Home / Companies / News /  Parle to launch Frooti Fizz, the first extension of the brand in 32 years

New Delhi: Parle Agro Pvt. Ltd is launching a fizzy version of Frooti—the first brand extension for the popular mango drink launched 32 years ago.

Frooti Fizz is an attempt to build on the success of the original fruit beverage, which is Parle Agro’s largest revenue earner, making up more than 60% of the company’s sales.

Frooti Fizz, priced at Rs15 for a 250 ml PET package, Rs30 for a 500 ml PET package and Rs25 for a 250 ml can, will be retailed across 1.2 million outlets of the estimated nine million outlets in the country, according to the firm.

Parle Agro has set for itself the target of increasing annual revenue to Rs5,000 crore by 2018, from Rs2,800 crore, said Nadia Chauhan, joint managing director and chief marketing officer.

The firm has experimented with a fizzy variant in the past. In 2005, it launched Appy Fizz—the country’s first fruit-based fizzy drink that has grown at more than 20% a year in the past five years.

“Parle Agro created the fruit plus fizz category in 2005 with the launch of Appy Fizz. Today, we hold maximum market share in this category. The launch of Frooti Fizz is a step towards taking this category to the next level. Mango continues to be India’s largest consumed fruit flavour and there’s space for the fizzy version of the mango drink in the market," Chauhan said in an interview.

Parle Agro’s decision to launch Frooti Fizz, comes four months after the Food Safety and Standards Authority of India (FSSAI) set new standards for carbonated fruit beverages.

According to regulations, beverages with a fruit juice quantity below 10% but not less than 5%, and 2.5% in case of lime or lemon, should be called carbonated beverages with fruit juice.

FSSAI’s norms came about two years after Prime Minister Narendra Modi, in September 2014, urged multinational carbonated beverages firms like Coca-Cola Co. and PepsiCo Inc. to mix natural fruit juices (at least 5%) in aerated beverages to help boost fruit sales for Indian farmers.

Firms lined up to launch carbonated fruit drinks even before FSSAI set the standards. In July 2016, Real juice maker Dabur India Ltd launched Real VOLO, a fizzy drink that has 20-25% fruit juice content. In February, Bisleri International launched Bisleri Pop, an aerated fruit-based drink, to re-enter the carbonated beverages market that it exited in 1993.

Coca-Cola India, the local arm of the American beverages maker, sells Fanta Green Mango, a carbonated drink that has 10.4% fruit content. Its rival PepsiCo India Holdings Pvt. Ltd sells Nimbooz Masala Soda that has 5% lemon juice. Both Coca-Cola and PepsiCo are working on more fruit-based carbonated beverages, Mint reported on 22 July 2016.

The carbonated beverages category has experienced a decline in sales in recent years as juices and fruit-based drinks grew at a brisk pace.

In 2015, the juices category posted a volume growth of 20.06% and a value growth of 25.78% over the previous year.

Fizzy drinks, in the same period, grew 8.42% by volume and 10.82% by value, according to market research firm Euromonitor International.

Next year, Parle Agro will get into new categories and launch products in its existing business lines. Besides Frooti and Appy, Parle Agro sells Bailey branded water and soda and Hippo branded snacks, among others. More than 81% of its revenue comes from beverages, while water accounts for about 12.5% and the remaining comes from food and other products, according to the company’s website.

The company will be spending about Rs100 crore on the launch of Frooti Fizz, including the marketing expenses, said Chauhan.

Some analysts are skeptical about the potential of Frooti Fizz. “It’s a bit surprising why the company is launching a fizzy version of a successful brand when the carbonated beverages market is witnessing slow growth. It could have, instead, looked at the fortified drinks segment. As an extension of a successful mass brand, it might work, but eventually, the company will have to focus on fortified drinks," said Rajat Wahi, partner and head (consumer markets), at consulting firm KPMG in India.

Mango-based drinks account for the largest chunk of the juice-based drinks category in India. Coca-Cola’s Maaza, which the American firm acquired in 1993 from the Chauhan family-owned Parle Bisleri Ltd along with other brands such as Limca, Citra, Thums Up and Gold Spot, is still the market leader. Other brands in the category include PepsiCo India’s Slice and recent entrant Manpasand Beverages’ MangoSip.

Maaza led the Rs11,922 crore juices (up to 24% fresh juice content) market with a 36.1% share (retail volume), followed by Parle Agro’s Frooti (24% share) and PepsiCo’s Slice (22%) in 2016, according to data compiled by Euromonitor International.

Coca-Cola is targeting more than doubling annual sales of Maaza to $1 billion by 2023, from $400 million in 2015, Mint reported on 18 February 2016.

Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Recommended For You
Get alerts on WhatsApp
Set Preferences My ReadsWatchlistFeedbackRedeem a Gift CardLogout