Shooping into instant noodles

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If you have come across the billboards of Shoop and are wondering what it is all about, Shoop is a new entrant – and Shan Foods’ foray – into the instant noodle category.

This category in Pakistan dates back two decades. Maggi (Nestlé) was the first brand to enter this market in 1992, followed by Knorr (Unilever) in 1993.

Nestle Pakista_MaggiAlthough entering this category puts Shan Foods up against two MNCs, Shan itself is no small player. The company has already embarked on its vision to become ‘a global foods brand’ and has a presence in over 65 countries. Shan has also expanded its product range from spices and recipe mixes to launching a dessert brand, Delve (in November 2011) and recently also ventured into the frozen foods industry by acquiring a plant and setting up business in Manchester (UK).

In Pakistan, interestingly, Maggi – in spite of being the pioneer in this category and the market leader in many countries internationally – takes second place to Knorr which is the market leader with a 50% market share. Maggi presently has a 45% market share, with the remaining small percentage taken up by imported brands such as Indomie (from Indonesia) and others.

Unilever_KnorrAccording to Raheel Pasha, Marketing Manager, Foods at Unilever Pakistan, the penetration of instant noodles (at approximately 60%) is still at a very nascent stage. The category accounts for a volume of “approximately 7,000 tonnes and is valued at over Rs 1.5 billion as per estimates from various sources.”

However, in Pakistan the category has witnessed an unprecedented growth of 30-35% year on year in the last three to four years, says Faisal Mubin Ganatra, COO, Shan Foods.

The reasons contributing to this growth range from increased urbanisation to changing lifestyles, people’s increasingly busy lifestyles makes the two-minute preparation time extremely convenient.

Shan ShoopThis growth in part is what prompted Shan to enter the category. Another reason is Shan’s expertise with seasoning, says Ganatra.

“No one knows spices and seasoning better than Shan Foods [an important element of instant noodles].”

Maggi, Knorr and Shoop all provide a variety of flavours popular among children, who are the core target market in Pakistan as instant noodles are regarded as a snack and the insight driving this category is that “snacking has become a very important occasion for kids, filling that gap between lunch and dinner,” says Pasha.

“For children this snack is fun, exciting and filling and parents consider it to be a healthier option over unhygenic nimkos, samosas, etc.”

Although children aren’t the only consumers, they make up the larger chunk. According to Pasha instant noodles are less popular with adults who look for snacking options on the go.

Maggi, Knorr and Shoop all fall within the price range of Rs 15-25. However, the category has seen some pricing wars. Earlier Maggi and Knorr were available at a similar price. However, while inflation led Knorr to increase the price of its 66g pack to Rs 20, Maggi decided to take a grammage cut in its product and re-launched with a 50g SKU at Rs 15 (later increased to Rs 18). Maggi’s pricing strategy gave it a huge boost in its market share which was previously dwindling. Despite the fact that consumer perception is that Knorr is priced higher (it is not), the brand is sticking to this pricing, although it has also recently launched a smaller ‘trial pack’ for Rs 15 aimed at penetrating the rural markets. In light of these pricing dynamics, Shoop has been launched in two SKUs: a 70g SKU at Rs 20 and a 50g SKU at Rs 15.

While currently the instant noodles category seems defined as an urban kids snack, Shoop is looking to stir things up a bit. Ganatra says the category has tremendous potential, as “Pakistan is an agricultural country, there is a lot of money in the rural areas as a result of which people’s lifestyles there are changing. This presents tremendous opportunities for new categories and brands to enter in.” Shoop however does not only plan on extending to the rural areas but also to other age groups.

The fact that Shoop is aiming to target other age groups is evident from its communications strategy which gets across the message that the brand is more than just for kids.

As for Knorr, its advertising remains focused on its core target group, (children between the ages of six to 12), which Pasha says has not yet reached its full potential. To this end Knorr has created animated characters and an animation series based on the Knorr Noodle Gang – which was most recently introduced in Urdu with the aim of reaching out to a wider audience.

Maggi’s advertising on the other hand has been centred on the family. It’s recent initiative has been to introduce its Maggi Master which it seems to be using to create a personality around its brand. The Maggi Master offers tips, advice and even recipes on its Facebook page.

Shan seems to be bringing new dynamics to the instant noodles category; it will be interesting to see how this plays out and if the tried and tested route taken by the existing players works best or if the category is ready to expand and explore other areas.

First published in the January-February 2013 issue.

If you have come across the billboards of Shoop and are wondering what it is all about, Shoop is a new entrant – and Shan Foods’ foray – into the instant noodle category.

This category in Pakistan dates back two decades. Maggi (Nestlé) was the first brand to enter this market in 1992, followed by Knorr (Unilever) in 1993.

Nestle Pakista_MaggiAlthough entering this category puts Shan Foods up against two MNCs, Shan itself is no small player. The company has already embarked on its vision to become ‘a global foods brand’ and has a presence in over 65 countries. Shan has also expanded its product range from spices and recipe mixes to launching a dessert brand, Delve (in November 2011) and recently also ventured into the frozen foods industry by acquiring a plant and setting up business in Manchester (UK).

In Pakistan, interestingly, Maggi – in spite of being the pioneer in this category and the market leader in many countries internationally – takes second place to Knorr which is the market leader with a 50% market share. Maggi presently has a 45% market share, with the remaining small percentage taken up by imported brands such as Indomie (from Indonesia) and others.

Unilever_KnorrAccording to Raheel Pasha, Marketing Manager, Foods at Unilever Pakistan, the penetration of instant noodles (at approximately 60%) is still at a very nascent stage. The category accounts for a volume of “approximately 7,000 tonnes and is valued at over Rs 1.5 billion as per estimates from various sources.”

However, in Pakistan the category has witnessed an unprecedented growth of 30-35% year on year in the last three to four years, says Faisal Mubin Ganatra, COO, Shan Foods.

The reasons contributing to this growth range from increased urbanisation to changing lifestyles, people’s increasingly busy lifestyles makes the two-minute preparation time extremely convenient.

Shan ShoopThis growth in part is what prompted Shan to enter the category. Another reason is Shan’s expertise with seasoning, says Ganatra.

“No one knows spices and seasoning better than Shan Foods [an important element of instant noodles].”

Maggi, Knorr and Shoop all provide a variety of flavours popular among children, who are the core target market in Pakistan as instant noodles are regarded as a snack and the insight driving this category is that “snacking has become a very important occasion for kids, filling that gap between lunch and dinner,” says Pasha.

“For children this snack is fun, exciting and filling and parents consider it to be a healthier option over unhygenic nimkos, samosas, etc.”

Although children aren’t the only consumers, they make up the larger chunk. According to Pasha instant noodles are less popular with adults who look for snacking options on the go.

Maggi, Knorr and Shoop all fall within the price range of Rs 15-25. However, the category has seen some pricing wars. Earlier Maggi and Knorr were available at a similar price. However, while inflation led Knorr to increase the price of its 66g pack to Rs 20, Maggi decided to take a grammage cut in its product and re-launched with a 50g SKU at Rs 15 (later increased to Rs 18). Maggi’s pricing strategy gave it a huge boost in its market share which was previously dwindling. Despite the fact that consumer perception is that Knorr is priced higher (it is not), the brand is sticking to this pricing, although it has also recently launched a smaller ‘trial pack’ for Rs 15 aimed at penetrating the rural markets. In light of these pricing dynamics, Shoop has been launched in two SKUs: a 70g SKU at Rs 20 and a 50g SKU at Rs 15.

While currently the instant noodles category seems defined as an urban kids snack, Shoop is looking to stir things up a bit. Ganatra says the category has tremendous potential, as “Pakistan is an agricultural country, there is a lot of money in the rural areas as a result of which people’s lifestyles there are changing. This presents tremendous opportunities for new categories and brands to enter in.” Shoop however does not only plan on extending to the rural areas but also to other age groups.

The fact that Shoop is aiming to target other age groups is evident from its communications strategy which gets across the message that the brand is more than just for kids.

As for Knorr, its advertising remains focused on its core target group, (children between the ages of six to 12), which Pasha says has not yet reached its full potential. To this end Knorr has created animated characters and an animation series based on the Knorr Noodle Gang – which was most recently introduced in Urdu with the aim of reaching out to a wider audience.

Maggi’s advertising on the other hand has been centred on the family. It’s recent initiative has been to introduce its Maggi Master which it seems to be using to create a personality around its brand. The Maggi Master offers tips, advice and even recipes on its Facebook page.

Shan seems to be bringing new dynamics to the instant noodles category; it will be interesting to see how this plays out and if the tried and tested route taken by the existing players works best or if the category is ready to expand and explore other areas.

First published in the January-February 2013 issue.

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COMMENTS

  1. Loved the description every thing. Tried shoop that’s even much better then the two leading brands. I was looking forward if someone could tell me the entire ingredients of shoop as both leading companies are playing with not only children’s lives but with us who are lazy and just cook 2 minute noodles.

    Would appreciate if I get a reply ASAP

    Regards
    Fatimah

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