While international pizza brands were responsible for creating the pizza eating culture and occasion in India, the excitement in the category is coming from homegrown players who are willing to experiment.
If you are a foodie and also a user of social media, it is highly probable that you have come across posts that tempt you to try the hottest, sometimes literally, newest pizza around the block. Just to help paint a picture, these pizzas could be claiming to be authentic Italian or these could be at the other end of the spectrum, like a pizza with butter chicken topping or for the spirit aficionado, an Old Monk pizza. The list of variations, blasphemous or otherwise, is only growing. What takes the pie, in this case, is that most of these experiments are not being rolled out from the kitchens of the Pizza Huts or the Domino’s’ of the world but from homegrown players.
KPMG’s India’s Food Service Industry: Growth Recipe report says that currently, full-service restaurants and quick service restaurants (QSRs) together make up for 73% of India’s food service industry. The key drivers fuelling consumption in this space, KPMG finds, is a combination of four factors: the youth population, increasing disposable incomes, changing consumer lifestyle and an increase in the urban working woman population.
A slice with the topping
While innovation, either in product, service or experience, does not depend on the size of the company doing it, one expects it to happen from the big players in the field given the resources and access to data they have. On the home front though, smaller pizza players are wooing customers as they are not bound by international standards or rigidity of processes that govern the operations of multinational players. Juno’s Pizza, started in 2009 by Aditya Shah, is an all-vegetarian brand and currently has nine outlets across Mumbai. Shah is looking to have a presence in Gujarat soon with a store ready to operate in March, 2018. The brand is currently also evaluating franchise queries from Gujarat and by end-2018, would start looking to attract funding/investments. Currently, a no-frills average ticket price for Juno’s stands at Rs 550 for two people and the brand sees a 45% repeat customer rate.
The challenge, Shah says, is gaining the trust of the consumer. “We don’t have the marketing budgets and brand recall that MNCs have. Encouraging people to make the first purchase is a challenge,” he says. However, having a presence on platforms like Zomato and Swiggy helps. Juno’s sees 30% of the delivery sales coming in from these platforms. Offline, 70% sales come in via delivery and the rest from dine-ins. Shah emphasises that the size of the company allows him the flexibility to implement changes or innovations quicker. For example, it had rolled out the 20-inch pizza during the IPL season a few years ago. Upon customers’ requests, it has also tried its hand at a heart-shaped pizza, something an MNC won’t necessarily do.
Straight from the oven
Consider Lloyds Luxuries’ 1441 Pizzeria, which began operations in 2016 with two stores and three shop-in- shops in Mumbai. The year 2017 was all about expansion. With two stores up and running, there are plans to add five more. Having hit the one-year mark, the brand has set its sights on Pune with a store under construction. In the next financial year, Bengaluru and Hyderabad will be added into the fold. Istayak Ansari, director and co-founder, Lloyds Luxuries, shares, “In the coming financial year, we plan to set up four outlets in Bengaluru, two in Hyderabad, and four more in Mumbai and Pune.” Wanting to provide an added experience in lean hours, the brand allows its customers behind the counter to make their own pizza. The live dough stretching counter is also counted by the brand as a differentiator. 1441 Pizzeria sees 30-35% customer retention (once in three months, on an average). It expects delivery to be a major component in the next few years and contribute 50% of sales. Another player, albeit of a different scale, is looking to have a play in the pizza segment. Faasos’ Ovenstory currently has 100 outlets across 13 cities serviced by cloud kitchens. It offers flavoured cheese bases in four variants namely, Peri Peri, 4 Pepper, Chipotle and El Classico. To encourage consumers to try other variants, it sometimes supplies two dips of other variants in addition to the regular order.
Sagar Kochhar, chief marketing officer, Faasos says, “Fatigue sets in when a consumer keeps having the same product from the same brand for an extended period of time. While that means continued growth for a brand, it also opens an opportunity for the user to try something new and exciting when the option presents itself as part of the consideration set.” The plan is to add five-seven locations every month in the next financial year.
Sreedhar Prasad, partner and head, consumer markets practice, KPMG India, notes that most of these players are capturing attention by marketing their offerings as an ‘experience product’, given the dine-in experience. International players seem to have overused the fast food concept and local players are busy reaping the benefits of that.