Bauli gears up for next phase of growth ahead of completing 10 years in India
Bauli, the Italian bakery and confectionary brand, is set to complete a decade in India in 2019. The company entered India in 2009 in West Bengal through a joint venture with Dream Bake. It started with the production of ready-to-eat, cream filled puff rolls. After receiving overwhelming response from the East markets, Bauli expanded to the rest of the markets in India with the entire range of soft fine puff rolls, the flagship product called Bauli Moonfils.
As per media reports, Bauli proposes to invest around €80 million in India and has already invested a reported €35 million in setting up a manufacturing facility in Baramati near Pune, Maharashtra. The company has now devised more growth plans for other markets across India.
Adgully spoke to Stefano Zancan, Global CEO, Bauli; Veenesh Priyadarshi, Sales & Marketing Director, Bauli India; and Anil Nair, CEO & Managing Partner, L&K Saatchi & Saatchi, to know about Bauli’s growth in India, marketing strategy, advertising plans, the road ahead and more. Excerpts:
Can you share some details about your global growth and your market share in the global arena?
Stefano Zancan: Bauli is not a very big company – it is half a billion euro in size. In terms of potential growth, we have to pick markets and regions of the world in which we want to develop. India is really the first region outside of Italy in which we want to establish ourselves. In all other regions, we are served more by trading companies, which includes shipping. Baramati near Pune is the first manufacturing unit that we have established outside of Italy.
How has your journey in India been so far?
Stefano Zancan: Coming to India was not easy at all, because India has a high level of complexity. You need to be very humble and make a serious effort to understand this market due to the complexity of managing relationship with the Government, because they are not one but many. India, for me, is not a country but rather the ‘United States of India’! Everything that you see around you demonstrates this. Now you have a national GST, but before that it was really very different. As for culture, India is an amazingly complex and rich historical development. In dealing one end with another in India would be like having a Russian in talks with a Portuguese! So, we need to put an effort into understanding that there are many languages and many cultures and probably it is impossible to have one pair fits all and so we need to develop enough amenities in tune with all the consumers across India. That is a major effort.
The second point is that starting from scratch means not having a history in this country, which means the effort in letting people know that we exist is a very big one. That is why I am saying that getting into India is not simple, partly because entering a new market in which you are unknown is anyway a difficult exercise, whereas on the other side there are the ways of India that you have to respect. There is a saying that goes ‘It could be hard to get in, but then you have the true competitive advantage against anyone who wants to come in after us’, and that’s why I believe this is the right time to be here.
What is the extent of your presence in India since your launch here in 2009?
Stefano Zancan: We launched first in West Bangal in 2009 in partnership with Dream Bake, but now we are purely on our own. There is still a deal in place for the benefit of everybody who was involved at that point in time and that partnership predominantly covers West Bengal, the Seven Sisters, Odisha, Bihar and others. As we progressed we realised that there wasn’t enough capability, hence we decided to shift our base to Maharashtra on the manufacturing side and from there we built our sales force.
Veenesh Priyadarshi: Between 2009 and 2016, we were servicing only the eastern part of the country. Our factory in Baramati came up last year and in the last 12 months or so we have started sales and distribution across the entire country. As of now, we cover the entire part of the country from Kerala to Jammu and Kashmir and from Gujarat to the East. We cover more or less all the channels – there is general trade, e-commerce, and we have our footprint across all these channels across geographies.
Are you also planning to set up individual stores?
Veenesh Priyadarshi: Not really. Bauli as a group is into long shelf life bakery products, we are not into fresh bakery products even in Italy. Our aim is to give consumers a lot of products that have a long shelf life that can be distributed across the length and breadth of the country.
Stefano Zancan: It is true that in Italy we do a have couple of retail points as well. But this is a different type of business and it is managed separately. It is a concept that we are considering, but it is not something that we want to roll out in an important way anywhere around the world, particularly in India.
Who are your prime competitors?
Veenesh Priyadarshi: The competition is from bakery brands like Britannia, Parle, and General Mills. As of now though, no one else in the market has the product that we have. Ours is a new company, a new brand, a new product category and a new team – so pretty much everything is new. The last one year has been full of learning. The good thing is that at the end of that journey we have come out alive and kicking.
As Bauli’s creative agency, how has L&K Saatchi & Saatchi helped build up the brand through its advertising and communication?
Anil Nair: From day one we understood the equation of a new company, new brand, and new category, so rushing into communication and rushing into making wonderful campaigns was not in the plan. Ours is not a campaign-focused strategy, though we have done television commercials and all that, but the fact is that our focus has been to support Bauli for the long term, because they have been quite humble. But the fact is that they have gone around and developed quite a lot of concepts around the world and that is Bauli’s differential as opposed to the many names that he has taken, even if it is General Mills for that matter.
Bauli offers new cuisine opportunities in India, giving it a twist – they also have an unbelievable range of cakes around the world. As an agency our attempt is to actually partner them in being market partner and market expansion partner and therefore, work closely with the marketing team in planning each role out and preparing for newer concepts. I think that’s the whole interesting thing about Bauli – everything is new. It is not starting with any context, so you are not looking at the competition; we are fighting to create a new habit. We are fighting our way into tiffin boxes or snack boxes, where such a product was not there before.
A whole lot of work needs to be done, and while you might see the tip of the iceberg outside, what goes on inside is a long term game and we understood that from day one when we were briefed. If you look at it, a lot of companies have come to India, but not one of them has put a penny on the ground as far as manufacturing is concerned. It is a whopping investment, coming from a company of their size in a market like India.
Stefano Zancan: You see, that is the difference. As I said earlier, this is a family business and I am very glad to say that I have never worked for anybody else but family businesses all my life and the reason is because you can think long term. The purpose of the exercise is not making money. It is producing great food that the people can enjoy, because this is the spirit of the founder. This is about making certain type of bakeries that are not common around the world that we believe that a lot of people could really love. When you start with that principle, then you cannot really compete with those others that I prefer not to mention, because they have another way of thinking.
Anil Nair: When you are in a market that is changing and you are actually leading it, the learning curve for you is sharper and interesting. The thing is that the market has not changed, it is changing. The continuous term here is the critical thing.
The frequency of campaigns will now go up as a support to what is going on ground, across geographies and the depth and width of distribution.