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Gouri’s Cereals: The Packaging Dilemma for the Challenger Brand

CASE STUDY, BRAND MANAGEMENT
ET Cases, 12 Pages
AUTHOR(S) : A. J. Swapna and Dr. Nagendra V. Chowdary

Case Preview

Gouri’s Cereals: The Packaging Dilemma for the Challenger Brand

 

On August 1st 2016 with the incessant rains, Mumbai’s temperature dropped to 23 degrees Celsius and the climate very windy. The Monday morning traffic moved at snail’s pace. The meeting at 11am to Gouri’s was already delayed by 20 minutes.

Before the interview began, Vidur Gupta (Vidur), Managing Director of Gouri’s offered a fresh shot of Latte Macchiato brewed from Blue Tokai. While walking towards Gouri’s office (located near the iconic Mahalakshmi Race-course, in the Unit 27 of the industrial estate of Mill Street), Vidur, sipping and savoring his freshly brewed coffee remarked that, Gouri’s has experienced a steady increase in its orders from its inception but the demand didn’t come as a surprise to the startup because the growing health conscious segment were looking for healthier food to munch on and that is what they truly provide.

To validate this better, he walked towards the Unit 27 to his office. Located inside the mill estate, as you enter in, the aroma of palm jaggery, honey, chocolate and sesame fills up your senses. His office had several boxes of Gouri’s cereals neatly stacked up in a corner, white boards had plan of action for the week and to-do lists for the day. While four women were busy sorting and measuring cereals, de-seeding dates and pounding the cereal bars, Gouri Gupta (Gouri), the founder of Gouri’s artisanal energy bars, was guiding one of the staff member in packaging and labelling the energy bars and crumbles. The rest of the space had a properly designed compact and clutter-free kitchen. It had a counter/platform with ample space and storage cabinets shelved neatly underneath the staircase and the staircase leading to a small office space of Vidur. Before we sat down for the interview, Vidur offered palm jaggery and Belgian milk chocolate mini energy bites which were a perfect blend of nutritious ingredients, good taste and honestly delicious!..................

The Changing Landscape of the Indian Breakfast Cereal Market

With a population of over 1.2 billion and a rapidly expanding middle class segment ready to spend, India offers untapped potential for several stakeholders in the market, especially the packaged food under the breakfast and cereals category. Primarily because the consumers for breakfast cereals are urban consumers who prefer a ready-to-eat (RTE) breakfast due to their busy and fast paced lifestyles. Cornflakes, as a category, has been dominating the breakfast market with highest market share, which in itself is a INR400 crore category, whereas other cereals like oats and muesli account for the rest. According to the Indian Breakfast Cereal Market overview, India’s breakfast cereal market is growing at a CAGR of 22.07% since 2010..........

Booming Breakfast Cereal Market in India: Breaking the Traditional Breakfast Habits and Propelling the Health Conscious Segment

Due to urbanization and increased income levels of people, India has the largest market share in breakfast cereals. As Indian consumers are moving towards better convenience and healthier life style, the breakfast cereals have become an important category in food and beverage industry. According to industry estimates the health and wellness category accounts for INR2,000 crore which is a minuscule part of the overall food market and is expected to grow faster, at 20% a year compared to 10-15% growth for the overall market................

Gouri’s: Betting on the Indian Breakfast Cereal Market

Gouri’s is a Mumbai-based gourmet bakes, snack and handmade energy bar maker of semi-organic cereals based products catering to both young and the aged. The startup emphasized on its organic business practices and sustainable packaging practices. With competition from the likes of Nestle, Kellogg’s, ITC, Patanjali etc., Gouri’s CEO and Managing Director, Vidur was keen to build a niche cereals and bars brand in India by reaching out to the customers and building on the personal relationship edifice.....................

Gouri’s Product Differentiation: Sourcing Right Ingredients with Premium Pricing

“The cereal boasts high-fiber, high-carb and high-protein, making it a wholesome breakfast for those on the run. The idea is to offer yummy options that rank high on the health. You can eat anything you please, but what you eventually opt for makes all the difference in the long run”, stated Gouri Gupta. Gouri’s offered a variety of products in cereals and energy bars category. All the products were handmade and used minimal packaging. For instance, its energy bars were wrapped in sealable plastic pouches while cereals had a either box packaging or plastic packaging...............

Sustainable Packaging: To Drive Sales in Shelf Space?

Gouri’s used a simple plain packaging with just the nutritional information printed on the pack. The company used just enough packaging so that the products reached the residence of its customers safely. The customers were happy and satisfied with the simple packaging too. It must be noted that the cereals and bars market was experiencing an explosion in packaging due to the increasing importance of packaging as a marketing tool. But to make Gouri’s more appealing to the customers and to have a visibility on the retail shelf and for international space, Gouri’s upgraded to a 100% recyclable brown paper as a packaging standard, (Exhibit IV)............

Gifting Goodies and Happy Customers!

As a home-grown business, Gouri’s had a very impressive base of highly satisfied customers. But the fact that every customer came back with another order showed the impressive customer base they have. With the tagline, ‘Honestly, Delicious’, Gouri’s products were popularly being used as return gifts in weddings, baby showers and other events (Exhibit VII). Vidur says that, “the customers keep ordering as they appreciate the nutrition and taste they get from every bite. Customers place customized orders from Gouri’s”...........

Assignment Questions

I. Discuss the changing landscape of the Indian Breakfast Cereal Market and elucidate on the consumer’s paradigm shift-breaking the traditional breakfast habits and turning towards the health-conscious segment.
II. What are the key brand elements of Gouri’s that can establish itself as a formidable brand in cereals and energy bars category? Design an appropriate Product Differentiation for a fledgling brand like Gouri’s, given the resource constraints and the nature of competition.
III. ....................

Exhibits

Exhibit I: Gouri’s Product Range – Under Essential Health Category

Exhibit II: Gouri’s Product Range – Under Essential Soul Category

Exhibit III: Comparative Prices of Gouri’s and Branded Cereal Makers (in INR)

Exhibit IV: Gouri’s Cereal Boxes displayed in the Retail Stores

Exhibit V: Nutritional Facts Labelling Panel of Gouri’s Cereal Box

Exhibit VII: Gouri’s Getting Popular as Return Gifts

Exhibit VII: Gouri’s Getting Popular as Return Gifts

Teaching Note Preview

Gouri’s Cereals: The Packaging Dilemma for the Challenger Brand

 

Synopsis

Gouri’s differentiated itself from other cereal makers as a cult brand of energy bars through its innovative product range, greater customer service, unconventional marketing approach, and uncompromising quality. Though Gouri’s had around 4,500 highly satisfied customers1 across the country, the company is yet to compete with the established FMCG players. With a goal to achieve INR100 crore by 2020, the plans are in place to create a top-of-the-recall brand in the category with its packaging practices. With no deep pockets to splurge on marketing blitzkrieg and with a keen focus on building a ‘differentiated’ brand through natural ingredients, can Vidur Gupta’s plan to scale up a neighborhood hobby into a sizeable business and make a challenger brand, fructify? What are the specific yet costeffective branding initiatives that he should opt for?

Prerequisite Conceptual Understanding (PCU)/Before the Classroom Discussion

This Case study’s discussion would be more effective if the participants understand the concept of packaging in building a brand’s brand equity. A preliminary understanding of this concept can be had from the following suggested chapters and the video:

  • • Kevin Lane Keller, et al., “Choosing Brand Elements to Build Brand Equity”, Strategic Brand Management, 3rd Edition, Pearson Education, Inc., 2011
  • • Kevin Lane Keller, et al., “Measuring Sources of Brand Equity”, Strategic Brand Management, 3rd Edition, Pearson Education, Inc., 2011
  • • Kevin Lane Keller, et al., “Introducing and Naming New Products and Brand Extensions”, Strategic Brand Management, 3rd Edition, Pearson Education, Inc., 2011
  • • Leon G. Schiffman, et al., “Consumer Perception”, Consumer Behavior,10th Edition, Pearson Education, Inc., 2010
  • • Philip Kotler, et al., “Setting Product Strategy”, Marketing Management A South Asian Perspective,14th Edition, Pearson Education, Inc., 2013
  • • ET Cases Case Suite with Vidur Gupta, Managing Director-Gouri’s

 

Mandatory Viewing

The students/participants must watch the following ET Cases’ case suites to help connect with the case’s expected learning:

  • • ET Cases’ Case Suite with Vidur Gupta, Co-Founder and CEO, Gouri’s, “Gouri’s Cereals: The Packaging Dilemma for the Challenger Brand – 4P’s of Marketing”, https://www.youtube.com/watch?v=a36z1fXAo-o
  • • ET Cases’ Case Suite with Vidur Gupta, Co-Founder and CEO, Gouri’s, “Gouri’s Cereals: The Packaging Dilemma for the Challenger Brand – Brand Differentiation - Packaging”, https://www.youtube.com/watch?v=SrgLuTftLpI

 

Case Positioning and Case Setting

This case study can be used for either of the following

  • • MBA Program – Brand Management course – “Choosing Brand Elements to Build Brand Equity” Chapter – To understand the guidelines for creating high-impact packaging
  • • MBA Program – Brand Management course – “Measuring Sources of Brand Equity” Chapter – To access the visibility of packaging and brand awareness using Brand Asset Valuator (BAV) model
  • • MBA Program – Brand Management course – “Introducing and Naming New Products and Brand Extensions” Chapter - To evaluate brand extensions by evaluating brand elements such as packaging and labelling
  • • MBA Program – Consumer Behavior course – “Consumer Perception” Chapter – To understand the importance of packaging as a positioning element
  • • MBA Program – Marketing Management course – “Setting Product Strategy” Chapter – To understand how companies use packaging and labelling as marketing tools

 

Assignment Questions

I. Discuss the changing landscape of the Indian Breakfast Cereal Market and elucidate on the consumer’s paradigm shift-breaking the traditional breakfast habits and turning towards the healthconscious segment.
II...............

Preamble to this Case Study Analysis

This case study is meant to introduce the participants/students to the idea of how brands can build brand equity leveraging on packaging as a tool of positioning element. Although this case study highlights the entry of brand Gouri’s, its vision to build a niche cereals and energy bars brand in India by reaching out to the customers and building on the personal relationship edifice, the participants should be directed towards how companies use packaging and labelling as effective marketing tools..........

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Product code: BM-1-0017, BM-1-0017A

Abstract

This case study is meant to discuss and debate on the need to create a challenger brand in an entrenched category, Cereals. With competition from the likes of Nestle, Kellogg’s, ITC, Patanjali etc., Gouri’s Co-Founder and CEO, Vidur Gupta (Vidur) is keen to build a niche cereals and bars brand in India by reaching out to the customers and building on the relationship edifice. With a goal to achieve INR100 crore by 2020, the plans are in place to create a top-of-the-recall brand in the category with its packaging practices. With no deep pockets to splurge on marketing blitzkrieg and with a keen focus on building a ‘differentiated’ brand through natural ingredients, can Vidur’s plan to scale up a neighborhood hobby into a sizeable business and make a challenger brand, fructify? What are the specific yet cost-effective branding initiatives that he should opt for? Given the premium nature of the product, would there be enough takers? How many multiples of existing customer base of 4500 are required to shore up the scale?

 

Pedagogical Objectives

  • To have an overview and understand the changing landscape of the Indian Breakfast Cereal market, breaking the traditional breakfast habits and turning towards the health conscious segment
  • To understand the product differentiation for a fledgling brand like Gouri’s, given the resource constraints and the nature of competition and to discuss the key brand elements (including the brand promise, the brand perception, brand expectations, brand persona, logo etc.) that can establish Gouri’s as a formidable brand in cereals and bars category
  • To examine how Gouri’s differentiated itself with its packaging decisions and to discuss the most suitable branding and packaging strategy for Gouri’s using Brand Asset Valuator (BAV) model

Case Positioning and Case Setting

This case study can be used in MBA program for either of the following courses:

Course Chapter Purpose/Learning
Brand
Management
Choosing Brand Elements
to Build Brand Equity
To understand the guidelines for creating
high-impact packaging
Measuring Sources of
Brand Equity
To access the visibility of packaging and
brand awareness using Brand Asset
Valuator (BAV) model
Introducing and Naming
New Products and Brand
Extensions
To evaluate brand extensions by
evaluating brand elements such as
packaging and labelling
Consumer
Behavior
Consumer Perception To understand the importance of
packaging as a positioning element
Marketing
Management
Setting Product Strategy To understand how companies use
packaging and labelling as marketing tools

 



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