Brewing the success recipe

While the hospitality sector is growing at a fast pace, Wagh Bakri reverently heeds the crucial smaller steps needed to reach the ultimate goal. Parag Desai, marketing director of the group talks to Express Hospitality about his aim to make tea a lifestyle statement in times to come

Parag Desai Marketing director Wagh Bakri

The heat generated by the hotel sector's startling progress is acting as a motivating force for related industries too. Parag Desai, marketing director of the Wagh Bakri Group is of the view that tea drinking is poised to make a dent in the segment to claim its share among other beverages, which are growing by their sheer hold on the fast food culture. Wagh Bakri - India's third largest tea seller brand, therefore is clasping this new-found opportunity with both hands.

Grabbing cuppa of growth

While the door for the fast food sector has been left wide open for some time now, the scope of tea drinking as a popular commercial beverage, has not quite reached its potential, taking into consideration India's mass tea consumption patterns. Wagh Bakri, the company which has been stimulating people for over seven decades now is also Gujarat's most popular brand with a turnover of Rs 260 crore.

However, the scope of tea is never region-centric and therefore, the tea business - if made into a commercial proposition - can be tapped across the country. "There is immense opportunity in this sector and we are going to take refined steps to increase our presence by making tea a lifestyle product like coffee," Desai says. He feels that tea hasn't become such a commercial beverage in fast food outlets in a big way mainly because of its brew, which cannot be dispensed in the way coffee can be. "To overcome this, we have developed a tea vending machine, which we have installed at the Ahmedabad airport and railway station and are soon to install in other cities too. Interestingly, the group is taking strategic initiatives to popularise tea. First in line is the launch of several varieties of ready-to-drink iced tea packs. The company is also introducing a chain of 10 tea parlours at select places in Ahmedabad and Mumbai, known as 'Whole night tea parlours'," he informs.

At the same time, the company is also taking small steps towards a larger vision to grow in a big way. Essentially a regional player, Wagh Bakri has now stepped into the Mumbai market with a view to expanding its marketing and sales network in Maharashtra. "We are targeting a 15 per cent volume share in the first year of our launch, with aggressive branding in the Mumbai market, which accounts for 22 per cent of Maharashtra's volumes," says Desai.

On an expansion mode

Besides opening its marketing office in Mumbai, the company has taken several other initiatives to support its expansion plans. It has set up a full-fledged tea-tasting centre in Kolkata; purchased land in Nadiad to set up its new packaging plant and has also bought a state-of-the-art teabag packaging machine from Italy.

Among the new initiatives, the company has gone international, having recently entered the UAE retail market. "Our research team found that UAE consumers were tired of the popular tea brands and were looking for something new," says Desai. While explaining the difference between the preferences of European and Asian consumers, he added, "Asians like strong tea, while the Europeans prefer it light." With such aggressive branding and large-scale expansion plans, the Wagh Bakri group is poised to take the turnover to Rs 375 crore by 2010.

The company is also looking at a result-oriented approach to contribute to the growth of the country positively. It aims to be socially responsible, returning to society a share of the gains from the commercial enterprise it is involved in.