Beverage and snacks major PepsiCo is all set to make its first big move in India’s booming online retail space by selling its imported premium snacks and drinks brands exclusively through e-commerce platforms.
“We have a significant portfolio of high-end global brands which many Indian consumers are already familiar with. We are working out plans to make these brands available exclusively through e-commerce in India,” Vipul Prakash, VP for marketing at PepsiCo India, said. “It’s work in progress.”
The global brands PepsiCo plans to bring in through this channel could include Doritos and Tostitos tortilla chips, crackers and rolls, and premium fruit variants of its Tropicana juices. Each of these brands has annual global sales of close to $2 billion (about Rs 12,400 crore).
The strategy of selling imported brands exclusively through online platforms will be a first for the company in India.
According to Prakash, details of the e-commerce trategy, including which portals PepsiCo would tie up with, are expected to be finalised in the next couple of months.
PepsiCo’s regular beverages and snacks brands — Pepsi and Mountain Dew fizzy drinks, Lay’s and Kurkure chips — are already being sold through various grocery portals, including BigBasket.com, AaramShop.com and LocalBanya.com.
“Since imported brands will be available exclusively through e-commerce platforms, we see significant value in this strategy,” Prakash said. The US multinational’s move comes at a time when online shopping is growing exponentially in India, thanks mainly to the deep-discounting strategy of big players such as Flipkart, Amazon and Snapdeal. While electronic products, books and fashion are among the most popular products online, e-grocers too have reported significant uptick in sales in recent months, prompting big FMCG players to raise their online presence.
Late last year, PepsiCo’s arch rival Coca-Cola debuted its low-sugar Coke Zero cola in India exclusively on Amazon. Recently, Britannia Industries launched its super-premium chocolate chip cookie Good Day Chunkies exclusively on Amazon.
A report released by Internet giant Google and consulting firm Bain last fortnight estimated that the Internet will influence $35 billion of FMCG sales in India by 2020 when there will be more than 250 million online shoppers in India.
This rise in the online shopper base in India will contribute $5-billion worth of FMCG product sales, growing 50 times from the current level, and contributing 5% of total salesby 2020, it said.
“By studying the behaviour of the lead consumers from an FMCG standpoint, it is clear that FMCG companies in India need to start thinking of digital as a more strategic medium and chart out a digital growth path for their products,” Google India director Vikas Agnihotri said while releasing the report.
PepsiCo’s move to bring in highpriced, high-margin products is also part of its premiumisation drive.
