A blessing for milk consumers?

MabrookThe launch of a chain of milk shops called Mabrook sees Engro Foods venturing into the loose or fresh milk (khula dood) segment.

Mabrook is a test market project that will be piloted in Karachi only in the first year. The first retail outlet was launched in mid-November last year in Federal B Area, followed by others in December. Two to three shops will be launched every other week until Engro reaches its first year target of 30 shops.

According to Salman Goheer, Director Fresh Dairy Business, Engro Foods, the company entered the milk market in 2006, gaining market leadership in the UHT segment in 2009, and since 2012 it has enjoyed a market share of over 50% with brands like Olper’s and Tarang now household names. The next logical move, says Goheer, was to tap into the bigger chunk of the pie, which is the loose milk segment. Pakistan is among the top five milk producing countries in the world with an annual production of between 34 to 35 billion litres of tradable milk (the official figure keeps changing); Engro Foods’ internal estimate is at approximately 20 billion litres. The segment accounts for 92% of the tradable milk produced while packaged and powdered milk have an eight percent share, although the latter segment has been growing steadily since 2003.

To ensure continued and rapid expansion in the milk category, Engro has now decided to place itself at the front end of the value chain. Mabrook’s target consumer group is mainly the middle income segment and Engro will be matching the current prices for milk and yoghurt (Rs 78 per litre and Rs 110 per kilogramme, respectively).

Given that in Karachi, 90% of the loose milk is sold through shops, Engro has set up a franchise-based business model to operate the Mabrook shops. The company has identified 16 of its 30 franchisees and aims to reach its target in the next five to six months. Mabrook shops will be located in Gulberg, Gulshan-e-Iqbal, JamshedTown, North Nazimabad and Saddar although the exact locations are still under evaluation for visibility and easy access.

The criteria for selecting franchisees include reputation, financial strength and market history. Engro will handle the back end of the operation to ensure the smooth delivery of the milk to the shops and to this end has created its own milk procurement infrastructure; the milk is collected from areas within a 100 kilometre radius of Karachi and the processing plant is based in Korangi.

Goheer expects the company to face multiple challenges in this new venture, which is why Engro is test marketing the concept. Among the challenges are managing a one-day shelf life product, and ensuring consistent quality and hygiene inside the shops.

The venture will require Engro to invest over a billion rupees in 2014; so far the company has invested approximately Rs 200 million in infrastructure alone. Investment will also go towards establishing strong systems and training people to ensure that hygiene protocols and standards are followed by the franchisees. The design and layout of the Mabrook shops has been geared to guarantee that the product does not attract high bacteria counts as the day progresses.

Apart from the internal challenges of quality, shop design and implementation, Goheer says the biggest external challenge is the law and order situation in Karachi. For example, if the city shuts down for five days, Engro will have to figure out how to store the milk safely.

To ensure continued and rapid expansion in the milk category, Engro has now decided to place itself at the front end of the value chain.

The venture is not expected to affect Engro’s share in the packaged UHT segment as it caters mainly to SEC A+ (and to some extent SEC A) consumers and the company does not anticipate any overlap between the two segments. On the other hand, there is a lot of competition in the loose milk category with countless unbranded milk shops operating in Karachi, although the conditions there tend towards the unhygienic, and adulteration is common.

Goheer says, “Engro now has an efficient knowledge base in terms of milk. We will be able to deliver a good and consistent quality product in a very hygienic way to our customers, and this is how we will move against our competitors. Engro is deeply rooted in Pakistan, with a 50-year history, so the name helps a lot in attracting people to work with us and in reaching out to customers. We have sufficient experience with operational controls and will use it to keep a quality check on the Mabrook franchisees.”

In terms of the marketing strategy, the focus will be on ground activities and these are scheduled to start in the next couple of months. The name Mabrook is derived from the Arabic words barkat (abundance, auspicious) and mubarak (blessed) and has been endorsed by consumer research.

After the one year test marketing period in Karachi, Engro hopes to expand to other parts of Pakistan. Goheeer predicts that “we will rapidly expand next year. This year will be a learning platform and we will move forward according to our experience in the market. We are creating a new channel and once it proves successful, I am sure other companies will follow, which will be good for the consumer and the industry.”

First published in the January-February 2014 issue.

PRESS RELEASE: Chatterbox Café Brings Innovation To Town

blah

Pakistan’s premier bakery, Pie in the Sky’s newest café, Chatterbox opened its doors in DHA – Phase VI, Karachi. Chatterbox Café promises to bring innovation to the city’s food map with the launch of its new café. The café that grew out of a bakery, previously introduced Karachiites to the idea of a bakery-café for a unique dining experience.

“Chatterbox was initially an extension of Pie in the Sky, since there was no concept of having a seating area or a café with a bakery in Karachi; we introduced the idea for the first time in Karachi. Chatterbox evolved from there. Since I like to challenge myself, I decided to start this new venture to take Chatterbox in a new direction. Also, what drives me is the love and passion for the brand,” said Naila Naqvi, Owner Chatterbox.

Naila with friends

Naila Naqvi, Owner of Chatterbox, entertaining friends at the new café

The launch of the new café, located at Bukhari Commercial, brings with it a fusion of cuisines that are yet to hit Karachi. Breakfast items such as Shakshuka — a Mediterranean dish of eggs poached in a spicy sauce of tomatoes — and Beef Rice Bowl bring an element of exclusivity to the menu. Dishes that are not available in other cafés and restaurants also include Savory Granola and tantalising desserts for those with an insatiable sweet tooth, such as Caramel Budino with salted caramel, White Chocolate and Raspberry Cheesecake, and Sticky Toffee Pudding. To maintain the taste and quality, the management imports most of the ingredients; Swiss chocolate is used for desserts that require chocolate and fresh fruits.

food

The café has a country and rustic feel to it, thanks to the antiques and brick walls. “The idea was to create a comfortable and welcoming environment. We started off with antiques and brick walls to give it a rustic feel. The furniture and lights are from Dubai to create an edge,” said Naila Naqvi.

blah2

A new diner is always welcome in Karachi, provided it keeps up with the foodies’ expectations. Chatterbox is sure to live up the expectations after setting a standard with its bakery café. If you are a food lover and looking for exquisite and innovative menu, Chatterbox’s menu is sure to surprise you! The café has not set a specific target market in mind, as all those who appreciate exquisite flavours are welcome.

Going tomatoes

By Ayesha Hoda

Published in Aurora Magazine (September – October 2012 issue)

Image

The ketchup category has seen advertising activity recently and there are lots of tomatoes to be found whether you switch on the TV or look at a billboard.

The story of tomato ketchup in Pakistan began with Mitchell’s – a food brand that dates back to the 30s. The category has changed significantly since and more brands have entered the market. Today, the category is populated by names such as Bake Parlor, Knorr, Mitchell’s, National Foods, Shangrila, Shezan, and international brands like Heinz.

According to Adnan Malik, Head of Marketing, National Foods, the tomato ketchup category is worth three billion rupees (Source: A C Nielsen) and his brand accounts for 51% of the share. He says that there is a 70% penetration of this category in consumer segments A1, A2, B and C. In sharp contrast, the penetration levels go down to 30-40% in B, C and E.

Since the 90s the strategies for ketchup brands have evolved. Inflation and the economic downturn have seen cuts in consumer spending and brands have turned to offering their customers convenience and economy.

To this end, Shangrila (established in the late 80s) introduced a 100g sachet in the late 90s and became the first company to launch pouch packaging, a development that raised the bar among competitors and also brought the price down, helping develop a market for ketchup among a wider public.

National Foods quickly followed suit and today claims to be the leader in this format. Pouches account for 60% of the company’s sales and even consumers who are not price sensitive and previously preferred bottles, have accepted pouches due to their convenience.

At Mitchell’s, although concentration on pouches has recently increased, glass bottles still account for a 40-50% share of their sales.

Pouches come iin three sizes: 800g, 400g and 250g, and glass bottles in two: 500g and 280g. For all the brands the large (800g) pouch is priced at about Rs 150 whereas the large (500g) bottle is about 10-15 rupees cheaper. However, there is a smaller quantity of ketchup in the bottle, therefore by paying a little extra, consumers get more ketchup, making the pouch more economical.

Most ketchup brands are concentrating on younger consumers, because, says Malik, “We are a a young nation and the trend of having snacks with ketchup is growing.”

However, a major challenge is to ensure that the brand appeals to everyne, including housewives and other influencers.

In terms of advertising strategy, National Foods, Shangrila and Mitchell’s all seem to be focusing focusing on the main ingredient – tomatoes.

National Foods originally positioned (before 2008) their proposition around fun. However, in 2008, the package design was changed to emphasise the fact that the product was made from 100% pure tomatoes, with the focus of the communication turning towards flavour and purity of the ingredients. The company’s recent ad campaign is also based on ‘The real tomato experience’.

According to ad agency IAL Saatchi and Saatchi (National Foods’ creative agency), the new campaign capitalises on benefits such as purity, quality, convenience and economy through tempting shots of food and tomatoes. The campaign was leveraged to television, retail level (POS) and gondola/displays at shops.

Shangrila leverages print and outdoor and does not advertise on TV or radio as the company believes it is against sharia’h to do so, which is why, according to Erfan Mirza, Brand Manager, Shangrila, the brand has a low share of voice compared to its competitors. Yest, he says that Shangrila is still considered Pakistan’s number one tomato ketchup.

Compared to National Foods and Shangrila, Mitchell’s ad spend was relatively low until about three years ago, because of a focus on infrastructure development. However, advertising activity has picked up since. Zakria Fawad, Account Manager, Lowe & Rauf (Mitchell’s creative agency), says the current ad campaign for Mitchell’s tomato ketchup (Bin khaye raha na jaye  – originally released in 2010) stresses the fact that the product is made from the highest quantity of tomato pulp.

Fawad adds that “strategically, we decided to target the younger age group as they are the primary users/influencers but we also incorporated the primary buyer, the mother.”

In addition to the TVC, Mitchell’s is exploring non-traditional marketing avenues. It currently sponsors a food magazine called Chef Special and Chef Zakir’s annual cookbook. The brand has also opted for content integration on Dawat on Masala TV.

Faiza Iqtadar, Media Planner at Maxus Global (Mitchell’s media agency) says, “The brand’s media strategy is to increase awareness, create recall and promote its discounted offer.”

Overall, things look good for the ketchup brands. All the major players have become more aggressive on the marketing front and the size of the market is growing simultaneously. These brands are also looking to explore more consumer segments. Hamid Mukhtar, Assistant Brand Manager, Mitchell’s Grocery Products, for example, says that Mitchell’s has recently changed their penetration strategy from A+ and A consumers to target people in the B and B+ range.

However, as more ketchup brands are providing more options to snack lovers, the big brands may need to think of new ways to differentiate their product apart from the claim of being ‘natural’. They will also have to come up with more innovative media mixes to remain relevant and appeal to various consumer segments.

The Noodle House @ PC

Last week I had the opportunity to try out South East Asian cuisine for the first time (I’ve only had Thai food a few times before this).

Instead of a typical PR event – like the corporate ones I am used to and was expecting – this was a more informal and entertaining one, where each guest was allowed to order food of their choice. So I got a chance to try out a number of dishes with some fellow bloggers and foodies.

Wok fried honey and sesame chicken

There were specialties from Hong Kong, Malaysia, Shanghai, Bangkok and Jakarta.

This is the first outlet of Noodle House in Karachi. Its first restaurant in Pakistan was opened in Lahore last year. According to the official press release, it’s an international brand launched in 2002, which has a number of restaurants in the Middle East.

Overall, it was a good and different dining experience (with an open kitchen and modern interiors). Anyone heading to Pearl Continental in Karachi should try it out. My favorite dish from amongst the ones I tried – also had Wasabi Prawn, vegetable fried rice, Thai beef salad with Nam Jim dressing and Chicken satay with peanut sauce – turned out to be this:

Thai chicken with cashew nut