The company plans to double its total marketing spending in the country in the next couple of years, Salil Murthy, managing director, Mars Petcare India shared in an exclusive interview…
India is an important growth market for global pet nutrition and healthcare company Mars Petcare, known for its brands Pedigree and Whiskas.
The company, which controlled over half of the country’s market share in 2020, even launched a vegetarian line exclusively for its furry consumers here.
So important is India for the company that it increased its investment in the country by 500% in 2021. Although the company declined to share investment details, media reports of 2021 mention an announcement by Mars Petcare about investing Rs500 crore towards expanding its pet food factory in Telangana to meet domestic demand and exports to other Asian markets.
Since 2002, when Mars entered India with Pedigree, till January 2023, it has invested over $200 million in its India operations, as per media reports.
The company is present in 130 countries and has been in the pet nutrition and care business for the last 80 years. It has touched the lives of 400 million pets, half the world’s pet population.
The brand has played a crucial role in building the pet nutrition category in the sub-continent. Its efforts have led to industry growth of 16% in 2019 and over 20% in 2020, its former India MD Ganesh Ramani was quoted saying in media.
It had set up a factory here in 2008, back when branded dog food was not even a market. In 2021, its pet care business gained market share and outpaced the category growth of 35% to 40%, Ramani shared in another interview.
Today, the company has five factories (one each in Baddi, Bengaluru, and Hyderabad and two in Pune) catering to the growing demand for dry pet food. It imports parts of its wet food from Thailand.
To ensure that its products are suitable for the Indian market, the company has a panel of pets—expert dogs and cats—that checks the taste and palatability.
In India, the company offers an entire portfolio which straddles different price partitions and benefit partitions. For instance, Sheba for cats and Cesar for dogs are gourmet brands while Chappi for dogs and the newly launched Kitekat are entry-level brands, IAMS is a science-backed product for dogs as well as cats and Temptations is a treats brand.
Although Pedigree and Whiskas are category leaders in the country, there’s still a lot to be done in terms of expanding the category and educating pet parents about the right nutrition, Salil Murthy, Managing Director, at Mars Petcare India told India Retailing in an exclusive interview. Edited excerpts…
Mars is present across the globe. How important is India for Mars on a global scale?
India is among the top five priority markets for Mars. And it’s among the top 10 in terms of revenue. Our big markets continue to be where the category is much more penetrated—90% or 95% like in the US or the UK.
But India is significant because you have got the demographics the GDP, which continues to grow and several other macro factors. Also, because of the size of the opportunity.
How big is the India opportunity for this category?
The current pet nutrition market is estimated to be around $800 million as per independent estimates. And it has the likelihood of growing to between $1.8 and $2 billion by 2030, which translates to a Compound Annual Growth Rate (CAGR) of 16%-17%.
I have been doing FMCG for 22 years and there are not many categories which continue to grow at this rate for six, or seven years in a row. That is where the potential of the market is.
What would be your focus to make the most of the opportunity?
Our focus continues to be on nutrition and growing the category in the country.
Part of the reason is the category evolution relative to other countries, not just the US, and the UK, but many other emerging markets—the category is significantly underdeveloped in India in terms of household penetration, the number of dogs and cats getting the tailored nutrition that they need and per pet consumption, although there are 31 million dogs and cats in India.
So, in a way, you are helping build the category.
It’s more like growing the category which is going beyond the basics of getting high-quality products and trusted, reputed brands. To grow the category, we need to do more—create awareness about giving the right tailored nutrition to pets as per breed, age, and lifestyle. We need to build the entire ecosystem, which includes veterinarians (vets), retail partners, supply chains and non-governmental organisations (NGOs) among others.
It has to be in a way that is meaningful and positive for the overall industry.
How are you expanding the category?
We are getting deeper into each segment. For example, we have food for puppies and adult pets, and among adults, there are small and large breeds.
Then you get into functional benefits like products for skin and coat and high protein variants. Furthermore, we have a vegetarian variant for Pedigree in India, which we do not have anywhere else in the world.
How has the response to the vegetarian variant been?
It’s doing well, partly driven by the big trend of humanization. If you think about the macro trends that are driving this category, it’s humanization and real ingredients. If I eat vegetarian, I would like to feed my pet the same. However, we ensure that pets get the specific nutrients they need.
What is your channel mix?
It is decently distributed across vets, pet stores and modern trade.
The other piece is e-commerce, especially quick commerce, which is one of our fastest-growing channels. More than 20% of our revenue comes from marketplaces and e-commerce, 12% comes from Q-commerce, and 10%-20% comes from modern trade. The balance comes from general trade.
But we’re seeing growth in modern retail—pharmacy, quick commerce, and pet stores.
Which brands or which food category is doing the best?
Some of our gravy, treats and premium brands like Sheba are doing well. Pedigree has a premium range called Pedigree Pro, which is doing nicely.
Are the sales picking up beyond metros as well?
For quite a few years, we have been seeing some of the smaller towns growing faster than the bigger towns.
The signal that we are getting is that there is a lot of untapped demand that exists across the spectrum.
So how are you catering to those markets?
We have our distribution, our salesforce, and a network of distributors, some of whom have been partnering with us for a long time. We are expanding our store footprint as well.
It is not dramatically different from FMCG. If I am a pet parent feeding Pedigree to my dog, I expect it to be part of my monthly shopping basket because my dog is eating Pedigree twice a day, every day.
So, as I go for my monthly purchase, Pedigree should be present right there.
Are you doing anything to make it more visible in stores?
We have specific category shelving norms. We are working with our retail partners to ensure that we have the right level of displays within stores.
Large format stores usually have an aisle or part of an aisle dedicated to pet care. We work with retailers to create the right planographic principles because we have a lot of experience globally where we work with the likes of Walmart.
What are some of the key global learnings that you have adopted in India?
One is treats bring in a lot of customers into the aisle. We use this insight globally. Consumers are excited about the new treat they can give their dogs; it drives a lot of main meal purchases as well.
The other thing is, sampling a wet food pouch with dry food.
What is your marketing budget?
We don’t break out our marketing budget. But I can tell you this, we are looking to almost double our total marketing spend over the next couple of years in India.
The focus will be on continuing to grow our global mega-brands Pedigree, Whiskas, Sheba, and IAMS—which are $5 billion global brands.
Although Pedigree and Whiskas are market leaders, there’s a lot more to be done in terms of brand building, messaging, and communication.
Where will the spending be?
We are spending a lot on digital marketing (search, content, programmatic buying, display videos—the entire Martech/ad tech stack) to reach the right audiences, the right segmentation and drive personalization.
As we continue to bring new and innovative products, fuelling education and awareness around them becomes critical. That’s primarily where we’re looking to grow.
For that, we are also building capability, both by increasing the size of the marketing team, and increasing their capability to be digital first—because there has been a rise of OTT platforms, retailer media, and social commerce—these are new skills that marketers need.
Influencer marketing is big now. How does it work for your business?
Pet stores are critical influencers, especially at the start of a pet parent’s journey. As many as 70% of Indians are first-time pet parents and they often seek advice from the pet stores.
There’s a big gap in terms of knowing how to care for a pet. When faced with problems like a pet not eating, or behaving differently, new pet parents often reach out to vets, friends or family, Google, and community groups.
So, we engage with all these groups to drive the education. Our pedigree website too has the three big Cs—content, communities, and commerce.
It has frequently asked questions (FAQs) by experts, and AI tools where pet parents can upload pictures of their pets, identify the breed, and life stage, and get personalised recommendations.
How else do you use technology?
Historically, we have used technology primarily in the supply chain—route to market, salesforce automation, distributor management system, monitoring truckloads… and manufacturing.
Now, we are increasingly doing it from a demand standpoint to figure out the consumer signals across paid, owned and earned media.
We are also using technology for data privacy, driving personalisation and targeted messaging. We use things like dynamic content optimization and marketing automation tools for identity resolution.
Do you use generative AI?
We are using GenAI primarily for some content. Our website has a GenAI-based chatbot, which provides customers with the answers they seek or directs them to specific resources that can help them find what they are looking for.
Is there a goal or target you have set for Mars Petcare in India for the next few years?
The goal that I have set for my organisation is we need to be pet parent-centric. We have fantastic brands, great people, great processes and systems and as long as we put parents at the centre, we won’t go wrong. Then the growth will come, helping us unlock the opportunity.
Also, big companies can get quite internally focused. What I’m trying to do is solve a problem that’s out there. For example, I visit a pet parents’ home during my monthly market visits. I play with their pets, understand their pain points, likes and dislikes…and I walk away with a new learning every single time.
