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NZ Gourmet Food Producers Urged to Target India

Published: Wed 28 Aug 2013 02:02 PM
NZ Gourmet Food Producers Urged to Target India
Fine food producers in New Zealand looking for growth opportunities need to consider India, a market with a top-end income population as large as all the citizens of Japan.
Indian brand consulting firm BrandKnew Ideas (BKI) says the Indian gourmet food market has a compound annual growth of 20 per cent and is currently worth around US$1.3 billion.
New Zealand exported NZ$178 million of food and beverages to India in 2010, 106 per cent up from 2009[1]. However, the Indian packaged food industry is expected to be worth NZ$44 billion by 2016.
BKI co-founder Prashant Iyer says the Indian gourmet food market represents a wide open market for New Zealand gourmet food producers.
“Currently, organised retail[2] is in a nascent stage of growth as it has just a 5.9 per cent share in total India retail trade,” Iyer says. “However, in recent years, organised retailing has been growing at a robust rate due to the rise in the number of shopping malls as well as in the number of organised retail formats.”
Iyer says by 2015 middle class consumers in India are expected to constitute around 25 per cent of households and account for 44 per cent of disposable income. The figures for 2025 are 46 and 58 per cent respectively.
“Plus, increasing internet use and global travel means Indian consumers have become much more aware of brands and are compelling retailers to widen their offerings in terms of brands and in terms of variety.”
Another driver, Iyer says, is changing demographics.
“India is one of the youngest and largest consumer markets in the world. It is expected that more than half the population will be under the age of 30 by 2020, which means the potential for the Indian retail segment will be enormous.
“This population will be more dynamic than the previous generations because their consumption is driven by wants rather than needs. Thus, the organised retailing, which thrives on lifestyle products, is expected to receive a boost because of the young population by 2020.”
So why is there this new fascination with gourmet food among Indian consumers? Iyer says the trend is in line with India's growing economy.
“India has a growing base of super rich who are splurging their incomes on discerning consumables. Their aspirations are global in nature and hence the demand for high end watches, gourmet food, luxury bags and designer clothing.
“This is the demographic that global luxury majors are eyeing for growth – given the slackening of demand in the developed world.”
Iyer says the current perception of New Zealand foods is one of quality which has been coloured by a recently highly popular MasterChef Australia television series in India.
“There are other signs, too,” he says. “New Delhi's bustling INA market - once a hub for expatriates to shop for western ingredients - now attracts a large number of Indians hunting for handcrafted ham, almond tagine sauce, Swiss truffles, porcini mushrooms, Greek olives and much more.”
He says Indians are experimenting with all types of gourmet foods and wines – “they could be abalones, blue cheese, olives, avocadoes, wines and more”.
“India is a very complex country to navigate from a language, taste, culture and customs perspective,” Iyer says. “However, the well-heeled segment understands a global language, which has been influenced by travel and television. The focus on organic, health and fitness has created rapid demand for luxury gourmet items and this will continue to evolve exponentially.”
Iyer says BKI can help New Zealand gourmet food exporters by advising on market entry strategies, JV partnerships, market testing, legal and technical assistance and marketing and communications support.
“First point of contact in New Zealand is our associate Pead PR which has a specialist food industry team who can put New Zealand gourmet food producers in touch with us,” Iyer says.
India, by numbers:
Population:                                                                             1.21 billion (2011 census)
Gourmet food market:                                                      US$1.3 billion current; projected US$2.8 billion (2015)
Gourmet food compound annual growth rate:       20 per cent
NZ F exports:                                                                    NZ$178 million (2010), up 106% on 2009
Packaged food industry India:                                         NZ$44 billion by 2016
Middle class consumers:                                                   25% of households; 44% of disposable income (2015); 46% and 58% respectively by 2025.
ENDS

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