In an exclusive interview with CNBC-TV18’s Ekta Batra and Reema Tendulkar, C Srishant executive director of CCL Products says that company has seen positive response to the soft lauch of new retail products in Hyderabad. “We have launched three products in the local market and all of them have received a good response,” he says.
Confirming the extensive launch of the products, he says, “We are talking to major retail chains all over India, and apart from them, we are looking at specific states — Andhra Pradesh, Tamil Nadu and Karnataka to place our products on the shelf. We are going to do it after about six months,” he adds.
He also says that the product will be pushed on to the markets without a spend on advertising and, “the product will be priced lower that competitors – Nestle and HUl,” and hence, he says, “our margins will be much higher than what we are getting for our exports.”
Below is a verbatim transcript of C Srishant’s interview with CNBC-TV18. Also watch the accompanying video.
Q: You did a soft launch of retail products in Hyderabad in January. What is the kind of response? When do you think you all will be geared to hit the market in a big way?
A: We received a really good response for products. We have launched three products and all of them have received a good response in the local market over here. As far as a hard launch is concerned, we are probably going to do it after about six months or so, once we get proper feedback from the market. We can access the volumes that we are looking at and accordingly take it forward.
Q: Can you give us an update on where exactly would you plan to launch the products? Which other markets are you possibly looking at launching, in terms of a soft launch in the next six to eight months?
A: Right now, we have already launched it in certain select supermarkets within Hyderabad. We are talking to a couple of major retail chains all over India. Apart from these retail chains, we are looking at specific states — Andhra Pradesh, Tamil Nadu and Karnataka where we are contacting certain distributors and placing our products on the shelf. We want to see the response from these different markets since each region the coffee consumption, the coffee taste profile is different, so our idea was to customize it according to that particular region.
Q: Who will be key competitors within this market and what sort of marketing expenditure could we see, in terms of an investment going forward, once you do launch on a larger-scale?
A: As of now, the only competitor in the pure coffee market segment is Nestle and in the chicory coffee mix segment it is HLL with the brand Bru. We are launching both pure coffee equivalent as well as the Chicory coffee product. Additionally, we will be the first ones in the Indian market to launch a third product which is a free fat coffee.
As far as the marketing expenditure is concerned, for the first one year we will just place the product of the shelf and sell to supermarkets without advertising. Subsequently, depending on the kind of response we will finalize on the strategy on how to spend for the advertising.
Q: Would your margins be a lot higher, when you do price it according to what your competitors are giving you?
A: Definitely, in fact we have strategized to place our products at a lower price than our competitors. Since, we don’t have any initial advertising expenditure; our margins will be much higher than what we are getting for our exports.
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