The Del Monte difference

.
Its an ambitious target. FieldFresh Foods, the 50-50 joint venture between Bharti Ventures of the Mittal family and
Del Monte Pacific of the Philippines, wants to find a place among the top ten food and beverages companies in India
by 2016.
The categories it has chosen to operate in sauces, juices, Italian cuisine and packaged fruit add up to a market
of Rs 4,000 crore, which is growing at 20 per cent per annum. The market may be large but there are well-entrenched
players in the business like Nestle, Hindustan Unilever, ITC, Heinz, Parle Agro and Dabur. It wont be easy for
FieldFresh to snatch market share from them. Still, it is dead serious. It plans to pump in Rs 300 crore in a food
processing plant at Hosur in Tamil Nadu and in research on fruit and vegetables. In less than two years, it has
reached its products to 20,000 retail outlets in 25 cities.
FieldFresh is banking on the expertise of Del Monte, especially in supply chain. Del Monte is the only company that
supplies both fresh and processed fruit. It has got pineapples from the Philippines, peaches from South Africa, olives
from Spain, and prunes from California. This gives us a lot of options, says FieldFresh CEO Sanjay Nandrajog.
Before his current assignment, Nandrajog held several leadership positions in the Airtel mobility business. FieldFresh
is using the Del Monte brand. Does it have any recall with Indian consumers? One-third of all customers have come
back to the stores and have asked for a Del Monte product, says Nandrajog. Still, the company needs to work on the
brand. Del Monte is definitely going to see a tough time in establishing itself as one of the top food companies in
India amidst fierce competition from existing players, says KPMG Advisory Services Manager Anand Ramanathan.
Fresh and different
Nandrajog and his team know that the market is cluttered, and they need a good differentiator if they want to stand
out. With this in mind, FieldFresh has introduced two sauces in the market called Zingo and Twango. Ketchup and
sauces are one of the toughest categories to crack as there are big players, and we have our own Indian chutneys
too. Our effort was in terms of understanding the need of the housewife. Todays housewife wants to experiment in
the kitchen. She wants to serve the food with her signature and also have something that can be served with an idli
as well as a sandwich, says Nandrajog. For a first, Zingo and Twango contain capsicum and pineapple which give
out a unique taste and also contain fibre.
Will that be good enough? The market for sauces is around Rs 900 crore in the country. Nestles Maggi leads the
pack with a market share of 41 per cent, followed by Hindustan Unilevers Kissan (26 per cent). The rest of the
market is with Heinz, Cremica, Tops and others. Most of these brands have a host of flavours developed specially for
the Indian palate. Maggi sauces are preferred for their superior taste, trusted for their high quality and acknowledged
for their innovative offerings like Hot & Sweet, Tomato Chilli, Oriental Chilli Garlic and several others, says Nestle
India General Manager (foods) Shivani Hegde. Nestle has also come out with small packs, called Maggi Pichkoo,
which has extended the market to a whole new set of consumers.
The days to come will tell whether or not Zingo and Twango have dented the other brands in the market. But the
innovation was good enough for FieldFresh to launch its inaugural brand campaign. Scripted by Vandana Katoch of
Contract Advertising (Delhi) and filmed by Shoojit Sircar of Rising Sun Films, it showed a woman chasing boys
across streets after they share the two sauces with her inside a train.
Whats in the juice?
If flavour is the differentiator for Del Monte sauces, packaging will differentiate Del Monte juices. Instead of cartons,
FieldFresh is selling its juices in aluminium cans. The fruit juice market in the country, estimated at Rs 2,000 crore per
annum, has three distinct sub-categories: Fruit juice with pulp content of 80 per cent and more (Daburs Real,
PepsiCos Tropicana), nectar with 40 to 80 per cent pulp (Godrejs Xs) and fruit drink with pulp of 40 per cent and
below (Parle Agros Frooti, Godrejs Jumpin, Coca-Colas Maaza). With 20 to 30 per cent pulp, Del Monte sells in the
third category. We operate in the segment which is refreshing and tasty. However, for a consumer, a juice is just a
juice, and he can hardly differentiate. The youth keeps looking for options that are different in taste, and have a
refreshment need as well as a nutritional essence, says Nandrajog. He has in his portfolio five fruit drinks and hopes
to add a sixth soon.

Of course, FieldFresh hopes to score with its aluminium cans. We have brought these packs (aluminum cans) in an
Indianised version at quick-service restaurants and low-cost airlines. Also, we have a vending option that can be used
at offices and other high-traffic locations. It can dispense through the day, churning out 20 cups a minute, and it is
more affordable. It also makes Del Monte the first international branded player in the fruit drink dispenser segment in
India, says Nandrajog.
FieldFresh hopes to rev up the excitement at the youth hangouts this summer with its on-ground activity, the Del
Monte Legend Brigade. The activation that started during mid-June will travel to metros and mini-metros where the
winner will receive a custom-made bike worth Rs 200,000. Besides, an online biker game is on at its microsite,
www.worldfoody.com. Anyone in India can participate in the online game and experience the thrill of biking. Yogesh
Bellani, business head (Del Monte Foods Business), FieldFresh Foods, says: This initiative aims to popularise the
range of Del Monte fruit drinks in pineapple, four seasons, pineapple-orange and the newly-launched green apple
and orange flavours. But this is a game others too can play. We control over 52 per cent of the juice market in India.
We continue to look at newer variants to keep up the excitement in the market, says Daburs head of marketing for
foods, KK Chutani.
Also, fruit juice is a heavily-advertised category and most players are spending big bucks on promoting their brands.
If FieldFresh wants to do well, it too will have to put money behind Del Monte juices. PricewaterhouseCoopers
Executive Director Anand Dikshit reckons that most brands spend up to 18 per cent of their turnover on promotion.
The norm for the food business is 13 per cent to 15 per cent.
Pasta play
Del Monte has a whole family of Italian products after having studied the gap in the Indian market. Most of the
products olive oil, pasta and sauces are imported and sell Rs 500-600 crore in a year. Nandrajog believes that
the pasta market in India is emerging as the next-preferred healthy snack option. There is hardly any brand present
here that offers authentic Italian pasta. Del Monte sells authentic pasta, imported from Italy, in the retail market. We
will continue to launch pasta stock-keeping units of the same product type, but in different shapes and varied
measurements soon, he says. Del Monte also offers Spanish olives, whether green or black, pitted or stuffed or
sliced. Its extra virgin olive oil is a healthier alternative as a cooking medium, claims Nandrajog, and comes in PET
break-resistant bottles in 1 litre, 500 ml and 250 ml. Soon, we are going to launch pasta sauces in India adds he.
Pasta is not altogether new to the Indian market as sometime back Barilla Pasta, made from 100 per cent durum
wheat, came to India through a strategic marketing tie-up with RR Oomerbhoy. There are also a couple of other
imported brands from south-east Asia which are selling in India. Then ITCs Sunfeast portfolio was expanded in early
2005 to include snacking options, pasta being one, besides Aditya Birla Retails Feasters. Nestle (Maggi Pazzta) and
ITC (Sunfeast Pasta) have also launched instant pasta. Market estimates suggest that instant pasta is around 5 per
cent of the Rs 1,100-crore market for instant noodles. Some feel that the real growth opportunities are in instant pasta.
Culinary pasta is for the real pasta eater, for people who know how to cook pasta, for which there is not a big market
as such in India, says ITC Foods Chief Executive Officer Chitranjan Dar.
Apart from B2C, FieldFresh also does B2B sales. It sells fresh and canned fruit, penne pasta, snack dressing, mango
pulp, tomato paste, jalapeno, fruit cocktail and whole corn kernels to 2,200 hotels, restaurants, bakeries and so on in
the country. Nandrajog claims it is the only national player in the segment. There is a dedicated team of 70 men and
women at Del Monte Foods Business that services this sector. Does it have a unique selling proposition? Our
packaged fruits have an extended shelf-life, and are also available in easy-to-open cans to enhance consumer
convenience. For our customers, we also offer institutional packs, says Bellani. Over to the market place.
Question: FieldFresh Foods wants Del Monte to become one of the countrys top food and beverages brands. Can it
cut through the clutter? Justify your answer
(This has been compiled by Prof Rajiv Taneja)