In an effort to increase its market presence and fend off competitors, Nestle’s well-loved product, Maggi, will soon be available in INR 10 packets, as reported by Mint. This strategic move aims to recapture market share in smaller towns and villages by offering an appealing price point.
According to the report, the Indian division of the Swiss company initially offered a 100-gram Maggi pack for INR 10. However, in December 2014, they increased the price to INR 12, and this was further adjusted to INR 14 in February 2022 to counter the growing input costs. The newly introduced INR 10 package is specifically aimed at capturing the “Rurban” markets, which encompass rural and smaller markets, across 15 states, and will contain only 40 grams of product.
Price markers like INR 5 and INR 10 are more memorable and are commonly seen as budget-friendly options by consumers. This is particularly applicable to economical consumer products like fast snacks, biscuits, and shampoos.
According to the report, a representative from Nestle India mentioned,”There is an increasing preference for spicy products all across India. Maggi has always been in tune with what our consumers that meet this need. We already have Maggi special masala, Maggi spicy garlic and Maggi manchurian noodles in urban markets. For “rurban markets, we recently launched “Teekha Masala” and “Chatpata Masala” variants of Maggi noodles for INR 10.”
As per the Mint report, industry experts have expressed a favorable view of Nestle India’s reemphasis on INR 10 stock-keeping units (SKU), a move that is well-received by channel partners. This expansion of smaller packs into untapped markets aligns with Nestle’s efforts to penetrate deeper into India’s markets. In its annual report, Nestle noted that it had extended its reach by entering approximately 55,000 villages and establishing 1,800 new distribution touchpoints in 2022.
The latest decision is aimed at maintaining control over local competition, particularly as smaller companies have gained ground due to a decrease in inflation. According to a research report cited by Mint, local brands have outperformed national brands in terms of volume growth in the 12-month period ending on April 30. Local brands, in this context, refer to brands that operate exclusively within a single market.
In the year 2022, Maggi noodles accounted for 32.2 percent of the company’s sales within the domestic market, as indicated by the annual report. Moreover, Maggi holds a market share of over 60 percent in the packaged noodles segment within the country.