More than 95 percent of the fresh meat and seafood industry in India is unorganized and usually conjures up an image of an unhygienic local market and an unpleasant buying experience.
In order to tap the significant untapped market, many new-age brands like Licious, Meatigo, Nandu’s, and FreshToHome have forayed into this industry.
“There is no control of temperature and hygiene in mandis which ultimately affects the taste and quality. Even in the best of supermarkets, there is very limited space and less focus on meats - in terms of proper handling, temperature control, and providing a good range. So there lies a great opportunity,” says Siddhant Wangdi, Founder, Meatigo.
Changing Consumer Behavior
Recently, the fresh meat and seafood industry has also seen an upsurge in demand due to work from home culture amid the pandemic. Consumers are opting for ready-to-eat food, do-it-yourself (DIY) meals, and grilled and marinated products for hassle-free cooking.
The new-age brands are delivering an unparalleled meaty experience to Indians by introducing global quality standards and benchmarks and setting up a hitherto non-existing infrastructure and processes that India was yet to see.
“We decided to start Meatigo with the objective of providing every type of meat lover with a one-stop destination via an online platform with a focus on quality and range. We realized that consumers are becoming more and more conscious about what they were eating - the same thing extended to meats - and people are looking for healthier, safer, and more convenient products. Consumers are evolving in terms of tastes and are looking for meats that are beyond raw chicken, fish, and mutton,” asserts Wangdi.
The Covid-19 outbreak has triggered more consumers to shift from local butchery shops to trusted meat brands. The shift has been significant for the last two years.
“Our focus on quality and innovation has helped create a very captive audience base. We talk to our consumers all the time, be it operations-related queries or questions about how best to cook our meat or what cut is used for what dish. The fact that we can respond to our consumers very quickly, be it feedback or launch ideas has made this relationship strong,” adds Wangdi.
Omnichannel: The Way Forward
With a commitment to provide fresh and quality products, these brands are setting up their Omnichannel presence to reach more consumers.
“Licious is channel-agnostic. We have an omnichannel presence already through app and web, offline stores (known as The Licious Experience Centers), and select modern retail for some of its RTE and RTC products. We also sell products through channel partners such as Dunzo and Swiggy Instamart,” share Abhay Hanjura and Vivek Gupta, Co-founders, Licious.
Licious is further planning to significantly strengthen its offline presence during the next 3 years.
Apart from this, there has been a growing demand for hyper-local brands that can provide superior quality meat products at the doorstep.
“Nandu’s, being an omnichannel brand was quick to adapt to the new normal and ensured that our customers have access to our products seamlessly without much hassle. The direct-to-consumer segment, though has been functional for quite some time, but its importance was realized once we were in the midst of a pandemic,” says Narendra Pasuparthy, CEO & Founder, Nandu’s.
Marrying Technology with the Brand
The only way to cater to changing customer preferences and shifting market dynamics is to embrace technology disruption.
“In the highly fragmented and unorganized meat segment, Licious, is striving to bring efficiency to the sourcing and processing of produce. For instance, the last-mile engagement with the customer happens with the help of technology. Because the company interacts with the customers directly via the website or the app, the last-mile inventory management becomes more streamlined. This, essentially, eliminates the need to stock the products like retail shops, which in turn reduces its lifespan. Another angle of technology use and innovation is tracing the whole inventory, from the time it is sourced from the suppliers till the time it reaches the customer,” share Abhay Hanjura and Vivek Gupta.
Additionally, Licious has created a technological system that helps predict consumer behavior ahead of time. Based on the behavioral patterns that are collected over time, the gourmet meat startup has built several algorithms that are working to solve the problem of stocking branded, chilled meat round the clock.
Similarly, Nandu’s looks at technology as the catalyst that has helped the brand to take its products directly to the end consumer.
“Technology adoption has been our biggest facilitator in transforming from a B2B business to a B2C and ultimately a D2C business. It gave us the confidence to operate retail stores across Bengaluru as well as venture into e-commerce. Today, everything we do is seamlessly integrated into an organized system because of our robust IT ecosystem. Nandu’s state-of-the-art technology stack comprises two main elements - an operational Enterprise Resource Planning (ERP) across the enterprise to ensure 100 percent traceability and transparency and our own point of sale system, developed in-house, to capture retail operations data at the stores and on the e-commerce platform,” shares Pasuparthy.
“We are the first-ever meat retail brand in India to invest in a Mystery Audit System (MAS), which is a tech-based evaluation system to assess and monitor the quality of services provided from the point of view of the customer. We also have customer relationship management (CRM) tools to help customize our offerings in order to enhance customer experience. Smart adoption of technology helps us offer greater value and meet the expectations of new-age consumers,” he further adds.
Apart from this, there is a lot of tech dependency when it comes to temperature control monitoring right through the entire processing of all the meats.
According to Wangdi, “All our products are vacuum packed using German technology and sealed to give additional freshness while ensuring longer shelf life. Our vacuum packs are highly specialized solutions to prevent any sort of oxidation and ensure no freezer burn.”
Impact of Pandemic
When you don’t know what to expect, the challenges seem insurmountable. Especially in an unprecedented crisis like the COVID-19 pandemic that has rattled economies across the globe. However, the organized fresh meat and seafood industry has strongly stood the wrath of the pandemic and has won the battle by coming out stronger.
“The business saw a 300 percent growth during the greater part of last financial year and continues to hold on to the momentum. While all product categories saw growth, the ready-to-cook and ready-to-eat categories contributed significantly to the revenue,” Abhay Hanjura and Vivek Gupta state.
Currently, Licious delivers more than a million orders per month. The average basket size per consumer grew by 30 percent too.
The company has enjoyed a repeat purchase rate of 90 percent and continues to enjoy the same. Licious has also served 1 million+ unique customers to date.
“We have been discovered by new consumers across all the 8 cities where we deliver. We have been fortunate enough to keep our business running through the pandemic while that came with its own set of challenges. So challenging yet rewarding growth has been the flavor of the pandemic,” adds Wangdi.
How Bright is the Future?
The meat market in India is at an inflection point - given the current scenario where customer preferences have changed significantly in the last year, trusted brands with a proven track record will have an edge over other players in the market.
In fact, there are important discussions on food safety, hygiene, and quality happening across the value chain, paving the way for an evolved and organized ecosystem in India.
Given the fact that most of us have already adjusted to the new normal, the behavioral shifts are expected to be long-term and, in all likelihood, permanent in nature.
This trend is also being witnessed in the growth of convenience food in the RTC and the RTE segments. With this growing trend of healthy convenience foods, people are looking for food products that reduce the time, effort, and stress of cooking.
“The market itself is huge and is growing at a rapid pace at over 25 percent year-on-year, adoption from unorganized to organized is also happening at an accelerated rate. The meat market in India is worth $30 billion of which $2 billion is just processed foods. So, growth in this segment will be exponential,” states Wangdi.
“The D2C segment is currently the need of the hour and will only evolve to become bigger. Brands who are hesitant to evolve with the changing times will face a setback at some point and brands who are aggressively changing their business models to match the changing times will thrive,” adds Pasuparthy.