How Maggi noodles became Indias favourite comfort food!

The noodle category has been growing over the last few years at a commendable pace and the
growth is attributed to various factors like working couples, time poverty, increasing disposable
income and the desire of the younger generation to try something different.
Maggi Noodles was launched by Nestle India in 1982 as 'Maggi 2-Minute Instant Noodles' under
the prepared dishes category. It used the tag line fast to cook, good to eat' to woo its target
group, along with its catchy jingle Mummy Bhook Lagi Hai' which helped in positioning the
brand. Thus, becoming the runaway favorite of children. Off late mothers across India have
shown growing concerns over the empty calorie content and low nutritional value of Maggi
Noodles. However, the recall power of brand Maggi is still very strong.
The Swiss brand Maggi (owned by Nestl) makes a variety of productsincluding bouillon
cubes, various Asian-type sauces, and powdered soupsbut in India the word is essentially
synonymous with 2-Minute Noodles. Maggi noodles first appeared on the market here in 1983,
and over the next 25 years, they enjoyed a 90% of the instant noodle market (that share has
dropped in the last few years, thanks to the introduction of other brands like Top Ramen and Wai
Wai).
Maggi offered convenience to the housewife and at the same time did not undermine her
involvement with the kids. The masala flavor made its way in to the minds of the consumers, and
Maggi found a place in the monthly budget plan of a household. During the nineties competitors
like Indo-Nissin launched Top Ramen - a similar product but with a twist in the taste. This ate
into Maggis market share. Maggi tried innovating and a new flavouring agent named
tastemaker was added. However, this did little to recapture their lost market share and Maggi
Noodles Masala was completely phased out. For two years, Maggi experimented with its noodles
and a number of new variants were tried, including the Maggi Macroni. However, none of these
innovations helped Maggi regain its erstwhile glory.
According to research firm Euro Monitor, Nestl India is the dominant player in noodles with a
60 per cent share of retail value sales in 2013. Brand 'Maggi' has performed very well due to the
wide distribution network. It also enjoys consumer loyalty owing to the fact that it was the first
instant noodle brand to be introduced in India.

Finally it reintroduced the original Maggi Noodles Masala in 1999, but this time keeping in mind
the market trend, they gave it a twist of healthier and tastier. This proposition did wonders for
them and within a year, it went on to becoming the market leader. Nestl India has also been
proactive in launching new variants, such as Maggi Dumdaar noodles, Maggi Atta noodles and
Maggi Curry Noodles.
Maggi uses various strategies, including the Nestl Maggi Har 2-minute mein Khushiyan
promotional campaign, to increase sales and maintain its undisputed leadership in the instant
noodle category. The campaign gave consumers opportunity to win mobiles, cameras, vacation
vouchers, microwaves, washing machines and cars. Nestl focuses on point-of-purchase displays
and its visibility in the small and independent retailers is the highest compared with other brands.
Nestl provides better credit solutions to retailers which other companies fail to provide.
However, it has been facing competition from new entrants like Hindustan Unilever's Knorr and
ITC's Yippie who are looking to take a significant share in the Rs 2,200-crore instant noodles
market. The manufacturers are targeting rural consumers with smaller pack variants and also the
urban consumers with health and wellness offerings such as wholegrain, atta (wheat flour), real
vegetables and recent one like oatnoodles.
Noodles in India saw value growth of 19% in 2014, taking sales to Rs52.8 billion. This growth
was slightly lower than that seen in 2013. However, the category is still showing a strong doubledigit performance. Demand for noodles is credited to the hectic lifestyles of consumers
as noodles provide a quick meal with nutrition, whilst most Indian food take a long time to
prepare. Secondly, with consumers getting more heath conscious, noodles manufacturers
launched healthy variants in 2014.
Competitors are increasing distribution and penetration into smaller cities and rural India will
continue to grow at a rapid pace. Focus on health and taste by manufacturers will drive growth in
the coming years in urban India. Disposable incomes and modern trade will also help, and the
government outlook for the next five years is very vibrant.
Now it is for us to see how Maggi manages to retain its market share in the face of rising
competition from FMCG majors.

Category Data
Table 1 Sales of Noodles by Category: Value 2009-2014
INR million

2009

2010

2011

2012

2013

2014

Chilled Noodles

Frozen Noodles

Instant Noodles

14,401.02

19,273.83

24,961.73

31,028.07

37,809.62

45,561.89

- Cups/Bowl Instant Noodles

206.94

240.27

274.00

312.45

352.91

396.26

- Pouch Instant Noodles

14,194.08

19,033.56

24,687.72

30,715.61

37,456.71

45,165.63

Plain Noodles

4,368.96

4,849.93

5,344.37

5,904.42

6,502.22

7,227.56

Snack Noodles

Noodles

18,769.98

24,123.77

30,306.10

36,932.49

44,311.84

52,789.45

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews,
trade sources

Table2 Sales of Noodles by Category: % Value Growth 2009-2014

% current value growth

2013/14

2009-14 CAGR

2009/14 Total

Chilled Noodles

Frozen Noodles

Instant Noodles

20.50

25.90

216.38

- Cups/Bowl Instant Noodles

12.28

13.87

91.48

- Pouch Instant Noodles

20.58

26.05

218.20

Plain Noodles

11.16

10.59

65.43

Snack Noodles

Noodles

19.13

22.97

181.24

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews,
trade sources

Table 3 Brand Shares of Noodles: % Value 2011-2014

% retail value rsp

Company

2011

2012

2013

2014

Maggi

Nestl India Ltd

60.58

59.67

61.64

63.11

Sunfeast

ITC Ltd

3.40

5.30

8.31

10.81

Bambino

Bambino Agro Industries Ltd

6.43

5.84

5.43

5.10

Top Ramen

Indo Nissin Foods Ltd

4.69

3.91

3.35

2.50

MTR

MTR Foods Ltd

1.59

1.47

1.35

1.31

Wai Wai

CG Foods India Pvt Ltd

0.42

0.50

0.67

1.26

Ching's Secret

Capital Foods Ltd

1.47

1.35

1.27

1.19

Knorr

Hindustan Unilever Ltd

2.49

2.08

1.79

0.83

Smith & Jones

Capital Foods Ltd

0.25

0.33

0.43

0.65

Taii-Paii

Maruthi Quality Food Products Ltd

0.24

0.30

0.42

0.60

Savorit

Savorit Ltd

0.64

0.60

0.58

0.56

Nissin

Indo Nissin Foods Ltd

0.60

0.53

0.51

0.50

Bluebird

United Agro Industries

0.62

0.52

0.44

0.40

Horlicks

GlaxoSmithKline Consumer Healthcare Ltd

1.59

1.16

0.85

0.38

% retail value rsp

Company

2011

2012

2013

2014

Mom's Choice

Prayag Foods Pvt Ltd

0.33

0.33

0.28

0.25

Leong

Leong's Food Products

0.10

0.08

0.06

0.04

Sams

Sams Food Products Ltd

0.08

0.06

0.05

0.04

Wai Wai

Nepal Thai Foods Pvt Ltd

Private label

Private Label

1.16

1.19

1.23

1.26

Others

Others

13.32

14.78

11.33

9.21

Total

Total

100.00

100.00

100.00

100.00

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews,
trade sources

Table 4 Forecast Sales of Noodles by Category: Value 2014-2019

INR million

2014

2015

2016

2017

2018

2019

Chilled Noodles

Frozen Noodles

Instant Noodles

45,561.89

50,607.01

56,045.93

61,674.46

67,497.02

71,983.56

- Cups/Bowl Instant Noodles

396.26

407.72

417.71

427.57

436.67

438.72

- Pouch Instant Noodles

45,165.63

50,199.29

55,628.22

61,246.89

67,060.35

71,544.84

Plain Noodles

7,227.56

7,385.93

7,558.36

7,747.10

7,941.00

8,036.52

Snack Noodles

Noodles

52,789.45

57,992.94

63,604.29

69,421.55

75,438.01

80,020.08

Source: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources