Kolkata: Having jumped onto the retail bandwagon in a major way a couple of years ago, the tobacco-to-hotels conglomerate ITC Ltd is now set to straddle the realms of retailing greeting cards under the umbrella brand Expressions and gourmet Indian cuisine, deliciously branded as Kitchens of India.
Plans are afoot to branch out into the hitherto untapped vernacular greeting cards segment stationery such as notebooks and address books in the next financial year, as a logical corollary of extending the greeting cards business, launched in August 2000. ITC made its retailing foray into readymade lifestyle garments and decided to spread its presence in the other areas of retail.
For the greeting cards so far, it has been a success story. By January 2001, the company captured a market-share of 10 per cent of the Rs 300-crore greeting card industry. The lions share in the business is currently commanded by Archies, which has a market-share of Rs 100 crore.
"We are confident that over the next two to three years, ITC will be able to establish itself as the market leader in this business. This will be done by virtue of unparalleled distribution assets that the company already possessesthis will beat competition. This business has no incremental investment and there is no major capital expenditure gone into it," says company spokesperson S H Venkatramani.
ITC meticulously planned its marketing operations by relying on its inherent strength that of possessing a distribution network with a panwallah paradigm. The preferred option therefore was to tap the potential of the 2.5-million-strong force of retailers in the form of local panwallahs. These in turn became local ambassadors for market-seeding and brand-building operations.
"These tiny cigarette outlets became channels of market intelligence with the local diaspora giving valuable information about whether it would be feasible to have a greeting card rack at the local bookstore or not. In a way, they contributed to brand-building by spreading the word around," says Venkatramani.
As a result, Expressions greeting cards are now sold across more than 7,000 retail outlets, across 500 towns in the country a formidable task executed with a skeletal staff of just 30 persons.
Having taken care of minimising expenditure on the distribution front, it has also completely web-enabled its dealings with card retailers on all matters pertaining to design. Having a reservoir of 4,500 designs, retailers can now log onto to the company website, choose the designs they require and order them online. This saves tremendous costs and time, in contrast to couriering design brochures.
Expressions will be entering the states of Gujarat, Maharashtra, West Bengal and the four southern state markets by the middle of the current year. Greeting cards, a special business unit of ITC, has completely outsourced its logistics needs to the Singapore-based Semb Corp and plans to continue retailing through multi-brand shops.
"The greeting cards business is itself an extension of the existing businesses of ITC. It is a blending of expertise and competencies within ITC like paperboards, printing and packaging to create a new product line," says Venkatramani.
The story so far is quite similar with another of the companys retailing ventures that of selling packaged gourmet Indian cuisine under the brand name Kitchens of India. ITC Welcomgroup Hotels, which have a proven expertise in authentic Indian cuisine, has been synergised with the packaging capability of its packaging and printing division.
"This is yet another example of ITCs strategic endeavour to develop new product-lines by synergising its proven competencies," says Venkatramani. The Kitchens of India brand will initially promote three ITC Welcomgroups heritage cuisine Bukhara (Northwest Frontier cuisine), Dum Pukht (Avadhi) and Dakshin (South Indian).
The packaged ready-to-eat food is a premium product. With Dal Bukhara (with a price tag of Rs 190 per can that can be consumed by four persons) already appearing on the shelves of upmarket retail chains in Delhi, Mumbai, Bangalore, Chennai, Ahmedabad and select clubs in Kolkata, other delicious offerings to be introduced over the next two to three months include Chicken Chettinad, Kundan Kalia and Sabz Miloni.
Says Venkatramani: "The USP of these products is that absolutely no preservatives have been added, but the shelf-life of these foods is close to a year. This was possible by the use of a new techonology of retorting perfected over years of intensive research by expert chefs and food technologists to ensure freshness of cooked products without preservatives."
The export of these products is also being contemplated, once the national launches, slated in a couple of months time, are over.