Bombay Creamery – Can Reliance repeat a Campa in ice creams?

As Reliance launched its Bombay Creamery ice creams in Western India, the big question is whether it can repeat the Campa Cola story in ice-creams too. It is a tough market, but expect Reliance to surely disrupt it.

High growth but fragmented market

Ice cream market in India is expected to grow from ₹30,000 crore in 2023 to ₹50,000 crore in 2028. Between 2011 and 2023, India’s ice-cream consumption per capita increased nearly 4-fold. But the more interesting part of the story is that it is a fragmented market. The biggest player (Amul) has a market share of just about 18%, while the second largest player (Kwality) has a market share of just 9%. Even today, the organized players only have about 55-60% of the market and the informal sector has about 40-45%. Fragmentation is what Bombay Creamery plans to capitalize on.

Getting to an interesting price point

The second important thing about Indian ice-cream market; it is still an exclusive market. To make it more of a mass market product, an interesting price point is required. That is where Reliance plans to position Bombay Creamery with ice creams in packs of ₹10, which makes it a highly affordable price point. It is a sort of price point that everyone can afford to try out. Also, with such a low price point, the chances of repeat purchases increases substantially. It is also being positioned as a premium ice-cream with an affordable price point. So, even for the aspirational ice-cream buyers, this becomes an important go-to brand. Price could really disrupt the ice-cream market.

Can Bombay Creamery repeat Campa Story?

In a short span of time, Campa under the Reliance banner has gotten close to ₹5,000 crore in sales and accounts for nearly a quarter of the FMCG business sales. Campa was based on a simple logic. First, flood the market with your strong distribution muscle. Once that is done, entice the customers with an attractive price point. Once the interest levels are built up, getting shelf space is hardly problem. Then, of course, Reliance has the deep pockets to continue to hit markets with persistent communication, advertisement, and investments in infrastructure. With its retail muscle, Reliance can afford to invest in cold chains for extensive distribution of ice-creams.

Actual playbook may be the Jio playbook

Like the Jio playbook, Bombay Creamery may look at 3 things. Keeping the price persistently affordable, hitting the base of the pyramid, and then let the network effect take over. When Jio was launched, Airtel and Idea were already established brands. As many observers point out, Jio had nostalgia value as it reminded you about post-cards. Similarly, an ice-cream at ₹10 has nostalgia value, as the price pertains to another era. Also, Bombay Creamery will hold on to the base of the pyramid, giving it the necessary scale to disrupt a fragmented market. Market share will come as retailers want to stack, what consumers want to buy. That is the playbook!