Analysis of quick snack industry with a creation of new brand.

1. University School of Management & Entrepreneurship
Delhi Technological University
Advertising & Brand Management:
Crispies
under the guidance
of
Prof. Harleen Kaur
Submitted On: ​​22nd October, 2018
Submitted By: Group 2, MBA 3rd Sem
1) Mansi Solanki (2K17/MBA/728)
2) Milan Shukla (2K17/MBA/729)
3) Nandini Bansal (2K17/MBA/732)
4) Nupura Raj (2K17/MBA/736)
5) Prabal Malhan (2K17/MBA/737)

2. Introduction & Reason for selecting Chips Industry:
Potato chips currently represent one of the world’s most popular snack foods. From its accidental
birth in 1853, the potato chips market has evolved with time and currently represents a
multi-billion dollar market. Owing to their easy affordability and cheaper price even for the
premium products, potato chips are popular among all age groups. Currently, the growing young
population (below 15 years) represents a key segment for the potato chips market. Major factors
driving the global demand of potato chips are growing urbanisation, rise in disposable incomes
and rapidly changing lifestyles. A busy lifestyle coupled with long working hours have forced
people to shift from elaborate luncheons and meals to desk snacks and packaged foods. Other
factors like value addition and growth of emerging markets are also expected to propel the
demand of this market. According to IMARC Group, the global potato chips market has grown
at a CAGR of around 4% during 2010-2017 and reached a market value worth US$ 28 Billion.
Although potato chips are consumed all over the world, their consumption and penetration levels
vary widely across regions. The United States and Western Europe currently represent the
biggest markets accounting for nearly two thirds of the total global demand. Growth rates in
these markets, however, have reached maturity levels whereas the emerging markets such as
India, China, Russia, etc. are expected to show promising growth rates in the future.
Macroeconomics environment in india and its effect on pepsico
Pepsico gained entry to india in 1988 by creating a joint venture with the punjab govt. owned
punjab agro industrial corporation and voltas india limited. This joint venture marketed and sold
lehar pepsi until 1991 when co branding was necessary. However post globalisation when the
use of foreign brands was allowed pepsico bought out its partners and ended the joint venture in
1994. From then onwards lehar pepsi ceased to exist & pepsico started using its own brand
Political environment
Post globalisation in india in the early 90s pepsico bought the majority of the snack brands in the
market like uncle chips, fun munch binnies etc.they chose to continue some brands like uncle
chips but did away with the others. They could go ahead with these acquisitions as the incumbent
government deregulations allowed them to do the same
Economic environment
In the eighties the indian populace had a cost conscious mentality as far as snacks were
concerned. They would rather but the local savouries than go for a packet of chips(100gms)
Which would cost around rs 2-2.5. However post globalisation the disposable income of the
average indian started increasing. As a result people could afford branded snacks instead of the
locally made ones at the kirana stores. Pepsico took full advantage of this and extensively
promoted its snacks with an added price premium.
Social environment
With the economic liberalization society grew liberal as well . now, people consuming branded
items were not considered pompous or show offs. Rather the trend for fmcg goods started
shifting towards premium and value for money from cost consciousness. Thus the sales volume

3. of branded fmcg goods were increasing . promotion became a primary competitive tool which
pepsico started excelling at.
Technological environment
Product quality became a primary concern with the advent of technology. Whereas the local
brands had no quality check so as to speak, pepsico made sure that its snacks were made with the
state of the art technology with minimal human contact. The plant workers were also garbed to
protective clothing which made the contact environment highly sterilized. Snacks prepared in
unhealthy conditions could lead to salmonella or e.coli poisoning . also the vacuum sealed packs
of pepsico became the market standards replacing local heat sealed plastic packaging.
Legal environment
Pepsico took full advantage of the lack of antitrust laws in india to acquire a large section of the
indian snacks industry. Nowadays any shop would have pepsico branded products in half of its
snack product portfolio. By the time the laws were amended, pepsico has a major head start in
the market and continuous to be the market leader today in the snacks category.
Environmental
Changing norms regarding plastic packaging are one of the crucial factors which could affect the
FMCG industry as majority of consumables are packed in non-degradable plastic.
Industry attractiveness (Porter’s 5 force analysis)
Threat of a new entry
● As the market is growing at 15-20 percent annually, new entrants may consider it a
profitable venture.
● As branded players are priced similarly, new players might penetrate by adopting a lower
or by offering more grammage at the same price(balaji’s strategy)
● New players with a distinct USP and marketing strategy may find it easier to enter the
market (bingo strategy)
● Unorganised players still account for half of the total wafer segment thereby discouraging
market entry.
● Veteran players such as Frito-Lay, Haldiram etc enjoy economies of scale,
well-established distribution and good distributor relations.
Hence, the threat of new entrants is moderate.
Industry Attractiveness
Competitive Rivalry
● High Competition - Branded players involved in cut-throat competition to increase
market share, entice new consumers, find new markets.
● Low Quality differences among branded players.

4. ● Quality difference between branded and unbranded offerings is offset by low price
offered by unbranded players.
● Cost of switching is low as all players have a similar pricing strategy.
● Brand loyalty is high for branded players.
Hence, the threat of competitive rivalry is high.
Bargaining power of suppliers
● Suppliers provide raw materials such as potatoes spices and other ingredients . their
ability to raise input costs is high
● Higher costs of input commodities lead to lower margins making the market unattractive
for distributors and retailers (in an already low margin high volume market)
● Shortage of any input material may also affect production and thereby impact
distribution.
● Veteran players like frito lay and ITC already have a well established network of
suppliers.
ITC’s e-choupal permits a steady supply of raw materials at the lowest price . hence, the
bargaining power of suppliers is high.
Bargaining power of consumers
● Frito-Lay enjoys a healthy lead with a 45 percent market share for it’s portfolio of
products.
● Competitor differentiation is in terms of variants and communication.
● Ability to substitute is high as brands are priced similarly and distribution problems for
one brand promote sales for the other.
● Price sensitivity is high. An increase in the price of Lays may promote a switch to Bingo
for most buyers (except for loyalists).
Hence, bargaining power of consumers high.
Threat of Substitutes
Biscuits, Wafers and local snacks like Chakli, banana chips, farsan etc are all substitutes of one
another. Hence, the threat of substitutes is high.
● Indian Snack segment is high-volume, low involvement driven.
● All snacks are considered to be substitutes of each other.
CONSUMER BEHAVIOR
The job of marketer is to meet and satisfy target customer’s requirements and desires. “Knowing
customer" is not a simple task.Understanding the buying behavior of the target market for the
product is the essential task of the marketing plan. The job of the marketers is to “think
customer” and to guide the company into developing offers, which are meaningful and attractive
to target customers and creating solutions that deliver satisfaction to the customers, profits to

5. customer and benefits to the stakeholders.Marketers must study the customer taste, preferences,
wants,shopping and buying behavior because such study provides the clues for developing the
new products, price, product changes, messages and other marketing mix elements.Consumer
has various type of behavior patterns. Few of them are explained as follows;
Picking:​​involves a random choice, here the buyer picks a brand from the available brands, and is
indifferent to the brand he buys. Picking occurs when the consumer has
(a) ​low involvement ​in the purchase, (b)there is ​little uncertainty with untried brands
(c) there are ​few differences between the brands
Variety seeking​​:​another example, also involves ​low consumer involvement ​, but it requires
significant differences between the brands​(Assael, 1987). Variety seeking was also found when
(a) purchases are made for more than one consumption period and (b) when the timing of
purchase and the timing of consumption were different (Simonson andWiner 1992).
Impulse buying:​​Impulse buying occurs when a consumer experiences a sudden, often ​powerful
and persistent urge ​to buy something immediately. It is more likely to involve grabbing a
product than choosing one.
Habitual behaviour :​​Habit generally forms when the consumers are ​satisfied ​with the outcomes
of the earlier purchases. Habitual buying is characterised by absence of information search and
evaluation of alternate brands (Assael, 1987).
Extended problem solving :​​This occurs when the ​purchase is of importance ​to the buyer.
Assael (1987) found this process to occur during the purchase of ​complex, high priced products
where ​brands a perceived to be different ​and are associated with ​high degree of uncertainty.
Under the complex decision making, the buyer evaluates the brands using choice criteria.
Various types of choice criteria are used to evaluate the different brands. O'Shaughnessy (1988)
classified the various choice criteria under technical performance criteria or generated functions.
Indian consumer buying behaviour analysis
Before nineties, most of Indians were in Picking or impulsive buying behavior regarding the
snack industry, as there was not many choices around. I recall that during my childhood potato
chips was considered as Fasting Food( people used to eat during the day long fast, as per Hindu
tradition). After economic liberalization, multinational companies such as PepsiCo and Coke
have entered into Indian FMCG market and changed the equation. The major task to market
items as potato chips is to bring Consumer from Picking to Variety seeking and then to Problem
solving behavior, to change fasting Food to Fast Food
The indian consumers are noted for the high degree of value orientation. Such orientation to
value has labelled Indians as one of the most discerning consumers in the world. Even, Luxury
brands have to design a unique pricing strategy in order to get a foothold in the Indian Market.
Indian consumers have a high degree of family orientation. This orientation in fact, extends to
the extended family and friends as well. Brands with identities that support family values tend to
be popular and accepted easily in the Indian market. Indian consumers are also associated with

6. values of nurturing, care and affection. These values are far more dominant than values of
ambition and achievement. Product which communicates feelings and emotions gel with the
Indian consumers. Apart from psychology and economics, the role of history and tradition in
shaping the Indian consumer behaviour is quite unique. Perhaps, only in India, one sees
traditional products alongside modern products. For example, hair oils and tooth powder existing
with shampoos and toothpastes.
Product Life Cycle Plan
After carrying out the research and survey it will take around 4-5 months to launch the
product.Initial cost of launching the product will be high as much investment had to be done on
research and development,after that growth phase will be there which will result in maturity
phase and after that due to the tough market competition it willenter the decline phase. Currently,
major competitors have entered the maturity stage in potato chips industry.
Introduction Stage​​:In the introduction stage the market for supreme Swaadisht will be low as it
is newly introduced in market. It will take a little time initially for the product to get much
attention from customers. Strategy used in this stage would be Rapid Penetration where pricing
will be moderate and promotional measures will be very high, this is done through
advertisements and promotional events and personal selling. The profits are as good as none as
product will just maintain the BEP.
Growth Stage:​​Here the market starts growing. Mass production will be done to enjoy the
economies of scale then with reduced direct cost, company will offer discounts to the
intermediaries like retailers for pushing them to pull customer to enjoy the more profits. Because
of combination of personal selling and mass advertisement the customers started noticing the
product and slowly adopting it as it reduced wastage in hands of maid as well household ladies.
Maturity Stage:​​The sales were rapidly increasing and the competition to stand is getting
tougher.The profits were high as it very much acceptable in the market also mass production
done in various new plants. The competitors had come up with various offers. Also new
improved packaging will be adopted to renovate the product. The market share
will be is high as well as sales will be high. Profits are also high. Promotions will be kept same.
Decline Stage:​​In this stage it will face a stiff competition from other innovative products.

7. Recent Trends
The Indian snacks market is worth around US$ 3 billion .The “unorganized snacks market” is
worth US$ 1.56 billion .Potato chips and potato-based items form 85 percent of the Market.
Haldirams and ITC are some of the leading players. Frito Lay, with a market share of 45 percent
(US $550million) dominates the market.​PepsiCo is also a dominant player in the snack food
segment in India. PepsiCo's snack food company Frito-Lay is the leader in the branded potato
chip market. It manufactures Lay's Potato Chips; Cheetos extruded snacks, Uncle Chips;
traditional namkeen snacks under the Kurkure and Lehar brands; and Quaker Oats
According to the ministry of food processing, the snack food industry is worth Rs. 100 billion in
value and over 4,00,000 tonnes in terms of volume. Though very large and diverse, the snacks
industry is dominated by the unorganized sector. According to an Apeda survey almost 1,000
snack items and 300 types of savories are sold across India. The branded snacks are sold at least
25% higher than the unbranded products. Savory snacks have been a part of Indian food habit,
since almost ages. Though there is no particular time for snacks, normally they are consumed at
teatime. The variety is almost mind-boggling with specialties from all regions, which have
gained national acceptance industry. he been growing around 10% for the last three years, while
the branded segment is growing around 25% per annum to stand at Rs 5,000-Rs 5,500 crore, due
to various reasons like Multiplex culture, snacking at home while watching TV, pubs and bars
(where they are served free). AC Nielsen's retail audit shows that the large sales volumes are due
to a marked preference for ethnic foods, regional bias towards indigenous snacks and good
value-for-money perception. Of course the branded segment is much smaller at Rs 2,200 crore,
which is what makes it so attractive to food Companies that are looking at bigger shares and in
the branded snacks market, to get down to basics, Frito Lay commands a share of 45%, followed
by Haldirams at 27% and ITC at 16%. The Lay's, Haldiram, ITC and ​​rest is divided between a
handful of new entrants, wannabes and many regional players Of the wide range of snacks
available, potato chips constitute a sizeable segment of the Indian snack food industry, according
to India Info line. The potato chip market is generally an unorganized industry. Nearly all potato
chip snack products are manufactured and sold locally. There is also no uniform standard for
packaging, as there is in Europe, the United States and other more developed regions. Many
snack foods are sold loose or packaged in poly-pouches, which may only be folded, or in some
cases,stapled closed. As the Indian economy continues to grow, and production standards
improve, many snack food companies are making significant investments into plant equipment
and packaging machinery.
Competitor Analysis
The Indian snack industry consists of both organized and unorganized sector with total market
size of Rs. 45000-5000 crore. The industry is growing at more than 15-20$ annually. The
branded segment accounts for Rs. 2000 crore of the pie. Some of the major players in the Indian
Namkeen market consist of Haldiram Foods, Frito-lay, Bingo, Parle. The top namkeen brands in
India are generally products offered by Haldirams and Frito Lays. Synonymous with the salted
snacks industry in India is Haldiram food. Haldirams is known for its large variety of bands that
have been ruling the Indian snacks industry for over decades now. Consumers in India in a way
have become accustomed to the products of this particular brand.
The Indian snack market offers around 1,000 snack items. The market leaders of the namkeen
brands in India are Pepsico's Frito lay that has a market share of 45%. Its is being followed by
Haldirams that has a market share of 27% and then follows ITC’s Bingo has market share of
17%.

8. Competitors and Substitutes
Frito Lay ITC Parle Snacks Other Players
Lays
Kurkure
Lehar Namkeen
Cheetos
Uncle Chips
Aliva
Baked Chips
Bingo
- Tedhe Medhe
- Mad Angles
- Yummies
- No Rulz
Must Bites
Cheeslings
Haldiram
Balaji Wafers
Yellow Diamond
Fox Nuts
Popcorn
Nachos (Doritos)
Pringles
Hully Gully
Fun Stix
Too Yumm
Market Structure & Market Share
Value chain analysis
The value chain is a systematic approach to examining the development of competitive
advantage . It was created by M.E porter in his book, competitive advantage (1980) the chain
consists of a series of activities that create and build value . They culminate in total value
delivered by an organisation . The ‘margin’ depicted in the diagram is the same as added value.
The organisation is split into ‘primary activities’ and‘ support activities’.
Primary activities
Inbound logistics
Here goods are received from a company’s
suppliers . They are stored until they are
needed on the production/assembly line.
Goods are moved around the organisation.
Major competitors receives its raw
materials from potato vendors from the
plantation area. Major competitors have
their own vehicles for carrying the goods
which reduces its cost transportation .

9. Operations
This is where goods are manufactured or assembled . many chips manufacturing companies
have a big factory unit at gurgaon . Since the factory is located in national capital region which
itself is a big market for snack lovers .
Outbound logistics
The goods are now finished and they need to be sent along the supply chain to wholesalers,
retailers or the final consumers .
Marketing and sales
Lays, Kurkure, and Bingo’s have promoted their products through many promotional events,
they have tie ups with many retailers, opened many outlets and mass media campaigns through
actors, heavy advertisements done during the cricket world cup and IPL. they also went to spread
their product to people who were below 25 years . Also, major amount is spent for advertising
chips through web.
Procurement
This function is responsible for all purchasing of goods, services and materials . The aim is to
secure the lowest possible price for purchase of the highest possible quality . They will be
responsible for outsourcing (components or operations that would normally be done in house by
other organisations ) and epurchasing (using IT and web based technologies to achieve
procurement aims) bingo uses poly bags which contain the chips.
Technology development
Technology is an important source of competitive advantage . Companies need to innovate to
reduce costs and to protect and sustain competitive advantage . This could include production
technology, internet marketing activities, lean manufacturing, customer relationship management
(CRM) and many other technological developments
Consumer Preferences
The India - specific snacks from Pepsico stables, popularity dubbed as ‘Chai Time Snacks’
(Vernacular for snacks with tea-breaks) has taken the Indian consumers by storm since inception.
However, the success of the product can be attributed to the diverse primary and secondary
consumer research by the company across various regions in India.
The research yielded the following:
- The Indian palate preferred strong, sharper flavours as compared to their western
counterparts.
- There should be none or minimal non-vegetarian or perceived non-veg component.
- It should have a ‘yellow’ tinge as the yellow colouration comes from ‘haldi’ or turmeric,
which is one of the primary seasonings used in Indian food.
- It should be ‘crunchy’ for a long time after being taken out of the vacuum sealed packets.
- It should be a ‘lookalike’ to commonly prepared snacks in Indian Households.
- It should not have some of the negative characteristics of Indian snacks like being
drenched in oil, fast rate of rancidity and lower shelf life.

10. Product differentiation:​​The product category that all chips company had come with adhered to
the information obtained by their extensive primary research.
Cultural factors: ​​The nomenclature of the products had fully vernacular undertone. “Kurkure”
meaning crunchy, “namkeen” meaning salty snacks in hindi, “lehar” meaning wave pattern in
hindi etc. for the semi-urban, non- urban population, the name itself had a fresh and crunchy
connotation. The colour of the snacks used were also red , yellow with seasoning having a visual
reminiscence of tangy red-chilli powder.
Social factors: these products were targeted primarily to the young social groups. It was
observed that during social meets, the age 15-25 group category used a combination of snacks
and aerated soft drinks. Kurkure became one of their prominent choices. However the older age
segment (25-45) years also became to consume snacks like kurkure , lehar etc. also while
spending quality time with family while watching the quintessential cricket match or a movie
these snacks were the snacks of choice. The youngest target group (5-15) years have become
surprisingly big chunk of the consumers . they have a pestering factor to get their parents to buy
them the snacks. Especially after these brands adhered to prevailing health standards (40% less
saturated fat, zero trans fats and no added MSG ), the parents had less qualms about buying these
snacks.
Personal factors: ​​the brand personality of the products like that of kurkure denotes society,
family and fun . there is no exclusivity or sophistication involved. However, the commercial
denotes an aura of ruggedness. It reaches out to a plethora of classes through its consumer
engagement programs. Kurkure has emphasised on the family aspect by extensively branding the
concept of ‘spend time with your family’ . it also has a high predilection towards the indian
values and lifestyles as portrayed in its commercials. Thus, as per the positive consumer
responses, it has positioned itself as “fun family treat” for informal social gatherings.
Segmentation, Targeting and Positioning
The snack food industry in India is highly fragmented, with the market dominated by made at
home snacks or savories sold by local vendors. Banana wafers, chaklis, samosas , namkeens are
few examples of large list of indian snacks . The Indianised snacks made by Pepsi Co such as
Kurkure , Lehar namkeens and Aliva have been very popular in the indian market since the time
they were launched . Pepsico launched these products in order to enter this market . These
innovative products were specially designed keeping in mind the unique taste and lifestyle
preferences of the Indian people . In order to understand the market for these products, we need
to segment the indian market on the basis of different variables as follows.
Geographic: Indian consumer food habits are starkly different from their counterparts in the
European and American markets. Within India itself, people from each region have their own
unique taste preferences. The people in the southern part of India have a different taste as
compared to people in the northern or the western part of India. The market could be broadly
divided into four regions - north, south, east and west. It could also be divided into rural and
urban regions of India.
Demographic: ​​Here we can divide the market using the following variables.
- Age: Children, young people, middle and old aged people
- Income level: high, medium or low income level
- Family Structure: nuclear or joint families

11. Psychographic: ​​Different people have different lifestyles and personalities which have an
impact on their taste preferences. Lifestyles include culture-oriented, sports-oriented or
outdoor-oriented. Personalities could vary from gregarious to ambitious to authoritarian.
Behavioural: ​​Market can be primarily divided on the basis of occasions like regular or special
(Diwali, Ganesh Chaturthi, Holi and many more).
Targeting
Different brands of Pepsico such as kurkure, lehar namkeen and aliva have been targeted at
different market based on the segmentation described above. Now we delve deeper into each
brand’s target market.
Kurkure: it primarily targets people of india and pakistan all over the world and caters to people
of all age groups, gender and income levels. As far as background is concerned, it is targeted at
both urban and rural customers. Within india the different flavours of kurkure such as punjabi
kadhai masala, chilli chatka, south special, east parar tok jhal, mumbai chatpata, hyderabadi
hungama, green chutney rajasthani snack etc have been specially designed to target different
regions such as mumbai(west), kolkata (east), rajasthan, punjab(north) and hyderabad (south).
When it was launched, it targeted mainly young people and children but since then pepsico has
also included families of any size in its target group. On the psychographic basis, it targets both
traditional as well as contemporary cultured people . it is also targeted at people who are
gregarious and fun loving as matched by the personality of its brand ambassador juhi chawla
who is known to be gregarious person. Although it is a regular use food item, during the festive
season it also targets people who are looking to buy gifts for families and friends.
Lehar namkeen: ​​it is targeted towards a more traditional market for namkeens which middle
aged and older people identify with. It comes in different flavors very much similar to traditional
namkeens in india. It is aimed at people who do not mind paying a premium to buy namkeens
which are made from good quality ingredients. It targets primarily people in the urban india with
rural india still preferring to to with local namkeens. However with similar packs and different
price points, it has a huge potential to increase its share in the rural market .
Aliva: ​​aliva mainly targets young people who have a very active lifestyle . it is aimed mainly at
the contemporary urban working class people who have busy schedules and tend to eat unhealthy
snacks without getting enough time to exercise . by introducing healthier snacking options, aliva
is targeting those people who are short on time due to their busy schedules and like to eat healthy
yet tasty snacks to stay fit.
Positioning
The various brands of pepsico in the indianised snack category have been positioned differently
to cater to different target groups . we now delve deeper into various brands .
Kurkure​​: it has positioned itself on the basis of its unique tastes, flavours, ingredients and styles.
It was originally positioned as a lighthearted fun, crunchy snack with a spicy flavour and an
unusual shape different from the usual potato chips. Since then it has changed its positioning to
more of a tea time snack competing with traditional bujias , biscuits , chaklis , samosa and
others. It serves perfect combination with tea, coffee etc.

12. Lehar namkeen : ​​it has positioned as a great tasting, good quality and fresh snack that would go
well anytime anywhere with anything. It used tagline ‘taste zyada kyunki oil taaza’ which
created an image of a snack made from fresh, good quality ingredients. It also positions itself as
a snack which is difficult to resist because of its taste . with its new tagline ‘khushiyon ka
khazana’, it positions itself as a source of joy and happiness for people eating it.
Aliva: ​​aliva is the latest addition to the indian snack category from pepsi. It is primarily
positioned as a health snack for people who prefer to eat healthy, yet tasty and spicy snacks. It is
a significant step in the company’s journey of portfolio transformation towards providing
healthier and tasty snacking options in line with the local consumer needs.
Future Growth Potential of Competitors
Export potential of the category needs to be harnessed in full measure. At present, ethnic Indian
snacks cater only to limited mainstream consumers, that too very sporadically.Haldiram leads in
this area too being one of the largest exporters of namkeen. The report suggests developing
patents and trade name accreditation for traditional snack foods,identifying marketing partners
and organizing integrating agencies. And market leader Frito Lay’s is already a global brand.
Thus, Indian competitors can grow by expanding into Exports.
Market Leader - Frito lay’s
With its irresistible taste, international and Indian flavors and youth-centric imagery, Lay‘s has
established itself as a youth brand and continues to grow in the hearts and minds of its
consumers.
Vision
At Frito-Lay, we‘re all about good fun —from making tasty snacks to get your party started
to taking care of our 50,000employees who know how to find the fun in everyday challenges. As
a proud member of the PepsiCo family, Performance with Purpose is what we work to achieve
every day. And to us, that means creating the high-quality snacks our fans deserve, while caring
for our people, communities and the environment we share.

13. Marketing Mix
Product:
Lays, from Pepsico, is a leading snack and chips brand, having its presence all across the world.
Lays products are specifically made with respective country’s demand. In India, the flavors are
given to the potato chips according to regional popularity of flavors resulting in increase in
customer base. As Indian masala are most famous worldwide hence Lays have also made some
international flavor chips. The potato chips are trans fat free. Hence they are marketed as healthy
snacks. European countries’ consumption is totally dependent on packed food hence this snack
food has been in high demand. In India also, crazy of fast food, packed food is rising
continuously. Lays come with air filled to maintain crispiness of the chips with long life. In
Lays, the packaging and designing of the product is also concern part.
Price:
The price is the point where products are distinguished, as pack snack food can/can not be the
replacement of the current snacks food in India. Indian population is concern about taste but
moreover price come. Considering competition from Kurkure, bingo, Haldirams chips and many
more, Lays have maintained their prices as low as to compete for the market. Different sizes with
prices are available. Lays don’t change its prices with change in raw material cost; they change
quantity as package contains 70% air. The manufacturing locations, supply chain management,
distribution and variable cost is maintained for competitive pricing. Availability of product, bulk
ordering and marketing these all things contribute to the pricing strategy of the Lays.
Place:
Lays have very strong supply chain network plus distributor and retailer network. Hence one can
find Lays chips in any corner of the country. Supplier, distributor and retailer are the backbone of
Lays sales. There is no specific targeted area for Lays as this food is demanded and favorite of
everyone. The production of Lays requires high quality of potato. Hence production houses of
the are at different location in India. Worldwide this snack food is highly demanded with high
competition. Being PepsiCo product Lays have advantage of the its own supply chain and
advertisement strategy.

14. Promotion:
Being PepsiCo product, Lays have extensive marketing strategy. Celebrity endorsement is one of
the important and impacting marketing channels. Lays have different brand ambassador with
time and marketing type. Being all segment snacks food product Lays have reached to customers
in different way. Advertisement on popular TV channels, radio, magazines, newspapers, other
print media channels is among important promotional plans of Lays. Lays also have high digital
marketing footprint. Social media marketing due to more brand visibility on Facebook, twitter
and YouTube with descriptive blogs of product on magazines is also one of the strategies.
Sponsoring different events like IPS and cricket has also made Lays more popular food among
sports enthusiastic.
Brand Identity
• Brand Value $12.1 B
• #42 In Forbes World’s Most Valuable Brands
• Brand Logo: 3D Glowing Sun
• Brand Tonality: Funny, youth centric imagery
•Brand Philosophy/Slogan: Real Flavours of Life
•Brand Advantage: 100% Vegetarian(India)
Brand Architecture

15. Lays Brand Architecture
Branding Strategy
● Mainly focused on the product. Taste, flavors , aroma & crispiness are highlighted
● The whole experience of eating Lay‘s is also communicated as event of joy and
happiness.
● The proposition like ‘Be a Little Dillogical‘ or ‘Pal Banaye Magical‘ is emphasized upon
● Lay‘s has been associated as a happy or a fun brand, which stands for simple joys of
everyday and for togetherness.
● Constant customer engagement with contests and flavor co-creation too

16. Frito Lay’s IMC
● Focus on extensive use of television commercials.
● Brand targets mainly the youth; ads feature in sporting events as well as music channels
● Celebrities are featured in almost all of them.
● Social media promotions are pursued now with the Facebook page having 3.8 M likes.
Campaign Analysis
Pal Banaye Magical Campaign - 2014
Dilemma: The brand never really found a sustainable positioning platform ever since
it ditched its " No One Can Eat Just One.
The brand decided to experiment yet again with the tagline, bringing int he new one - "Pal
Banaye Magical " meaning " Making Moments Magical”; " Pal Banaye Magical " sounds good
and the creatives can work on this theme with a variety of stories. But it never comes anyway
near to the brand's original tagline.And these frequent changes in the positioning doesn't augur
well for the brand's overall strength.
Analysis
This famous advertisement of lays endorsed by Ranbir kapoor appealed to youth. It was focused
towards humourous, social and emotional appeal.The advertisement trying position itself as
snack for friends during big gathering while creating memories.
Brand Equity:
During this ad campaign brand associations with friendship, cool, gathering and party were
enhanced and Negative associations with guilt were reduced.

17. Love to love it campaign - 2016
The advertisement focuses on appeals such as humour, saricity activeness. The ad focuses on
nani doing irrational activities just to get one lay’s chips. The ad ends with saying banade nani
ko bhi ninja with lays tagline of love to love it.
Brand Equity:
During this ad campaign brand associations with love for lays was highlighted to show its
superior taste and crunchiness where people could do irrational things to get lays.
Real flavours of life - 2018
The advertisement shows 2 women friends on beach . one engrossed in her tablet using social
media. The other motivates her to play on beach by saying “ bhaav mat kha, khana hai to lays
kha! Aur life ke real maze utha.”
Tha advertisement shows appeals such as humour, social, outdoor fun .​Brand Equity:
During this ad campaign brand associations with friendship, outdoor locations were positively
impacted also focus on social media and tablets to show resonance with the youth.
Best Buddies TVC – 2014
As part of strengthening the brand philosophy ‘Pal banaye magical‘, the potato chip maker plans
to make ‘Lay‘s Best Buddies‘ as the coolest group on campus with the most happening and
magical fun moments. Conceptualized by JWT, the brand has launched a TVC featuring Lay‘s
Best Buddies, following teaser updates and an exclusive trailer video on its social networks
since January. Interestingly, the ad is being promoted as episode 1 of Lay‘s Best Buddies Season
2014, suggesting that there will be additional episodes to this college story.

18. An exclusive trailer video of the ad (projected as an episode) was then shared on the wall. Titled
‘Lay‘s Best Buddies – First Look‘, the one-minute trailer introduces the group through bits and
pieces from the TVC, while bracing up fans for the season of friendship. When you think of
snack foods and beverages, you can‘t help imagine a college canteen or the crowds of
students thronging away at food stalls. So the concept of a cool college gang, the ‘Lay‘s
Best Buddies‘ in this ad isn‘t particularly exciting. But, the concept of storytelling surely is! The
well-targeted storytelling has been well reflected on the brand‘s social platforms too​.
Brand Associations
Mental Maps

19. Customer Based Brand Equity Model - Lay’s
Challenges Faced by Lay’s
The frito-lays brand has strong associations of fun, family friends and sport fans but the rising
awareness about the fats and calorie gain is posing a threat for whole of the industry. All the
consumers are looking for more healthier alternatives. Also, new flavors introduced by brand
Max Chips have failed to create high satisfaction among consumers. Lastly, engagement with the
brand is quite low which results in low brand equity. Thus, it is very important for lay’s to
increase engagement with the brand.
The challenges could be overcome by introducing new flavors after conducting proper market
research or lay’s can introduce healthy alternatives under the same brand to fend healthy
alternatives and remain the number one brand of choice. For brand engagement, lay’s can start a
campaign highlighting the problems faced by students in a funny manner and ask fans to tag their
friends. This would create a ripple effect and help in increasing the engagement as well as likes
on social media channels. Also, lay’s can create a recipes for new dishes which can be enhanced
by using lays as an ingredient.
Insights from Survey
● Lay’s has highest recall rate of 96.8%
● Lay’s has the highest consumption rate (30% surveyee consuming it often regularly)
● Highest satisfaction index among taste and ease of accessibility and lowest among price.
● Highest recommendation rate of 38% among the bunch
● 75% association of the brand with fun-party and more than 60%for cricket, outdoor,
family.
● Popular flavour (masala 75%) followed by cheese and onion(58%)
● Highest associated color blue (74%)

20. Developing Our Own Brand
Strengths
- Focussed Product Line
- Product innovation
- Concentrating only on Urban
Population.
- Competitive Pricing
Opportunities
- No market leader in TG
- Customer preferences changing
- Low customer engagement
- Majority population in 20-25 age
bracket
- Disposable income rising
- Quick Snacks CAGR increasing
- Social Media ad’s and mobile app ad’
platform currently unused by
competitors.
Weakness
- No Recall/Recognition
- Weak distribution channel
- Large no. of competitors
Threats
- Market leader could introduce similar
products.
- Health maybe just a fad
- Customer Taste preferences changes
continuously
Segmentation
Based on survey responses, we will use following factors:
Demographic​​: Education Level, Income level, family size, occupation, and age.
Psychographic: ​​Lifestyle factors like how often they go for movies, or pursue outdoor activities
like movies, adventure sports, restaurant visits, out of station visits, and long drive trips.
Behavioral: ​​How often do these people party or celebrate occasions with friends and families,
gifting behavior on festivals.

21. Targeting
We will be targeting customers in age bracket 20-35 year olds who are conscious about their
health and can pay for premium product.
- Targeting using Celebrity endorsements and print media ads.
- Tie-ups with Movie Theater chains to increase availability in.
- Social media channels will be created on all major platforms with major focus on
Instagram as our target audience is more engaged with instagram.
- Giving high margins to retails chains in initial stages to get distribution support and more
prominent shelf space in stores.
- Availability through supermarket/hypermarket stores and online sales of combo packs on
major e-commerce platforms.
- Tie-up with celebrity chefs and indie/potential social media stars to create special recipes
with our products.
- Promotion using social media channels and mobile app ad’s to highlight the guilt free
snack and increase engagement as majority of competition is not focussing on them.
Positioning

22. Brand Associations
Brand Elements:
Name Crispies
Logo
Slogan Healthy,Tasty, Everyday Snacks
URL www.Crispies.com
Shape Square (Wherever Possible)
Color Red & White
Packaging Boxed or Canned Packaging
Jingle Bell Ring
POP/POD’S
Point of parity Point of disparity
Good texture/consistency -satisfying crunch,
lightweight, does not break when dipped.
Tasty- keeps consumer wanting more ,
consumers will feel confident when serving
them at parties.
Variety of flavors.
Fun & Warm
To be enjoyed with Friends, Family
Packaging
Healthy
Premium/Superior
Out of station/Movies
Colors: Red & White
Shape: Square
Packaging
Movies, & Out of station trips

23. Product
We will we starting with baked potato chips product with 5 most liked flavors which are Masala,
Cheese & Onion, Classic Salted, Pudina and Sweet Chilli as observed in our survey. Our product
will come in square shape as to create differentiation. The Crispies are going to be a premium
product with same crunchiness and superior taste levels as perceived by customers in other
brands. The product will be in salty & savouries category to be used as a quick snack food which
could be used to satisfy hunger in a healthy manner. Crispies will come in a boxed or canned
premium packing. The Crispies packaging will be made in such a way that it could be later
reused by consumers for other purposes. The product will be come in special packaging for
movie theater retail chains. Crispies will be later expanded to different product lines like foxnuts,
rice flour based munchies, chakhna line, lentil/veggie based crunchy's and many more.

24. Pricing & Distribution Channel
Type of Pack(in gms) Price in Rs. Distribution Channel
Small Pack (50 gm) Rs. 30 Retail Shops, Petrol Pumps Outlets, Canteen
Medium Pack (75 gm) Rs. 45 Above Channels + Supermarket Stores
Family Pack (100 gm) Rs. 60 Above Channels + Online Ecommerce
Combo Pack of 2
- (Total 100 gm)
- (Total 150 gm)
- (Total 200 gm)
Rs. 50
Rs. 80
Rs. 100
All of above
Combo Pack of 3
- (Total 150 gm)
- (Total 225 gm)
- (Total 300 gm)
Rs. 80
Rs. 110
Rs. 100
All of above
Gifting Pack
Pack of 3 (250 gm)
Pack of 5 (500 gm)
Pack of 10 (750gm)
Rs. 250
Rs. 500
Rs. 750
Retail Shops, Supermarket store, Online
Ecommerce and Wholesale shops
Special Movie Pack (100gm) Rs. 150 Movie Theatres ( With low profit margin)
Will be used to create brand salience
Push & Pull Channel Strategies
According to survey, Customers in this brand are less likely to try any new brand thus we will
use a mix of push and pull strategies to gather market share.
1) Discounting: To push our brand we will use discounting technique in which extra
quantity will be provided at the same cost to entice customers to try new flavours.
2) Ecommerce/Netflix/Amazon Prime Voucher: ​​According to our survey, customers in
target segment will be motivated to purchase our product if ecommerce/Netflix/Amazon
voucher is added to it. So, we will start a lucky draw campaign in which customer will
have to send in code (present inside the product) to us and on the basis of lucky draw,
1000 lucky winners will win a Rs. 250 Amazon voucher or 3 month free subscription for
Netflix or Amazon Prime..
3) Higher Distributor Margins: ​​To gain the distributor support, we will be providing
higher margins to distributors and retail chains to get premium shelf space and motivate
retailers to sell our products as compared to competitors.
4) Taste before you buy campaigns: We will provide our retailers with sample packs
which they will present to potential customers after providing their basic details, this will
help us in creating a barrier of tasting new product and risks associated with it. Also, at
the same time it will help in gathering customer data which could lead to potential
insights.
5) Event Promotions: ​​We will host small events in metro cities in which small games and
fun activities will be organised with agenda of promoting our Crispies brand. Example of
this would be to create a new recipe with our Crispies.

25. 6) Chef’s Special: ​​We will tie-up with chef’s to create new recipes with Crispies, or use
Crispies as a complement to other dishes.
7) Social Media Strategy: ​​We will utilise social media to create a community of customers
who will be prompted to share their fun stories, and learn about our upcoming products.
Also, we will be sharing funny jokes on problems faced by our target segment to create a
sense of belongingness and understanding.
Brand Architecture & Brand Extensions
Brand Loyalty
Chips being a low involvement product will result in difficulties in engaging the audience and
create resonance with brand. Thus, we will use social media to engage the audience with brand
via following approaches:
1) Share your funny story - Customers would be featured on our page if they share their funny
crispy memories with the other community members.
2) Linking Crispies with Latest trends - We will create poster in which we try to fit crispies with
latest trends wherever possible just like amul girl.
3) Fitness related posts doable at home - Since this is going to be healthy brand, we will try to
leverage the fitness conscious customers by showing them related content.

26. 4) Share Crispies Recipe - We will ask customers to share their newly invented recipes with
Crispies. Wherein, each month most liked recipe will be a gift hamper.
5) In-house Chef’s Recipe - We will hire an inhouse chef to create product video and use cases
for the potential customers on social media platform.
Advertising Strategy
Media Plan
Target:
● Urban Metro
● Working Couples
Objectives:
● Use broadcast media to provide coverage of 80 percent of the target market over a
six-month period.
● Reach 60 percent of the target audience at least three times over the same six-month
period.
● Create a positive brand salience and brand image through product usage, mood and
creativity.
Media Mix

27. Advertising Message

28. References
1. http://www.pepsicoindia.co.in/brands/lays.html
2. https://www.nielsen.com/content/dam/nielsenglobal/jp/docs/report/2014/nielsen%20featu
red%20insights_%20biting%20into%20the%20indian%20snacking%20market.pdf
3. https://www.forbes.com/companies/frito-lay/#2c62f68730bf
4. https://www.youtube.com/user/yourlaysflavour/videos
5. https://www.forbes.com/sites/krnkashyap/2017/08/25/chipping-away-pepsi-is-losing-its-h
old-on-indias-2b-salty-snack-market-to-regional-brands/#70f6cf62673b
6. https://smallbusiness.chron.com/media-mix-78802.html
7. https://smallb.sidbi.in/sites/default/files/knowledge_base/potato_chips.pdf