Launching a new product range

Successful marketing organisations develop product ranges to meet the needs of selected groups of customers. These groups are identified by research which analyses customers’ needs and compares them with the products which are currently available. This allows the identification of gaps in the market where a new product could be introduced to meet a need which is not currently being satisfied profitably.

This case study examines how one of the country’s most innovative companies, Patak (Spices) Ltd., the leading supplier of authentic Indian food worldwide, has identified a market opportunity and launched a new range of ‘curry bases’. The curry base is a blend of natural spices, preserved in oil in a paste, which provides the foundations of an authentic Indian meal.

Although Patak’s currently holds a 67 per cent share of the paste market, the new product has been designed to introduce new consumers to the market by offering a more convenient size and pack format at a lower price, thereby encouraging trial amongst people looking for an authentic Indian product to prepare in the home for a meal for two.

The product

Patak’s was set up by the father of the current Chairman and Chief Executive, Kirit Pathak, in the late 1950s. On his arrival in the UK from Kenya, LG Pathak began by selling samosas from home to raise sufficient capital to buy his first small shop in North London in the late 1950s. The business expanded with the introduction of other products, including pickles and chutneys, as orders from small shops, housewives and students flooded in and Patak’s fame spread.

Kirit Pathak joined his father’s expanding company in 1970 and, with his wife Meena, who heads up product development, has spearheaded the company’s rise to the number two position within the UK’s Indian food sector. Patak’s supplies products to well over 90 per cent of the Indian restaurants in the UK, underlining its authenticity and Indian heritage.
Patak’s products are also available nationwide through independent grocers and major supermarket chains. In addition to being the No.2 brand in the UK grocery market, Patak’s is the most readily available brand on an international basis, being marketed in over 40 countries.

Patak’s ingredients are selected and imported from India and around the world, under Kirit Pathak’s personal supervision and blended under the direction of Meena Pathak. Meena, a qualified chef and expert on Indian cuisine, also takes personal responsibility for overseeing all recipe development. At the end of 1999, Patak’s held the dominant share of the UK’s Indian pastes market with 67 per cent of the market (its value share was growing at 35 per cent per annum). To understand the roots of this success we need a brief outline of Patak’s history to understand the organisation’s domination of the market is based on an ability to provide the most authentic Indian pastes in the market.

Growth

Patak’s has expanded quickly from employing six people in 1978 to 400 in 1999 and by increasing its turnover from £5 million in 1988 to in excess of £40 million by 1999. In 1994, the company acquired a food factory in Brechin, Scotland and, in 1997, a frozen food company in Dundee. This enabled the company to meet consumer needs for authentic canned, ambient and frozen Indian sauces, meals and accompaniments including breads,
pickles and chutneys.

In the modern business world we tend to associate rapid growth with the major established public companies like the soap powder giants Procter & Gamble and Unilever, or Coca-Cola from the soft drinks and beverages sector. It therefore came as a surprise to many in the marketing industry when the private company Patak’s won the award for the fastest growing grocery brand in 1993 and became the only company to feature in the top 20 fastest growing grocery brands over four consecutive years. This achievement demonstrates that there is still scope for the family-run business which combines knowledge of product with an understanding of market conditions.

Product development

In addition to developing recipes passed down through the generations by both Meena’s and Kirit’s families, new recipe ideas are constantly being created, all made from authentic Indian ingredients. The Patak’s range of pastes, for example, were created to preserve the original taste of spices by encapsulating them in vegetable oil. Fresh aromatic spices and fragrant herbs are carefully ground to bring out their subtle and varied flavours and are then blended with oil before being sealed in a jar, creating a convenient paste whilst retaining the freshness of the herbs and spices.

The company’s product range extends from pickles, pastes and chutneys to sauces in jars and cans, ready-made meals, pappadums, ready-to-eat naan breads and chapattis and now includes frozen meals and snacks. Patak’s packaging has been developed specifically to communicate its authentic Indian heritage and to generate greater brand recognition and range differentiation.

Building on success

Successful marketing involves identifying opportunities and then developing products to take advantage of them. Throughout the last quarter of the twentieth century more and more people in this country tried and then became regular consumers of Indian cuisine to the extent that, today, there are more Indian restaurants in London alone than in Bombay and New Delhi combined. As Patak’s became established as a brand name, it was able to capitalise on this growing popularity by selling to people who knew about Indian cuisine – restaurants and regular consumers of Indian food.

Consumer dynamics

In recent years consumers of curry pastes have been predominantly in the ABC1 categories (i.e. professional people and those in higher income groupings – doctors, teachers, accountants, business managers, office administrators, etc.). The market is also largely made up of younger adults in the 25-44 year age range who are more cosmopolitan in their eating habits (rather than older people who tend to be more conservative).

As consumers have become more educated about Indian food, more and more of them have started to cook their own meals using materials and ingredients from Patak’s and other suppliers. For example, by 1998, 54 per cent of all Indian food consumers were buying their own pastes.  And yet market research indicates that 65 per cent of UK adults do not currently cook Indian food at home. The main barriers to this are that:

• many people lack confidence, thinking that preparing Indian food is for ‘good cooks’ only
• many people think that there is a lot of time and effort required to produce good quality Indian food
• many people lack the knowledge of Indian cooking and of blending and using the ingredients. They are not sure about how much to cook, what to add during the cooking process, how long to cook the food for, what cooking methods to employ and so on.

Providing a solution – the new product concept

Given the growing interest in Indian food and the barriers above, Patak’s marketing strategy for its ‘curry base’ range is to meet the increasing needs of Indian food consumers for authentic ingredients by providing a product which has pre-mixed spices making it
a convenient, easy to use product which provides a quick meal.

The product concept which Patak’s has designed for its ‘curry base’ range is designed to make Indian cooking readily available to even more consumers. Patak’s has created a range of convenient, easy-to-use, one meal serving curry base pastes in a modern pack format, designed to attract new consumers. The company has also consistently sought to educate consumers about Indian cooking, particularly in the form of labelling with clear recipe suggestions. The initial launch of the new curry base range was focused on the three
most popular Indian flavours with UK consumers:

• Korma
• Tikka Masala
• Balti.

The pastes are packed in 80g sachets which are designed to serve two people. The pastes are also