'Ethnic' the big mantra for Heinz; to launch one big product a year

Firm to soon launch new aam panna variant of Glucon-D, the powdered energy drink that is the leader in the Rs 800-crore category

Ketchup maker HJ Heinz, which was acquired by Warren Buffett's Berkshire Hathaway and Brazilian investment firm 3G Capital last year, will launch more ethnic products in India as it looks to increase revenues from emerging markets. Nearly a quarter of the US-based major's $12 billion (or Rs 74,400 crore) revenues come from markets such as China, India, Indonesia, Russia, and Brazil. Individually, India, however, remains the smaller of the emerging countries, contributing about two per cent of revenues to the global kitty.

The mandate for the India team under MD Seema Modi, who took over operations in 2012, includes taking revenue contribution up from the domestic market. Modi will be using every lever from manufacturing, research & development, marketing and distribution to achieve this. Launching one big product a year is also on the cards for which the company  will utilise its manufacturing facilities at Aligarh in Uttar Pradesh and Sitarganj in Uttarakhand.

Ethnic products, in particular, Modi says, will ride on the company's R&D strengths as well as its ability to  guage consumer needs  both at the national  and regional levels. Heinz will soon launch a new aam panna variant of Glucon-D, the powdered energy drink that is the leader in the Rs 800-crore category. Modi says that the product is being placed at retail stores across the country at the moment, and will be launched at a price point of Rs 20. Heinz reaches almost 1.4 million stores across India, with almost 80 per cent located in urban areas. The 20 per cent retail presence in rural areas is expected to grow as Heinz beefs ist distribution reach in these areas. Ethnic products are also expected to help the company in this endeavour to grow its rural presence.

The aam panna variant will be the second local flavour under Glucon-D, the first being nimbu pani. Under  flagship Complan, the milk food drink, Heinz has two ethnic flavours Pista Badam and Badam Milk. More are expected to be launched, Modi says as the company looks to expand the equity of Complan beyond urban areas.

While Complan is the leader in  milk-based beverages , which constitite  about  30-35 per cent of the Rs 5,500-crore overall health food drink market, the challenge for the brand  is  to replicate this on the malt side, which constitutes 65-70 per cent of the market. The leader here is Horlicks from GlaxoSmithKline  Consumer. Competition in the last few years has also grown from Bournvita, the malt drink from Mondelez. A malt variant of Complan could be launched, Modi said, without  giving  specific details.

Heinz will also fortify its prickly heat powder Nycil, the leader again in the Rs 800-crore category, with local ingredients. The company in recent years has launched variants such as sandalwood, neem and gulabjal (rose petals) under Nycil. This process is expected to continue, she adds. The company's focus on ketchups, however, will be muted as rivals Nestle and Hindustan Unilever remain big players there.

"We will selectively launch products under ketchups," Modi adds.