"Consumers now make choices based on occasions, not categories": Anil Viswanathan, Mondelez

A chat with the senior marketing director of Mondelez India on 'snacking adjacency' - a.k.a fusion snacks like Cadbury 5 Star Oreo and Kwality Walls' Dairy Milk Crackle ice cream.

When Covid first broke out, it impacted many aspects of our lives. It also changed the way people snack and eat foods. People who used to work at offices for long hours were now homebound with their families - sharing food, snacks and time with them.

This was the time we saw an evolution of sorts in the snacking segment. Mondelez, the company behind brands like Dairy Milk, Oreo, Five Star, Bournvita etc, took the opportunity to introduce new products that were a cross between existing products. It also made inroads into new segments where it did not have much of a presence before.

This concept is what the company deems as 'snacking adjacency'. The term first appeared in the company's financial results report. The term refers to the coming together of different snack foods with a combined flavour and new names and packaging.

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Over a video call, Anil Viswanathan, Senior Director – Marketing, Mondelez India tells us that the broader snacking category had gained salience before Covid and the pandemic accelerated that phenomenon.

"Snacking is a growing trend in the food industry. This is because of urban lifestyles, time compression, the broader conversation around fewer, shorter meals, etc," he says. He adds that Covid renewed focus on core categories for the company.

Talking about consumer psyche, he says "Consumers now make choices based on occasions not on categories. The choices depend on the time of the day, who they are with and the context of the occasion. At night I might be watching TV and want a small bite-size snack which goes with the TV viewing. In the morning I might be looking for a snack which serves as a refresher."

"Then we choose interchangeably between categories. Whether it’s ice cream or breakfast cereals or milkshakes or anything else, chocolate is a dominant flavour that consumers choose. Products with Five Star, Perk, Gems, Drinking Chocolate are all extensions of the dairy milk flavour," he elaborates.

He explains that consumers desire novelty - this includes novelty of texture, flavours and overall experiences. "When we brought silk and Oreo together to create a Cadbury Silk Oreo, we were attempting to give the consumers an interesting experience. Similarly we also have products like a Cadbury Fuse and Five-Star with Oreo flavour. Consumers know five star and they know Oreo - when we bring the two products together there will be curiosity about what the new product tastes like," he explains.

"We also identified spaces beyond our core, that we weren’t participating in, but where there was a lot of consumer interest. We realised we had to focus on this area as well, to continue to grow in the snacking segment. This is what we started calling snacking adjacency," says Viswanathan.

He explains that Mondelez India‘s focus is on categories which are adjacent to the company's pre-existing core categories. He breaks down the core idea behind snacking adjacency - "In some categories we don’t have the technical know-how or the capabilities to enter but our brands can play a role there. In India we have entered some categories with our existing brands and globally we have acquired some new companies."

He uses ice cream as an example - "We know that there is an opportunity to bring our brand in but we can’t enter the category ourselves, so we entered into a partnership with Unilever. We wanted to make sure that the flavour of our products prevails in this category." The partnership here that Vishwanath is referring to is the Kwality Walls Dairy Milk Crackle flavoured ice cream.

He adds that after, Covid there's been an explosion in interest around recipes and the company is all set to launch a recipe range of cooking chocolate, chips melts etc.

A Mondelez India product that has seen success is Cadbury's Oreo - it's also a product that most cateogories pick an adjacency to. Viswanathan attributes this to the flavour of the product - it has dark chocolate as well as a few salty notes.

"It’s very popular in the US, and its flavour transcends into a lot of different desserts. When we first launched Oreo in India, we were taken aback by the number of people who were already familiar with the brand," recalls Viswanathan.

"When you look at the presence of Oreo in the ice cream category, we ensure that the predominance is given to the Oreo flavour, not the ice cream itself. It has to be the brand and the brand message that the consumer sees. That’s why it become so important to emphasise on the Dairy Milk brand."

He takes a minute to describe Oreo's advertising in India. He points out that most of the ads address the fathers of the household. Normally, most biscuit ads address the woman of the household.

Marketing challenges in a post Covid world

Vishwanathan tells us that the consumer's mindset has shifted. "Children used to pester their parents at supermarkets to buy them products. Now, kids don't accompany their parents. All the categories the kids used to pester for have seen a decline," he says.

"Earlier when kids just come back from home from school, they would stop at the shops near the schools on the way home. Now schooling has moved online and that purchase avenue is no longer available," he adds.

Discoverability is very different with virtual shopping. "We had to create and build knowledge of the entire consumer journey. We need to access analytics, data, partnerships in a way that helps us identify which stage of the journey the consumer is on."

He adds that the company is trying to build its own ecosystem in which it has a direct relationship with consumers, so that it doesn't rely on a third party platform or market place.

Sampling of new products has also changed due to Covid. "Instead of partnering with a modern trade chain, we are partnering with an e-commerce chain and we are trying to sample through them. We are also partnering with start-ups who create curation boxes and we are trying to work on media partnerships - including print and multimedia partnerships, in addition to offline touch points," he concludes.