Revitalising the market
Dalda
is back with a bang. Purabi Naha takes a peek at its re-launch by Bunge
India and finds out why Dalda is growing even in a torpid market for
vanaspati
The
brand 'Dalda' stands for its
heritage, trust and robust, vibrant life. This is what sets it apart
from most edible oils that have taken a healthy position. Bunge India,
a 100 per cent subsidiary of Bunge Limited, recently re-launched the
mother brand in vanaspati, Dalda, in two variants – Refined Soyabean
Oil and Refined Sunflower Oil.
Ameliorating
the brand
Any re-launch comes with its own set of challenges. Although the brand
was very strong at one point of time, it needed to be re-vitalised because
by the time Bunge India bought it from Hindustan Lever Ltd (HLL), the
industry had gone into a spell of downhill growth. So, after consumer
research, the paramount task was to build the quality perception, since
most vanaspati brands had started compromising on the quality. Bunge
India did an intensive 'consumer contact programme', something what
HLL had done 36 years ago when it had started promoting the concept
of vanaspati. "We go from place to place and actually cook on the
roadside and let people taste and get the feel of the new quality of
Dalda. And we did this through vans in 420 towns with a population of
100,000 and above. That did a lot of good for Dalda's imagery of quality,"
says Adhiraj Sarin, MD, Bunge India. He further adds,"The second
challenge we had was once we took over the Dalda brand, we had a threeyear
threeyear.contract
with HLL that they would continue distributing. We knew that three years
is not a long time. So, we had to start building our own distribution
system. And the transition had just started in December last year and
it just completed in July this year and we built a complete national
distribution chain ourselves.
"
The Indian vegetable oil market
Unfortunately, the Indian hydrogenated vegetable oil market is not well
defined and does not show colossal development. In fact, for the past
five years it has shown a decline. According to Mr Sarin, this year,
for the first time it has shown about two per cent growth. This reflects
the fact that customers use vanaspati basically for cooking snacks and
savouries. It is the halwais who would sometimes go for large packs
of vanaspati. So, there are a very few people who actually do the daily
cooking using vanaspati. "People are shifting more and more to
edible oils. At one point of time, vanaspati was the cheapest source
of cooking fat. But today the cheapest source is an edible oil like
palm or soyabean, and that's what is really growing." At present,
the vanaspati category is very much static.
The
success ingredients
Mr Sarin is of the opinion that good quality, proper availability
of the product in the market and brand promotion would definitely pave
the way for growth. This is the reason why even in a declining market
this year, Dalda has grown by 12 per cent. "So we really are seeing
a market-share improvement with Dalda because many customers who had
got a bit frustrated with the quality of vanaspati in the market are
saying that if they want to use vanaspati, they would use good quality
and prefer to buy Dalda," he elaborates. Two areas are responsible
for growth. One is the marketshare of Dalda and the other is the extension
of Dalda to the edible-oil category. On the pricing front, Mr Sarin
comments,"Dalda's strategy has been to become a premium brand.
Because we give premium quality, we expect to get a slightly better
price.".
Thriving
for perfection
Regarding vanaspati, there are some strict Government-compliance
issues. For example, vanaspati should not have a melting point above
41°C since it is inappropriate for digestion, as specified by the
Government. Mr Sarin confidently remarks, "We ensure that our vanaspati
will never cross 41°C melting point for strict quality practices.
The unfortunate part is that most vanaspaties in the market arrive at
41°C, but Dalda has to make sure that it complies with the food
regulations." He further says, "We do it by two ways. One
is that quality is ensured in the process and the other is inspection
after that. So we spend a lot of time on the process, ensuring that
we use the right-quality vegetable oils and refining equipment. For
instance, we will never transport our oils or crude oils in mild steel
and we ensure that they come in, for example, stainless steel, so.
Bunge
India's recent achievements
Recently, Bunge acquired assets of Gee Pee Ceval (two units) and
Prestige Foods, which include an oilseed-processing unit and integrated
vegetable oil refinery and packaging facility. These two units (one
at Bundi near Kota and the other Pitampur near Indore) are basically
crushing plants for soyabean/mustard seeds. These are utilised for manufacturing
oil (sold both in bulk in packaged form) and cakes (for poultry feeds
or for export). The crushing capacity is about 800 tonnes per day and
the refined oil capacity is 150 tonnes per day in each plant. Bunge
India has also acquired a brand called Chambal, which has 30 per cent
share in Rajasthan market. In Pitampur, Bunge has shutdown it's unit
for time being because the soyabean season has ceased early in Madhya
Pradesh. The season will begin in October, and Bunge India intends to
encounter new ways of running the plant, not only by using its own people
and labour but also through contract management that there is no metal
contamination. After we have done the right process, then of course
we have an inspection process, which ensures that good quality is going
to the consumer and is absolutely 100 per cent compliant.".
