Brands: Power Of Yogurt
When your NEW snack brand starts selling more than 4 million units a month in less than two years of its launch even as it lacks the marketing and distribution might of a large multi-national FMCG company, you know for sure that the product and the brand is a success. And this success seems even more remarkable when you consider that the product is perishable with an extremely short shelf-life.
The subject of our attention is Epigamia Greek Yogurt that has, in less than three years, carved a niche for itself in an otherwise highly competitive and capital-intensive dairy foods category dominated by the likes of Nestle, Amul, ITC and hundreds of regional and local brands. The smooth and delicious Epigamia Greek yogurts have already become a household name in metros and other bigger cities.
With each passing quarter, the brand is growing deeper and wider, Rohit Mirchandani, CEO and co-founder of Drums Food International, the company behind Epigamia, tells BW Businessworld.
Epigamia was in news recently for attracting a clutch of investors including leading business families and Bollywood personalities like Kunal Kapoor and Deepika Padukone.
So what explains the rise and growth of brand Epigamia? How did it get where it is today? What lessons does it hold for other startups?
Genesis & Journey
Much before the birth of Epigamia, Drums Food International had made a name for itself by manufacturing and selling the Hokey Pokey ice cream, a brand still available in major metros. Why Epigamia then?
“In addition to running our ice cream business, we wanted to launch a health and lifestyle product for daily consumption. Being activists of taste and advocates of health, we were very clear that this product needs to be superior in taste and score high on health parameters,” says Mirchandani in a mild American accent, sitting across small table in an otherwise noisy restaurant in a five-star hotel in New Delhi.
Having grown up in the United States, Mumbai-Mirchandani led a successful career in finance with S&P Corporate Valuation Group (now a division of Duff & Phelps Investment Bank). He moved to Mumbai only in 2013.
“I came back to join the family business of logistics and supply-chain based solutions, a critical experience that has come in handy for both ice cream and Epigamia business,” says Mirchandani, who holds a Bachelor’s degree in Finance and International Business from NYU’s Stern School of Business and an MBA from Wharton.
“Our ice cream experience helped us unlock taste preferences and we were confident of cracking the same for Epigamia,” he adds as he orders an energy drink to stay alert and focused. “I haven’t had much sleep as I have been moving around and meeting people since I landed here.”
Epigamia Greek Yogurt, the first product from Drums Food, was launched in June 2015 and was positioned as a ‘fresh’ with ‘no preservatives’ and ‘superior tasting’ product. “We received immediate traction and keen consumer interest. But the initial days were about canvassing a large number of retail stores to convince them to stock
Epigamia,” recalls Mirchandani.
Among the biggest challenges during the early phase was how to manage the short shelf-life of the products, he adds. To overcome the challenge of distribution to stores Drum Foods went on to invest in its own cold chain across the top five cities. Over the last few years, the company has built cold chain capabilities backed by dedicated cold rooms and reefer trucks. These are enabled by data system infrastructure for intelligent planning. Currently, Drum Foods services over 6,000 stores across the top five metros and delivers fresh stock regularly.
Products under the Epigamia brand are currently being manufactured at three state-of-the-art manufacturing facilities — two in the west and one in north India. “We intend to establish a facility in the south very soon,” says Mirchandani.
The primary distribution transports products from factories to the warehouses which then push products to 13 major cities across India. “Currently, we are present in 13 cities and are planning to expand into 25 cities in the next two years,” says Mirchandani.
Positioning & Investor’s Interest
Epigamia Greek Yogurt appeals to a diverse set of consumers, from the millennial first jobber and the fitness enthusiast to teens and children. They all find Epigamia to be a no-compromise solution to ‘health and taste’ aspect, says Mirchandani, adding that his products are being consumed as a ‘mid-meal snack’ that is ‘tasty’ and ‘healthy’.
“Keeping in mind the protein content of our yogurts, there are many who consume them as a pre- or post-workout snack. The good thing is that consumers who never had yogurt in their consumption basket are now consuming this daily,” says Mirchandani.
It is, therefore, hardly surprising that a clutch of marquee investors have pumped a total of around Rs 320 crore or so into Epigamia. Bollywood actor Kunal Kapoor was part of Series A funding, while actress Deepika Padukone besides entering into a multi-crore strategic partnership with Epigamia joined a clutch of investors as part of extended Series C funding.
The Series C funding saw a new investor in Danone Manifesto Ventures, the venture investment arm of one of the world’s leading food and beverage companies Danone. This round also saw participation from existing investor DSG Consumer Partners (DSGCP), Samina Vaziralli, Executive Vice Chairperson of Cipla, and venture debt participation from InnoVen Capital, India’s largest venture debt provider backed by Temasek Holdings.
Brand & Learnings
“Epigamia is a classic case of marketing done right,” says brand strategy specialist Harish Bijoor. “The brand has for itself a hard working product, great packaging and a brand endorser (Deepika) with her skin in the game,” he adds.
On terming it a byproduct of curd having done well, Bijoor has an explanation. “If you call Epigamia a curd, I am sure the brand folk out there would baulk. However, the point to remember is the fact that smart marketing can make a smart product, and more importantly a smart brand. Epigamia is an example.”
On the role of serving size and packaging making a difference in the positioning, Bijoor compares it to Yakult and its success. “Serving size is important. And that learning has come from Yakult and its success in small size decantation. Consumers who partake brands such as Epigamia are not volume eaters. They are value eaters. Small is beautiful here. Bite size is big size,” adds Bijoor.
What about learnings for startups looking to enter the food and snacking business? “Yes there are many lessons indeed,” says Bijoor whose private label consulting has spread across continents and in diverse fields.
“Stay niche for a start if you are looking at value,” says Bijoor. “Build depth into that category and then think width” is another precious takeaway from the success of Epigamia. And last but not the least, “Associate high quality in every step you take, starting from brand-endorser name to product to packaging and more,” says Bijoor.
More power to Epigamia and other home-grown brands that are out there or still on the drawing boards, waiting for their journey to begin.
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