Nestle India banks on value-added innovations

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With a sharp focus on the health and wellness platform, Nestle India has been in the pink of health over the past two quarters. Its sales growth has outperformed that of the industry. From probiotic curd to rice noodles, Nestle India is banking on value added innovations. While it has never made acquisitions in this country, it is watching local brands in the culinary of prepared food space closely. joined us for his first TV interview since he took charged in 2004.

There is a new sense of aggression at Nestle India. The company that owns some of India's best brands from Maggi instant noodles, then Nestle milk and dahi to Nescafe and a host of baby food brands is focused on increasing its presence in the dairy space and on innovations tailor-made to the Indian palate. It's latest launch, the probiotic curd NesVita, is seeing a rather muted media campaign. Nestle India 's Chairman and Managing Director,  Martial Rolland talks about what they needed to do to sell curd that's even healthy than regular curd.

Excerpts from CNBC-TV18's exclusive interview with Martial Rolland:

Q: In India, a lot of people still make their curd or dahi at home and they are aware of good bacteria. What is the education that you need to do, why is it that I would need to have probiotic NesVita?

A: Clearly, your good bacteria is very good for you, there is no question about it, very-very good for you. But this one is even better because it has an added bacteria, which acts very positively on your digestion. It is going to be a long journey where there is going to be a lot of education required for people to understand what the benefits of probiotics are.

But the good news is as more and more companies are going to embark in that direction, and this is going to increase the market.

Q: You mentioned NesVita is in three cities, we know that you have launched Milkmaid Funshakes, fruit flavored milk drink in southern cities. How long before national rollouts, what are you waiting for?

A: Clearly, in the case of chilled dairy, it has to do a lot with infrastructure. When it comes to products like Funshakes, it has to do more with testing the water.

Q: Testing the water brings me to the question of, is it time to test the waters again where water is concerned, because you exited about three and half years ago?

A: I wouldn't be able to comment, but really what I can say is that it is a very interesting market, but it is a fairly crowded market, we are the biggest one in water worldwide.

Q: When it comes to chocolate, Cadburys is sitting pretty at number one for the longest time. When it comes to confectionary, you have been making a lot of noise and you have ITC foods now - very aggressive. How would you evaluate your chocolate portfolio?

A: I do think that we have done very well in one area, which in an area of products like Munch and Kit Kat, we clearly have a market leadership. Yes, in plain chocolate, this is an area where there has been for the longest period of time a very strong competitor, and remains a very strong competitor.

But I think it is like running the 100 meters, we don't run the 100 meters alone, it is good to have competition and is very heartening to see some very strong competitors. Yes, on the sugar confectionary front, we have been doing fairly well with Polo and Nestle Eclairs.

Q: We haven't seen a launch in this space in a while?

A: No, we did. We actually have launched product called Munch Pop.

Q: It's a variant?

A: No, this one is not a variant. It puts you in a completely different arena, which is the snacking arena. It's a bigger arena here in India.

Q: Tell us about the out-of-home consumption of beverages and the sort of proliferation in cities of coffee parlours or cafes. How has it affected consumption or are you still looking at institutional sales for that?

A: I would say that when it comes to out-of-home, the advent of coffee is very positive, because I do think that it popularises the drinking of coffee. So it is very good for a company like ours.

Q: So it is helping the coffee drinking habitudes?

A: There is absolutely no question. We do have our Nescafe cafes as well. To a smaller extent, compared to some of the other companies, which are purely engaged in the out-of-home segments.

Q: What about the 3-in-1 single coffee cup pack, how is that doing?

A: This has been difficult, I would say and therefore this is an area where we are re-looking at it.

Q: Is that on the product end or the market end?

A: I think it is probably a question of focus, sometimes you have smaller new launch, which comes in but doesn't receive the attention one would like.

Q: Maggi - what is happening on that front? Some innovations there when it comes to taste for the Indian palate? How successful has those innovations been?

A: All the launches that we have had on Maggi have been fairly successful. There have been varying degrees of great success and some are little bit less. But all of them have contributed to the health of the brands.