does so through its nine brands, including Faasos, Behrouz Biryani, Ovenstory Pizza, Sweet Truth, Mandarin Oak, Firangi Bake, Lunchbox, The Good Bowl and The Biryani Life. Of these, Behrouz Biryani and Ovenstory Pizza are over Rs 150 crore brands and have been visible on the advertising circuit.

Rebel Foods also works with online-only and offline brands like SLAY Coffee, Natural Ice Cream and Mad Over Donuts by offering its cloud kitchen services to them.

Founded by Jaydeep Barman and Kallol Banerjee in 2010, the Pune-based online restaurant company has been steadily raising funds (among its investors are Goldman Sachs and Sequoia Capital). It has been expanding its footprint through more than 350 kitchens in 52 cities in India and overseas. Already present in the UK, UAE, and Indonesia, it recently opened kitchens in Malaysia, Bangladesh and Singapore as well.

There are also reports of the company sealing a $200 million funding round at a valuation of $2 billion, the latest being worth over $26 million from US-based hedge fund Coatue Management.

Last year, Rebel Foods sealed a strategic partnership with American fast food chain Wendy’s to develop and operate approximately 250 Wendy’s cloud kitchens pan-India. This is the second outing for Wendy’s in India. The brand launched four traditional restaurants through a partnership with Sierra Nevada Restaurants in NCR in 2015. The latter will develop and operate 150 more dine-in outlets.

In an interview with afaqs!, Indrajit Ghosh, VP and global head - marketing communication and design, Rebel Foods, talks about the marketing plan for Wendy’s, sailing through despite the losses, positioning EatSure (the Faasos app was rebranded as a food court app), and more.

Ghosh joined Rebel Foods three years ago from InVideo, a video creation platform. His previous stints were at MTV India, LIQVD Asia, among others.

Edited excerpts:

Can you talk about your recent campaign for Wendy’s, and also the marketing plans?

The campaign for Wendy’s was outdoor and digital marketing. We used pop culture references through our hoardings to target certain localities in Delhi. We also did influencer marketing with Akshar Pathak.

We did collaborative marketing with our delivery partners, like Swiggy and Zomato, and also did static ads. Our programmatic market buying and media planning are also strong.

The timing of this marketing burst clashed with the second COVID wave…

COVID did impact the campaign, but not the brand. As the second wave recedes, its impact has reduced. Brand salience has been built for good. Within that timeframe, we saw decent growth – a 20 per cent increase in orders (month-on-month). It gave us the confidence to launch in Mumbai in June. So overall, it was a successful campaign.

Bengaluru is now in our plans for the next quarter. By the end of 2021, the goal is to scale Wendy’s pan-India. We will continue to do a lot of digital and social media activations. This is how we have been growing our brands, like Ovenstory Pizza...

The goal is to make Wendy’s a Rs 150-200 crore brand.

With nine brands under your belt already, what led you to open your kitchen to third-party brands, like SLAY Coffee, Natural Ice Cream and Wendy’s?

In 2018-19, we realised that while we can operate multiple brands independently, many good brands in India don’t have the scalability, given their dependence on the brick-and-mortar format. But they have their own consumer missions that we wanted to address. So, why not partner with them? We have the power to scale them nationally, and even globally.

That’s how we got SLAY Coffee aboard in 2019, followed by Natural Ice Cream and Mad Over Donuts. That’s how Wendy’s happened. It is basically about scaling a well-known brand and providing culinary excellence, which is our forte. Since then, we have partnered with 15 brands, operating from our kitchens. Few of them are city-specific.

There was news about your losses increasing to over Rs 431 crore in FY19-20 from over Rs 130 crore a year before. How do you sail through such times?

While our losses did increase during COVID times, our profits also increased. Dubai and Indonesia are now profitable on complete operation metrics. Within six months of COVID, our sales were at 125-130 per cent of pre-COVID sales.

In India, we are now way ahead of our pre-COVID numbers. Due to our investments, Rebel Foods saw massive growth.

We are now also launching Messy Burgers in the UAE.

What’s the current growth rate?

In India​,​ we are witnessing around 20-25 per cent order growth (month-on-month). In fact, the April-June quarter has been really good, even though the Indian Premier League (IPL) was halted due to COVID.

The cloud kitchen space is getting competitive. Brands like FreshMenu, for example, have been raising funds…

The cloud kitchen market is too nascent. If it was an evolved segment, then there would have been positive competition.

FreshMenu is trying to give the consumers the best versions of the food that it is really good at. Meanwhile, we have a different food mission to achieve.

In COVID times, it's dangerous to belittle anyone as a competitor.

You rebranded Faasos to EatSure last year, bringing all your brands (Behrouz Biryani, Ovenstory Pizza, Sweet Truth, etc.) under one ‘roof’…

When it comes to food ordering, EatSure is more of a new category. Some of the app’s features don’t make it a food delivery app, but a food court app. It is about the convenience of ordering from multiple brands at one go. We want people to understand the relevance of this new category in the market. First, we want to establish that this category exists. Then, we will see the response.

EatSure is one of our major initiatives during COVID. We took assurances (on food ordering, quality check, delivery and packaging) to another level. Currently, it’s available in 45 cities.

What is the marketing strategy for EatSure?

Recently, we entered Amritsar, Jalandhar, Chandigarh and Ludhiana through our EatSure platform.

We haven’t done much marketing. We did newspaper ads in Kolkata and in the markets up north. Our creative teams carefully designed each ad to bring alive the USPs of ‘multi-restaurant’ in a single order.

We haven’t made a plan yet, but will have a campaign across TV and radio, along with digital. The budget allocation will be discussed in the upcoming quarter.

What’s your customer base like?

Currently, 23-25 per cent of the traffic on the (EatSure) app is through social media. We have a loyal customer base of around five million app downloads.

Let us talk about Rebel Foods and the challenges ahead…

If you don't concentrate on your unit economics, then you will not be profitable. What has worked for us is our scale and strong partnerships with our delivery partners.

We are not a single restaurant. We’re operating at a scale of almost thousand Internet restaurants on any given day. This is a factor for unit economics to maintain and, hence, cloud kitchen spaces are more lucrative than traditional business. Although, the latter has been successful as well.

Initially, the challenge was to introduce a new cuisine and doing market research around it. For instance, Ovenstory Pizza was entering a market dominated by the likes of Domino’s Pizza and Pizza Hut. Meanwhile, Behrouz Biryani was the first (outlet) to make an attempt to organise a disorganised biryani market. So, finding relevant space for each category may have been a challenge.

It’s more about product improvement than marketing. For instance, in Hyderabad, when people didn’t open up to Behrouz Biryani, which is a type of Persian biryani, we launched a Hyderbadi version and it took off very well.

What is your overall marketing strategy?

We have several criteria before getting into marketing. We ‘listen’ from various sources: social media, customer service and inventory… If we are launching a brand, we will not rest till it becomes a Rs 150-200 crore brand (annual run rate format).

For media spends, say, for Mandarin Oak, Ovenstory Pizza and Behrouz Biryani, we always go 80 per cent digital during brand launches. With digital media spends, we can go a bit hyperlocal.

Initially, we used to put in around five to 10 per cent of our monthly budget on social media. But now, we don't. Now, we see organic growth in our brand communities and keep driving salience through content marketing and social-first ideas.

Sometimes, we do spend more than 10 per cent on social media during celebratory events or big campaigns, because it lets us know what our customers are saying almost immediately.