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What Happened to Ruchi Banana Chips?

Potato crackers are one of the most popular snack items in Bangladesh. The success of Bombay Sweets’ Potato Crackers has led to the arrival of new players in the Potato Crackers and Chips segment of the country, who have been following Bombay Sweets in taste and packaging. At that time, due to the TV commercials, the potato crackers that came in the market after 2000 were able to gain more popularity in the country. Square launched Ruchi Banana Chips to introduce consumers to a chip of entirely different flavors in such a market. Even though earlier, Akij Food & Beverage introduced sweet-tasting Chiki Monkey Banana Chips, but the product was not very successful. Like Chiki Monkey Ruchi, banana chips were a healthier option than potato crackers but did not gain much popularity in the market. So at one time, the company stopped the production of these chips. But why did Ruchi Banana Chips get lost?

Overview of Ruchi Banana Chips

Square Group started its journey with Mr. Samson H Chowdhury in 1952 through a small pharmacy store in Atikula village, Pabna. In 1958, Samson H Chowdhury founded a pharmaceutical company in a joint venture with his three friends Kazi Harunur Rashid, PK Saha, and Radhabind Roy. Over the next few decades, under the strong leadership of Mr. Samson H Chowdhury, Square expanded its business into segments such as Healthcare, Food & Beverages, Cosmetics & Toiletries, Textile, Apparel, Media, IT, and Security.

In 1952, Mr. Samson H Chowdhury started his journey with Square Group as a small pharmacy store in Atikula village, Pabna.

Square Consumer Products Limited started its journey in 2000 as a subsidiary of Square Group. Under this company, Randhuni and Ruchi, one of the most popular consumer product brands in Bangladesh, was launched in 2001. The company sells a variety of cooking spices, ready mixes, and edible oils under the Cooking brand. On the other hand, under the Ruchi brand, the company sells various snacks items such as chanachur, muri, ketchup, chips, chutney-pickle, jam-jelly, etc. Over time, the company has added Sugar Rice brand Chashi; Noodles brand Chopstick, and Beverage brand Aram to its product line.

Since its inception, Square Consumer Products Limited has focused on product quality, branding, and packaging. That’s why they have limited their product line. At that time, most of the snack producers in Bangladesh followed the leading brand with similar products in the market. Still, Square focused on launching different flavored products in the snacks market of Bangladesh. Ruchi was the first to introduce different flavor Jhal chanachur in the Bangladeshi market. Although Bombay Sweets or Pran’s Chanachur were the most popular in the market. The Chanachurs of other brands available in the market was also very close to Bombay Sweets or Pran Chanachurs in taste. After the success of Jhal Chanachur, Ruchi also brought barbecue-flavored Chanachur to the market of Bangladesh for the first time. The taste of barbecue Chanachur was different from other Chanachur prevalent in the market and targeted young customers. As a result, Ruchi Chanachur can gain popularity among the customers despite being in a highly competitive market because of its quality and different tastes.

Following this, Ruchi introduced Banana Chips in the Bangladesh chips market. However, although few consumers initially adopted these chips of different tastes,but the product never gained popularity in the market and after a time, it was lost from the market.

Currently, Bangladesh has an annual market of Crackers and Chips worth BDT 650 crore. Which is dominated by Bombay Sweets with 50 % share followed by Pran foods owning 20% of the industry. On the other hand, the chips segment is dominated by Sun Chips of Quasem Food Products Limited.

The current annual market of Crackers and Chips in Bangladesh is worth BDT 650 crore.

Why Failed?

Lack of Customer Acceptance

When the Ruchi Banana Chips were introduced in the Bangladesh market, the most popular chips in Bangladesh at the time was Bombay Sweets Potato Crackers. Apart from Bombay Sweets, several other Potato Crackers were available in the market at that time. Other popular chips at the time, besides potato crackers, were Ring Chips, Mr. Twist, Crispy Curl Chips, Meridian Chips, and more. Although Ruchi Banana Chips has done a lot of product research, it has brought healthy chips of different tastes to the market from all the types of chips prevalent in Bangladesh at that time, but customers initially purchased Ruchi Banana Chips as a new product, but the maximum customer did not repeat purchase. As a result, gradually only a very small consumer group regularly bought these chips. Although banana chips are a very popular and widely available product internationally, consumers in Bangladesh are more accustomed to chips with crackers or potato chips with salty and spicy flavors.

As a result, chips of other flavors are rarely seen in the market. Consumers in Bangladesh usually consider bananas as fruits or vegetables, so most of the customers could not accept banana as a chips. Although many importers are importing chips of different flavors of different international brands, it is a very small part of the market. Consumers in Bangladesh also have less adaptability to any product with a different taste than the conventional ones. Although there are several types of flavors of Sprite and Fanta worldwide, consumers in Bangladesh have not yet adopted any other flavor other than basic flavor. When it comes to juice, most consumers usually understand mango juice. Whereas apple and orange juice are among the most popular juices in the world.

In 2006,when Akij Foods launched the first ever Chiki Monkey Banana Chips, customers did not accept it and because of which it lost from the market. On the other hand, the flavored banana chips, tasted a bit salty, and lightly spicy. This difference in taste could not be accepted by the consumers of Bangladesh.

Wrong Targeting & Positioning

Ruchi Banana Chips is mainly positioned through TVC and print ads. But Square released only one TVC in the lifetime of the product. In that TVC, it basically shows that when a child goes to the store and asks for chips, the shopkeeper gives him a simple cracker. But then the child mother appears wearing an apron handed out banana chips instead of unhealthy crackers. The tagline was ‘Healthy Food Always Good’ with which Ruchi wanted to position the chips as a healthy snack.

Ruchi wanted parents to buy banana chips for their children as healthy snacks instead of crackers. In other words, the target consumer was mainly children. However, there was no element in the advertisement of Ruchi Banana Chips that attracted children. Because at that time other crackers and chips brand in the market used play-full cartoon characters and appling jingles which attracted more children. The Advertisement of Ruchi Banana Chips was originally targeted at parents. But at the time, consumers could not relate the issue of healthy food to snacks. In addition, when buying chips, parents usually gave priority to the wishes of the children and in many cases it was seen that the children would buy the chips of their choice.

That is, the advertisement was not relevant to the way Ruchi wanted to position their product. Here Square could target young or slightly older customers without targeting children as a consumer of healthy food.

Growing Competitors

When Ruchi Banana Chips was introduced in the snacks market in Bangladesh, Bombay Sweets’ successful product Potato Crackers and Ring Chips led the market as well as other local brands such as Cheese Ball, Mr. Twist and Meridian. In addition to these local brands, imports of international brands such as Lays, Pringles, Doritos, Kurkure continue to increase. Due to the different taste and quality of the chips of these international brands, people start adopting international chips as well as domestic chips.

As a result, domestic manufacturers, started to market potato chips like international brands. Therefore, Sun Chips of Quasem Food Products and Alooz brands of Bombay Sweets gained popularity in the market competition. Besides, the price of Ruchi Banana Chips was set at BDT 10 like other chips in the market and contained 20 grams of chips in the packet. As bananas are a bit heavier than the potatoes in weight, and the packet size was smaller than the packets of other chips, the perception of the customers was that the amount of chips in the packet of Ruchi Banana chips was less.

Every 20 grams of Ruchi Banana chips cost BDT 10.

Lack of Promotion

Ruchi released just one ad with the tagline ‘Healthy Food Always Good’ for Ruchi’s banana chips. Other competitors, on the other hand, carry lots of promotional activity for their chips brand throughout the year, such as TVCs and gifts. As a result, even those who were health conscious consumers at the time did not know much about this product. As a result, no such demand was generated in the market around the product.

Lack of Availibility

Due to a lack of adequate demand, retailers did not keep the product in their shops despite square having a strong distribution channel. It is often seen that customers go to the store and buy the product, even if it is to taste a new chip. But due to lack of adequate demand, banana chips could not be found in most of the shops in rural or district towns. Ruchi Banana Chips was only available in downtown stores.

Costly Raw Materials

The main ingredient in Ruchi Banana Chips was raw banana. According to a report by Ruchi’s brand manager, certain varieties of bananas were used for Ruchi banana chips, which were mainly seasonal bananas and were cultivated in certain parts of the country. As a result, they often faced various problems with sourcing and had to buy at a higher price. For the material procurement of Ruchi Banana Chips, Square should have built its own strong supply chain and cultivated bananas on its own initiative.

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