Low calorie sweetener Sugar Free extends brand to premium dark chocolate; will health freaks take a bite?

In its first brand extension since 1988, Zydus Wellness' Sugar Free has entered the chocolate category. A chat with its CEO Tarun Arora.

When one thinks of Sugar Free, what usually comes to mind, at least for yours truly, are the tiny white tablets being dropped into cups of tea or chef Sanjeev Kapoor touting its benefits in ads. A leading sugar substitute, Sugar Free is a brand of Indian consumer goods company Zydus Wellness.

“Sanjeev Kapoor has been associated with the brand for a decade, and all his work and focus has been on the culinary space with us…,” says Tarun Arora, CEO, Zydus Wellness.

It (Sugar Free) is not just pills for someone who wants to cut calories… “The best way to consume Sugar Free is to take the most indulgent of desserts and cut the calories straight away…,” mentions Arora.

We (afaqs!) spoke to Arora about D’lite, the dark chocolate brand from Sugar Free, which “has no added sugar and is naturally sweetened.”

The Sugar Free D’lite dark chocolates are available in four variants – Dark Rich Cocoa, Dark Zesty Orange, Dark Hazelnut with Roasted Almonds and Dark Crispy Quinoa with Roasted Almonds. The 40-gram pack is priced at Rs 99 and the 80 gm one costs Rs 189. A special festive range (for gifting) is available for Rs 429 and Rs 699.

Dark chocolate plays a significant role, that of a driver, in the Indian chocolate market which, as per TechSci Research, is expected to “grow at a CAGR of over 16 per cent to reach $3.3 billion by 2023.”

D’lite, which is pegged as a premium dark chocolate, will not only take on the likes of Amul Dark Chocolate and Cadbury Bournville, but also premium (international) brands like Lindt and Toblerone. Some of them offer sugar-free and 'lesser sugar' options.

According to Sugar Free, D’lite chocolates have a minimum of 50 per cent cocoa, and will be a digital-first brand; available across all the key e-commerce portals like Amazon, Flipkart, BigBasket and Grofers.

“We’re not a chocolate company… but we’ve got a range of exciting products in the dark chocolate space…,” says Arora.

We posed a few questions to Arora and this is what he had to say.

Edited excerpts:

Chocolate is a capital-intensive business. From sourcing ingredients to flavours to wrapping, take us through the process.

All chocolates were made in-house, thanks to our capabilities… We have formulators in food technology who’ve been working on chocolates for a year… These chocolates were made three years ago and exported to the Middle East, where a larger portion of the market is European products… you have to be competitive with them…

We had also launched Nutralite chocolate spread. So, we have been working with chocolate for more than three years. From formulation to developing these products and production, we’ve managed to do a pretty good job.

Distribution or marketing, which one poses more of a challenge?

I think both, but distribution is a bigger challenge because dark chocolates are more temperature controlled. Experience wise, it is a connoisseur’s space… who understand and have a love for chocolates… That’s how we are playing right now and we will see how it shapes up.

Why is D’lite only available on e-commerce platforms?

E-commerce is where D’lite is likely to get better traction. We wanted to focus there (I know it’s not the best as far as temperature control goes) because it will have the kind of audience, the first movers, who will take new products faster than any other space…

The kind of audience we’re targeting are likely to be more in e-commerce. We have not taken a final decision on moving to other touchpoints, our focus is only on e-commerce right now.

How do you plan to take on established brands, like Amul and Cadbury, and even premium (international) ones like Lindt and Toblerone?

Sugar Free is a strong brand that people trust… There are lots of consumers (or their families) who know and have used it over the years. The consumers will be willing to give it a shot. I think the test of our brand will be how the consumer responds.

What will drive your future strategies?

We will market and focus on digital marketing. We are on Facebook, Instagram, Google Display Marketing (GDM) and Amazon. We should be able to use all the platforms in the digital space to reach out to the consumers, explain what this is and put forth our proposition.

What’s next in the pipeline?

Within Sugar Free and for our other brands, there are more interesting and exciting products, as we speak… Some only on e-commerce, some on e-commerce plus a couple of other channels…

To get a sharper understanding of the product, we spoke to a couple of experts and here’s their take.

Gauri Chaudhari, co-founder, Brand Innerworld, a healthcare brand consultancy (she has consulted on sugar substitute brands)

People with diabetes, or those who are calorie-conscious, need to manage their calories in a day. Today, when it comes to sweets, there are not too many options.

It has been observed that, at times, it becomes impossible for people to strictly adhere to “no sweet plan’’ or stay away from sweets forever. They land up binging on sugary sweets, which poses obvious risks to their health.

Providing a healthy option is the need of the day, particularly in festive seasons. Today stevia, a natural sweetener, offers such an option for the health-conscious (people).

Chocolates having minimal calories is a good option for the health-conscious (people). Chocolates rich in cocoa are known for heart benefits.

I think Sugar Free dark chocolate D’lite may be an option for someone who wants to satisfy a sugar craving. It’s a perfect launch, provided it has the right calorie mix and a natural sweetener.

This (Sugar Free D’lite) will be a niche product (given the price). The main competition right now would be other niche brands like Zevic, a stevia-based (plant-based sugar substitute) dark chocolate.

Jasravee K Chandra, director - brand building, research and innovation, Master Sun, the consulting brand of Adiva L Pvt. Ltd (worked with Sugar Free in her career)

Sugar Free D’lite had earlier experimented with Ready to Drink options, but the dark chocolate seems like a well thought through launch. The chocolate offering carries the Sugar Free brand promise of ‘guilt-free indulgence'. With increasing awareness about the health benefits of dark chocolate, amongst the general public at large, this combo can be an attractive proposition especially for diabetics and perhaps even pre-diabetics.

There are two key challenges for the dark chocolate brand. First how to manage the tight rope between health and indulgence, since its primarily a food additive. Second, how to differentiate itself, given that there are competitive options available in the marketplace.

Established brands like Amul and Lindt have sugar free options available online. Cadbury also has a variant of Cadbury Dairy Milk (CDM) with 30 % lesser sugar option (when compared to regular chocolate). This CDM variant emphasises on ‘no compromise on taste for calorie’.

So what are the options for Sugar Free D’lite to gain preference and appear distinctive? Could it associate itself with a distinct occasion or ritual of consumption, akin to Bournville Dark Chocolate which positioned itself as a well-earned reward?

It (Sugar Free D’lite) will have to find a unique position for itself in a competitive market with well-known brands at one end of the spectrum and artisan brands on the other (with atypical flavours and blends). Could it be an individual occasion of unwinding after a long hard day’s work?