The health driven change in eating habits has extended the window of opportunity for manufacturers to roll out a variety of oat-based products in the market. Despite the introduction of several oat-based products, oats as a breakfast cereal continues to be the most popular and preferred. “There is no doubt that there has been a sharp rise in consumption of oats, but it is largely in the form of breakfast cereals and the new easy-to-cook savoury oats. In comparison, other oat-based products are moving slowly. Instant savoury oats are performing better than sweet oats, as there are a host of sweet breakfast cereal alternatives,” points out Sunil Sanklecha, Founder and Managing Partner, Nuts ‘n’ Spices.
According to a report by Nielsen titled ‘Oats are making waves at the breakfast table’, the Indian breakfast cereal market has soared by 38 percent during 2012-2013, and oats constitute 26 percent of the Rs 720 crore (USD120 mn) breakfast cereal market. According to it, the most popular form of oats is as porridge with milk; housewives have also tried including oats with upma, idli, roti and dosa, and in Kerala, nearly 49 percent of families consume oats for dinner, but overall, consumption across India is relatively low at 13 percent. Consumers in south India were early adopters of oats; penetration rates in Chennai and Cochin stand at 37 percent and 34 percent, respectively. Says Sanklecha, “Actually, south Indians are rice eaters; oats offer them an option to replace rice, atleast in one of their meals.”
Easy-to-cook/instant savoury oats score high on taste as well. Kocheri informs that Marico introduced Saffola salty oats with local flavours such as masala, curry and pepper, masala and coriander, pepper and spice, peppy tomato and veggie twist, all of which have been very successful. Quaker Oats, the number one oats brand in India, was quick to follow this trend; in 2012, it too launched localised and popular Indian flavours such as kesar, kishmish, masala and lemony veggie mix with real capsicum. In the same year, Kellogg India introduced green pudina and tomato salsa. According to Kocheri, the coming months will see companies launching more flavours, but in smaller packs, to attract trials.
At retail shelves, domestic brands vie for space along with international brands. Products that have enhanced their nutritive value with oats, have opened up the market for more players and more innovations in this still unexplored segment.
“We are seeing a lot of international and domestic manufacturers offering value-added oat products. Britannia’s Nutrichoice Oats biscuits and Indo Nissin’s oat noodles introduced in 2011 are two instances. But such products are not very competitively or aggressively positioned. There is enough space for new manufacturers and new launches. Popular products such as biscuits and noodles containing oats will make consumers more open to trying out oats since they would come with assured taste and flavour, and be healthy too. The oats market is currently under-penetrated, and new entrants and new launches will only help it grow,” observes Ina Dawer, Research Analyst at Euromonitor International.
Modern trade is responsible for most new product launches, especially when trials and samplings are conducted by the brand. But their presence in traditional retail is no less indispensable considering the countrywide network of the unorganised segment of food and grocery retailers.
Dawer says, “Oats are sold through independent small grocers and modern retail outlets including hypermarkets and supermarkets. However, modern retail’s contribution is growing at a rapid pace; as of 2013, it contributed close to 44 percent of total breakfast cereals sales in India. Modern formats give appropriate shelf space and good visibility to such products, and here, consumers have the space to check out the ingredients and labelling on the packages at leisure so they can make informed purchases. ”
Oats are definitely here to stay provided manufacturers and marketers position the grain more strongly through marketing and through more innovations in the category, which offers an unbeatable combination of health, taste and convenience, and which needs to be brought to the attention of consumers. Nielsen’s report suggests that marketers need to innovate and educate consumers about using oats for different recipes that can cater to a wider base, and amplify the health benefits to propel the category forward.
