Swaminathan Balasubramanian for StraighTalk
Home foodbrand Melam, one of the oldest Masala Brand in Kerala and has a strong domestic and export presence. Considered to be a household favorite since 1992, it was recently taken over by the diversified AVA group has added further strength to this brand and is sure to delight the consumers.
Over the years, Melam has carved a respectful name for itself owing to its quality products and authentic recipes. AVA group has intensified these efforts along with the setup of modern plant, strict QC norms, and checks.
Dr A V Anoop, Managing Director, AVA Group chats with TVNews4u on the acquisition, way ahead and expansion of the product portfolio.
1) What is the Strategy behind the acquisition of the Brand Melam.?
Food is one of the largest markets and convenience food market is growing rapidly given the fast pace of life. We wanted to be part of this growing market. Then the question was about make or buy. We believe if there is a good business to be acquired, it is always a better way to kick start your presence in the market than try and build your own from scratch. ‘Melam’, as a brand is well known in Kerala, so it was an opportunity to take a brand that is already respected and grow it further through the strength of our distribution and marketing muscle
2) Could you brief us on the Product Portfolio of Brand Melam and its Markets..?
Under brand Melam, we market Pure Spices (like Chilly Powder, Coriander Powder, etc), Everyday Masalas (like Chicken masala, Garam masala, etc), Traditional masalas (like Kerala – VarutharachaKozhi Curry masala or TN – EnnaiKathirikkaiKulambhumasala ), Pickles (Lime Pickle, Mango Pickle, and more) , Breakfast mixes (like PuttuPodi, Appam/IdiappamPodi, etc) and Ready to cook Traditional Desserts (like Easy Palada mix, Easy SemiyaPayasam mix, etc). The brand is widely available in stores in Kerala. We are slowly building distribution across Tamil Nadu and pockets of Karnataka. The brand is also available online on AVA Store (our own e-commerce site – www.avacare.in )
3) Is AVA Group planning on any aggressive marketing on Foods Business.?
To steadily build market shares and to keep up in pace with key competition, we try to have a sustained brand promotion. However since the market is cluttered with low margin products, fighting for entry into the store and for shelf space, in spite of heavy promotion, is a constant struggle. It is a close watch game where we try to understand competition movement and optimize on our media promotion spends.
4) The Market is already cluttered with many Curry Masala Brands, What made you bet on Melam?
While the category is cluttered, the segment is growing at a fast pace. The masala segment is especially growing fast. Given the size of the market, there is a good scope for any brand that has some equity already.
5) What are your revenue and turnover expectations from Brand Melam towards AVA Group..?
Our turnover for FY 2017-18 was around INR 23 crores.
6) As far as reaching out to target customers in terms of marketing, what are the top three challenges you are facing?
Masala and spices are very low margin products and hence most companies cannot afford sustained media spends to build a strong brand. The battle is, therefore, more on-the-shelf and in terms of distribution.
The challenge is that a lot of unscrupulous products compete for space with high margins to the trade. Finally, there are too many products in each category and promoting each one is just not possible
7) Your products are not just in the consumer segment, It is also sold largely through B2B spaces (like hotels) Is there any further expansion plans?
We already cover institutions through institutional distributors. While these are large customers, they extremely price sensitive and we have to really show value to be able to sustain a business with them. However, this is a segment that we are working on seriously besides direct consumer segment