With the onset of summer, mango-based drinks are back with compelling commercials on television, peddling the belief that they are all you need to quench your thirst on a hot day.
Mango-based drinks—much like the fruit itself—are expected to be in high demand during the peak summer season in the country. Companies are all set to push them even more aggressively this time around as they expect a normal season after two years of supply and demand disruption due to the Covid-19 pandemic.
But what drives the craze for mango-based drinks such as Maaza, Frooti and Slice in India?
“Maaza is now bigger than Coke in India,” a top executive at The Coca-Cola Company said in February.
According to the company, Maaza reported sales of Rs 2,826 crore in calendar 2021 even in challenging circumstances due to the pandemic. Maaza is the No. 3 brand in the overall beverage category for Coca-Cola India and made significant gains in market share last year, Ajay Konale, director marketing, nutrition category, Coca-Cola India and Southwest Asia, told Moneycontrol.
However, it’s not just Maaza. According to industry data, mango-based drinks as a category are huge in India. Some experts estimate that mango-based drinks command the largest chunk of the Rs 11,000-12,000 crore packaged fruit drinks market in India.
According to Rishav Jain, managing director, Alvarez & Marsal, who leads the consumer internet, consumer, retail and agribusiness sector for A&M, mango-based drinks contribute about 75 percent share of packaged fruits drinks segment in the country. The market, said Jain, was growing at about 9-10 percent in the pre-pandemic times.
King of fruits (& drinks)
While the popularity of mango-based drinks can be attributed to many factors, ‘the great Indian mango fetish’ is largely driving it.
“I don’t think there’s any fruit in India that evokes as much joy, passion and excitement as the mango. Many seasonal fruits come and go without being noticed,” said Nadia Chauhan, joint managing director at Parle Agro, which houses Frooti. “But when it comes to mangoes, you will even find people posting about it on social media, celebrating or enjoying the first set of mangoes for the season. The fruit is available for a limited period (or is seasonal) which makes it even more desirable.”
However, some experts indicated that the popularity of mango-based drinks is as much supply-driven as demand-driven.
“The supply chain for mango-based drinks is very well developed,” said Jain of A&M. “The industry majorly uses Totapuri mango and sometimes a blend of Alphonso (also known as Hapus) as the pulp in these drinks and about 75 percent of the world’s Totapuri is grown in India.”
The fruit has supply-chain advantages over other products, he said.
Big companies in the non-alcoholic beverages market such as Coca-Cola and PepsiCo have capitalised on the craze for mangoes along with the steady supply of the product over the years.
PepsiCo started manufacturing Slice in the 1980s, while Maaza was acquired by Coca-Cola India in 1993 from Parle Bisleri. Frooti was launched in 1985.
While ITC and Parag Milk Foods have entered the category in recent years, Maaza, Frooti and Slice still command the largest shares. Maaza, according to industry estimates, has about 40 percent share of the mango-based drinks market in India, followed by Frooti at 28 percent and Slice (PepsiCo) at 23 percent.
“Most large companies focus on this category and have even launched low unit packs (LUPs) of Rs 10, making it accessible to the lower income strata as well,” stressed Jain. “Diversification into other fruits has been limited in the juice drinks segment by the leading players.”
Such initiatives have helped Maaza derive about 40 percent of sales from rural India and the company plans to go deeper into the country.
“With improving rural demand, the company is progressively devising innovative ways to reach the last mile through a host of digital mediums and ensure regional outreach and uninterrupted product deliveries,” said Konale of Coca-Cola India.
The company will look at more investments to build capabilities and new business models. New variants such as Maaza Gold have led to further growth of the category.
Summer is here
After two years of disruption on account of the pandemic, companies expect a normal season this summer.
In 2020, the pandemic struck just before peak summer and purchase volumes in the non-alcoholic beverages category declined 25 percent between April and September, according to Kantar. However, there was a recovery of 26 percent in April-May last year, as per Kantar, and after this brief lull, the market is set to grow again.
According to Purnendu Kumar, senior director of PGA Labs, a business research firm, the overall market for packaged juices is expected to expand at a compounded annual growth rate of 16 percent by 2025.
Companies are gearing up to tap the growing demand with promotions. Parle Agro announced the appointment of popular Telugu actor Ram Charan as brand ambassador for Frooti last week along with Alia Bhatt, whom it had signed up in 2018.
Maaza launched its latest campaign ‘Dildaar Bana De,’ featuring veteran actor Amitabh Bachchan, along with Pooja Hegde, in February.
While the stage is set for growth, there will be stiff competition from carbonated beverages (cola drinks), which are vying for the same set of consumers. The market for carbonated beverages is estimated at about Rs 20,000 crore, of which cola-drinks account for Rs 12,000-14,000 crore.
However, they face challenges as consumers move towards ‘healthier drinks.’
“There is a segment of customers who are getting health conscious and avoiding high sugar content products. These consumers are switching from fruit drinks to fruit juices,” said Kumar of PGA Labs.