Baskin Robbins eyes strong growth in snacking segment, targets 14-15% overall sales growth

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American ice cream chain Baskin Robbins is aiming further growth in India by expanding its snacking portfolio, which now includes ice cream sandwiches and bars.

Currently, snacking products contribute around 6-7 percent of Baskin Robbins' sales, Mohit Khattar, CEO of Graviss Foods Pvt Ltd, the told Moneycontrol in an interview on December 3.

The company expects this share to grow significantly. It also sees a robust overall growth rate of around 14-15 percent in the coming years.

Baskin Robbins entered India in 1993 through a joint venture with Graviss Foods Pvt Ltd.

Diversification move

The company announced its foray into the snacking segment in April this year. The move stems from an intent to diversify beyond its core ice cream offerings and capitalise on the evolving consumer preferences as the snacking market presents an opportunity to engage customers across different occasions and to expand revenue streams.

"Our focus has been on evolving the category from being perceived primarily as a reward-driven segment, as it was at one point, to positioning it as a snacking category today," said Khattar.

After COVID, the surge in demand for packaged goods in India has provided a significant boost to the sales of snacking items. Baskin Robbins seized this opportunity by diversifying its product portfolio, repositioning ice creams from a post-meal indulgence to an anytime snack option.

"Snacking products will increasingly have a larger share of the ice cream business. They may be contributing under 6-7 percent of our sales today, but we only see it growing in the future," added Khattar.

India entry

The American ice cream and cake chain entered India in 1993 through a joint venture with the Graviss Group . Its first manufacturing plant outside of North America was opened in Pune. In 2007, Graviss became the 100 percent owner of the Baskin Robbins brand in the SAARC region. Amidst robust expansion strategy, the company opened its 1,000th store in September this year and plans to have up to 130 stores opened every year .

The Graviss Group is a diversified business conglomerate in India, primarily known for its operations in the hospitality and food sectors. Beyond food, the group has interests in luxury hotels, including properties like InterContinental Marine Drive in Mumbai.

Robust demand in smaller cities

Meanwhile, Khattar also flagged strong demand from consumers in Tier 2 and 3 cities, given the increasing presence of online and quick commerce players and rising awareness of new products in these cities.

"Tier 2 and 3 cities are scaling very well and there is a greater demand for good quality products in these cities. Also, I think the the levels of competition in these cities are relatively lower and and that has worked well for us," he added.

Rising reliance on quick commerce

Q-commerce platforms are rapidly transforming India’s retail landscape, with $1.28 billion in sales expected to shift from traditional kirana stores to these digital entities this year alone, according to a recent survey by Datum Intelligence.

"The ice cream category has done very, very well on the quick commerce platforms, and, we, as a brand, have also done reasonably well for ourselves. It does seem that the consumer, who was earlier visiting, let's say modern trade stores or general trade stores, is substituting it with visits to quick commerce platforms. These visits are at the expense of visiting the market or visiting a store or visiting a physical store," Khattar said.

Going ahead, Baskin Robbins plans to capitalise on its presence across such platforms to drive growth.

"The strategy is very clear. We want to be where our consumers are. Our first allegiance is to our consumers and if our consumers are moving or changing their buying behavior, then we need to be where they are going," Khattar added.