Parle Agro bets on ‘beer-like’ apple drink to expand fruit fizz portfolio

In a fresh attempt to grab market share in the fizzy beverage category, Parle Agro has launched B-Fizz, a malt flavoured carbonated drink (apple-based). B-Fizz is the latest addition to the company’s fruit plus fizz product portfolio. It already includes its flagship brand Appy Fizz.

Parle Agro had tried to expand its fruit plus fizz portfolio in the past, with the grape flavoured Grappo Fizz (2009) and the mango flavoured Frooti Fizz (2017). The initiatives did not last as long as Appy Fizz.

Appy (sans fizz) was launched in 1986. Appy Fizz came about in 2005, and currently holds over 90 per cent market share in the fruit plus fizz category. Like Appy Fizz, Parle Agro expects B-Fizz’s acceptance in both the urban and rural markets.

While the malt flavour is a major leap, the company has also played safe by making it an extension of its already successful apple drink. Malt-based flavours have been the domain of alcobev (alcoholic beverage) brands for long. Brands like Kingfisher and Heineken have launched non-alcoholic beers. (Kingfisher’s Radler offers flavours like Lime and Ginger.)

This has traditionally helped alcobev brands tap consumers and revenue streams beyond the regular alcohol TG. While the space has older names like Bavaria 0.0%, it also has young players like Coolberg. Among the latest entrants is Barbican from Coca-Cola, which was launched in India in August last year. Barbican offers several fruit plus malt flavours.

Reports suggest that India’s demand for non-alcoholic beers is growing well and is particularly appealing to the youth. A Parle Agro press release states that B-Fizz’s “malt flavour mirrors a strong taste of beer” and the brand is targeted at the youth (15 to 35 years).

In a conversation with afaqs!, Nadia Chauhan, joint managing director and CMO, Parle Agro, asserts that while B-Fizz has a malt taste, it is not a non-alcoholic beer. “It is a completely different category.”

We asked Chauhan about the choice of malt plus apple as an extension, and not another fruit flavour. Chauhan responds by saying that (especially) with a highly penetrated brand like Appy Fizz at the core, the product extension too needed to reflect this. “It is a product that delivered our requirement from the brand extension standpoint.”

In 2019, Appy Fizz had a market share of 73 per cent in the apple-based beverages category, and over 90 per cent share in the sparkling fruit drink category. Sparkling fruit drink is part of the larger CSD (carbonated soft drinks) market, and is currently valued at over Rs 1,500 crore. Parle Agro is betting on B-Fizz to build the fruit plus fizz category to Rs 10,000 crore by 2030.

The brand has roped in actress Priyanka Chopra Jonas as the national brand ambassador and Jr. NTR as the brand ambassador for southern India.

While most of the malt flavoured offerings are above Rs 50 price point, Parle Agro has retained the Rs 10 (160 ml) SKU (stock keeping unit). This too at a time when all the major fizzy beverage brands have departed from the Rs 10 pricing.

“We introduced the 160 ml pack at Rs 10 about a year ago. This has allowed for the availability of the product in over five lakh outlets in the country in less than two weeks from the launch. It is a very important price point for the beverage portfolio, and even in other categories like chocolates, etc. It is not just a great trial generation pack, but also a huge volume driver,” says Chauhan.

She adds that Parle Agro has been able to maintain the Rs 10 price point in its beverage portfolio for over a decade now. “This is where technology and efficiency plays a big role. A lot of innovation in technology has helped us sustain the price point.”

Fizzy beverages usually hits markets ahead of the mid-year/peak summer months. This is followed by sustained advertising to make the most of the following festive season. Parle Agro plans to spend Rs 40 crore in marketing and advertising across TV, print and digital over the coming months.

Chauhan says that the plan was always to launch after the COVID-induced lockdown was lifted across markets. “India sees two summers in any case. There’s always a first summer and a second one. We just got out of the monsoons, and it is a great opportunity to look at infusing the market with something new after the massive impact of pandemic. Things are slowly getting back to normal. There is a great spurt in out of home consumption again, and the on-spot (Rs 10) packs play a big role.”

She adds that now, retailers are welcoming new products a lot more openly than the last few months. The company is busy ensuring sufficient supply to meet the (growing) demand.