Nestle wakes up to breakfast cereals

Nestle has set its sights on the Indian consumer’s breakfast menu. Breakfast cereals– a category where Nestle has a strong presence worldwide – is one segment the Indian subsidiary is planning an entry, Nestle India Chairman & Managing Director, Antonio Waszyk, says.

“It is one among eight categories we are looking at,” Waszyk says, though he is unwilling to give a timeline for possible launch of products in the segment.

Nestle has strong brands in the breakfast cereal segment including Nesquik, which is popular with kids, Cheerios, which is targeted at the family, and Cookie Crisp, among others.

Globally, the company has been investing heavily in the segment. In October last year, for instance, Nestle tied up with Cereal Partners Worldwide, which is the world’s second-largest cereal producer, to set up an innovation centre for breakfast cereals in Switzerland.

Nestle’s entry into the over Rs 500-crore breakfast cereal market will mean that it will take on incumbents such as Kelloggs’ and PepsiCo. The latter has Qaker Oats in India.

Industry estimates that the branded convenience breakfast cereals market is growing at a healthy 25 per cent and is likely to sustain this momentum for some time to be led by a higher retail exposure.

Though almost 80 per cent of the branded breakfast cereal market has been cornered by cornflakes, wheat porridge, white oats and muesli, as well as breakfast cereal bars are becoming popular.

But even as Nestle looks at getting its formidable breakfast cereal portfolio into India, it is not doing the same in the case of water and icecream – two segments where it has a presence internationally. “No, we are not looking at water and icecreams,” Waszyk says.

The company is stepping up its investment in existing categories including noodles, prepared dishes and cooking aids, milk products etc.

Beverages, which saw flat growth in the last calendar year, is being rejuvenated with the appointment of Bollywood actor, Deepika Padukone as brand ambassador of Nescafe. “We are looking at making Nescafe an active social experience,” Waszyk says. To achieve this, the company will increase the number of Nescafe vending machines from 4,000 to 20,000, besides using social media tools to push the brand.

The campaign featuring Padukone, for the record, will be launched next month.