Lay's goes in for new flavour: Co-creation

Frito-lay’s latest campaign comes in the backdrop of a volume war.

Companies will need to interact with their customers so closely that they actually “co-create” value with them on an individual basis.
— C K Prahalad in his book The New Age
of Innovation, published in 2008

The top brass at Frito-Lay, the foods division of PepsiCo India, is taking the management guru’s advice quite seriously.

Frito-Lay’s new campaign for Lay’s – “Give Us Your Dellicious Flavour” is giving consumers an opportunity to co-create the flavour they like for Lay’s. The winner will receive a mega prize of Rs 50 lakh plus 1 per cent of the sales turnover from the new flavoured snacks, which will be launched by the end of May 2010. Consumers can send in their entries by post, drop boxes, email, website and SMS.

Deepika Warrier, Frito-Lay's executive director, marketing, is excited. “Personally, I am keen to see what interesting and innovative flavour ideas India will give us," she says. The campaign, executed by JWT, is to reap "interactive" benefits as consumers love to own brands.

The commercial begins with Saif getting himself a tattoo on his forearm. When he sees the tattoo, he realises that the artist has tattooed 'kareepatta' (curry leaves) on his arm, which is the former's favourite flavour. He storms out of the place with a pack of Lays, when he sees a man with a red and green tattoo saying 'tomato chutney'. Similarly, a girl with raw mangoes tattooed all over her says 'Kacchi Ambi'. In the end, Saif ask all of them to tell Lay's about their favourite flavour.

Ad gurus are quick to endorse the brand strategy. “Brands of the future will be owned by consumers and not the marketers,” says Ashish Mishra, business head and chief strategist, Water (Mudra’s strategy and design consulting arm).

An increasing number of companies (Frito Lay’s competitors included) are doing precisely that to drive up engagement levels and interactivity with consumers. Frito Lay, for example, had launched a similar campaign last year which asked consumers to vote for the flavour of their choice between the new launches - Spunky Pimento and Balsamic Blast. Titled 'Fight for your flavour', the campaign had Saif Ali Khan and M S Dhoni. Even Kurkure ran a campaign which asked consumers for recipes. The winning entrant’s family was featured on the packets of the snack.

Lay’s is the leader with a market share of around 48 per cent, Bingo has 13 per cent and Parle’s Musst Chips and Musst Stix have a combined 5-7 per cent market share. But the new Frito-Lay campaign comes in the backdrop of a volume war among the three players (Frito-Lay, ITC and Parle). ITC recently added 50 per cent more content to all its Bingo packs without increasing prices. Lay’s followed with 20 per cent extra content and Parle Products with 50 per cent extra on Musst Chips and Stix.

Recently, Parle launched Monaco Smart Chips, which it claims, is the only baked chips and hence being positioned in the healthy category. Parle is eyeing a 25 per cent market share through an aggressive marketing and distribution strategy. Parle has signed Aamir Khan for Smart Chips.

But Frito-Lay is unruffled. It says that it has already taken the “health positioning” into account. "We have been innovating continuously in the health and wellness area under our "snack smart" programme. We’ve ensured that Lay’s offers consumers great tasting chips made from the freshest, best quality natural potatoes, made from best quality seasonings which contain zero MSG, and are cooked in rice bran oil (40 per cent less saturated fat) and contains zero trans fats," says Warrier.

It’s not clear whether Lay’s will also follow Kurkure into the lower price segment. Kurkure is now available also at Rs 3 a pack, while Lay’s is available in Rs 5, 10 and 20 price points.