Danone to enter new product categories with Protinex

The company believes that Protinex's current powder form limits the scope of expanding the business and hence, diversification into new categories is essential for its growth.

French multinational food products company, Danone, after its exit from the dairy business last year in India, is planning to enter new product categories and formats with its flagship brand, Protinex.

While it has already extended this product into the biscuits category recently, other products in the solid and liquid spaces are under consideration which the company believes will help further sales.

The company believes that Protinex's current powder format limits the scope of expanding the business and hence, diversification into new categories is essential for its growth.

“Until the introduction of Protinex Bytes (biscuits), Protinex was available only in powder format. We have decided to get into new formats”, Himanshu Bakshi, managing director at Danone India told Business Standard.

Bakshi, however, did not specify the particular formats Danone is eyeing to enter.

“It could be in solid, as well as liquid, or new flavours”, he said.

Asked if the company is eyeing the ready-to-drink market, Bakshi said, “It is definitely a format consumers are looking at as it offers a lot of convenience. But it also requires new route to market.”

The company is of the view that venturing into new product formats will not only help increase consumption, which will open new revenue stream, but it will also help in customer retention by offering the same brand in different formats, which in turn, will assure higher sales volume as well.

“Introduction of new formats and flavours will help to grow protein category which is very nascent right now.

"Innovation will help us drive deeper penetration into existing and new households," Bakshi added.

However, owing to regulations on baby food and infant nutraceuticals, Danone is expected to limit adjacencies to the Protinex brand only.

The company, will however, try to innovate within the permissible regulations in infant nutraceuticals space and focus on more scientific formulations.

This year, Danone launched Aptamil with Prebiotics, the first infant formula with GOS FOS in India and also came up with the zer-sugar Protinex Lite.

It is working to reduce sugar by 20 per cent in its entire portfolio by the end next year.

Danone has a 13 per cent market share in the Rs. 2,300 crore infant milk formula market and Protinex has a 45 per cent market share in adult nutrition space.

The total health food and drinks market in the country is pegged at over Rs. 6,000 crore.

Available in more than 250,000 outlets abd pharmacies, Danone is trying to position the Protinex brand as a consumer friendly brand rather than a prescribed one.