Beverage firms betting big on launches to add fizz to summer sales

Mumbai-based Parle Agro, the maker of Frooti and Appy Fizz, is hoping that the scorching summer will bring cheer to its beverages' brands this year.

 

After a challenging summer last year, which was marred by the Covid-19 pandemic and lockdown, enthusiasm at the firm is palpable. The company has set a 50 per cent target in terms of sales growth this year over the summer of 2019, pushing both small and large packs across its portfolio.

 

From 160-ml units to one and two-litre packs, the company claims it has a range of products for both on-the-go and in-home consumption. However, a resurgent Covid-19 wave could pose a threat to the summer plans of beverage companies, said experts.

 

The reason is the flu-like symptoms of coronavirus, which may force consumers to reduce intake of cool beverages like ice-creams, soft drinks and chilled beverages. And, a reduction in consumption will hurt the business prospects of beverage firms, who depend on summer for their sales. The April-June quarter contributes over half of the beverage industry’s annual sales in India. “The April-June period of 2020 was disrupted not only because of lockdown curbs imposed to reduce spread of the virus, but also because people were staying away from consuming chilled drinks. If the second wave gets stronger, there could be a similar pattern of behaviour this summer too,” said Arvind Singhal, chairman, Technopak.

 

India reported over 68,000 new coronavirus cases on Monday, with states such as Maharashtra, Punjab, Karnataka and Madhya Pradesh among key contributors to the case load. This isn’t all. The out-of-home market, including hotels, restaurants, cafes and eateries, a key segment for beverage companies, remains muted on account of the extended lockdown curbs across small and big cities. While most beverage companies in the last one year have turned their attention to modern and traditional trade as well as e-commerce to drive sales, experts feel this may not be enough.

 

The out-of-home market typically contributes two-third of the sales of beverage companies, said experts. An impact there will hit companies hard as it did in the summer of 2020, when beverage companies such as Coca-Cola had to write off unsold inventory due to lockdown curbs.

 

Yet, beverage firms are not giving up yet. PepsiCo India has unveiled new campaigns with some of its key brand ambassadors, including Salman Khan, Katrina Khan and Hrithik Roshan this year for brands Pepsi, Slice and Mountain Dew Ice, respectively. The latter (Mountain Dew Ice) is a global brand, whose format has been tweaked for the India market. In February, the company had indicated that it was launching Mountain Dew Ice in a “cloudy lemon format” in India after extensive consumer research.

 

For Pepsi, a company spokesperson said the firm was launching a 360-degree campaign, while Brand Slice and PepsiCo’s mango juice drink were promoting a blind taste challenge to build excitement.

 

Coca-Cola, meanwhile, is making its drinks available at affordable price points. And Parle Agro has unveiled a high-decibel campaign for Frooti, featuring actor Varun Dhawan. It proposes to roll out new stock-keeping units for its recently-launched B-Fizz. The company has also tied up with the Indian Premier League next month, with plans to push Frooti on television and B-Fizz on the digital medium.