“The product selection is very important. Don’t over-engineer.” – PC Musthafa, capturing the essence of iD’s approach towards innovation ¹.
Musthafa, an ambitious youth hailing from an impoverished background, was no stranger to dealing with lack of resources and structure. He failed in class 6 and almost dropped out of school for good, before being persuaded by his Maths teacher and parents to return². Once he returned to school, he followed his Maths teacher’s advice to focus on just one subject, taking baby steps to build his confidence back up. He later combined this confidence with a focused effort to enter the prestigious NIT Calicut for an engineering degree and eventually cracked the highly competitive CAT entrance exam and secured an MBA from IIM Bangalore.
This mindset of stripping a complex problem to its essentials, and finding innovative ways to address the challenges is something he carried over to iD as well. iD’s story is particularly fascinating because it has managed to build a well-recognized and loved brand in a highly fragmented and unorganized category by executing multiple innovations.
Size of the pie
Time-constrained urban lifestyles, increased participation of women in the workforce and the rise of double-income nuclear families- all these socio-cultural trends have led to a surge in demand for convenient and hassle-free cooking solutions. Products that allow consumers to quickly whip up a meal, without losing the quintessential ‘satisfaction’ of last-mile cooking are finding increasing acceptance in Indian kitchens.
No wonder then that the Indian “Ready To Cook” market has been growing steadily over the years at double-digit CAGR, and is projected to touch 4800 Cr by 2024 ³. But for a large part of this growth journey, it has remained unorganized and fragmented.
It is this market that Musthafa stumbled into in 2005. His cousins were running a small retail grocery store in Bangalore. One of the products sold in the grocery store was locally packaged batter for making idlys and dosas.⁴
This batter was mostly sold in loose plastic bags tied up with rubber bands. These were prepared in small home-grown enterprises and sold locally, given the perishable nature of the product. Given this scenario, quality control of the manufacturing process, health and safety checks of the water and raw materials, and standardization of taste and consistency were questionable.
Musthafa saw an interesting opportunity to build a brand in this space.
Mastering the Recipe
Realizing that there was a chance for creating a dent in this market by focusing on making fresh, consistent quality batter, Musthafa and his cousins decided to focus on idly and dosa batter.
While the traditional playbook in Ready to Cook space was about investing in R&D and preservatives to extend the product shelf life, iD chose to take the difficult path.
Promising a 100% natural batter, iD eschewed preservatives and additives from its batter, choosing to use only fresh ingredients and natural methods of manufacturing, including fermentation. On the other end of the competitive spectrum, iD differentiated itself from the unorganized players by giving itself an “iDentity” through a compelling proposition backed by a credible story and clutter-breaking brand assets.
Building up the appetite
After initial experiments with basic packaging, iD quickly upped its packaging game to marry aesthetics with functionality, thus elevating the overall consumer experience and making it an extremely important pillar in brand building.
Batter, the flagship product of iD, stands out today with a clearly distinguishable and even iconic boat-shaped pack that is focused on convenience of usage. It comes with a zip lock and a flat bottom that takes the shape of a tub when opened. This makes it easy for consumers to use, lock and store the batter for repeated use, without having to transfer the content to other containers.
This packaging philosophy consistently runs through all of iD’s subsequent packaging designs too. In fact, iD has been at the forefront of marrying product and packaging innovation while launching its new product lines.
For instance, Vada is a very popular South Indian dish, but it’s extremely hard to make properly at home. Even experienced home cooks are often unable to get the perfect round shape with the correctly sized hole in the center. iD solved this frustration by designing a special Vada batter pack. The design of the spout of this pack allowed even inexperienced users to easily create round Vadas with a perfectly round hole in the middle. The sheer novelty and elegance of this packaging innovation made it extremely viral, creating a lot of positive chatter around the ingenuity of the brand.
Another such innovation was the unique ready-to-use filter coffee decoction that iD launched in a pouch format, with a very interesting design that had an uncanny resemblance to how coffee is served and consumed in traditional homes. The coffee tumbler-shaped pouch creates a high degree of curiosity and readily renders an unmistakable category connect:
Preparing authentic filter coffee from scratch is a time-consuming process that’s also dependent on technique and tools. iD took away all that pressure from consumers, allowing even novices to quickly make filter coffee from the comfort of their kitchens. The pack has received a phenomenal consumer response and has quickly become a significant revenue contributor to overall iD portfolio.⁵
iD also launched grated coconut within the original shell, as well as Smart Sip tender coconut that provides information such as water content, pulp, sweetness and total edible quantity for each of its tender coconuts with nearly 95% accuracy. This comes as a great respite to the consumers who are generally resigned to thinking of selecting good tender coconut as a lucky draw contest.
Not only has iD led with innovation, it has also been quite astute in understanding consumers’ pain points and filling real need-gaps with its fresh and natural ready to cook products. The brand’s launch and instant success of the Porotta and Chapati range is a proof that iD really understands the pulse of its consumers.
For time starved urban households, iD’s innovations make life easier, and this drives up the relevance of the brand in their lives. Given that most of iD’s product fall in the zone of ‘daily usage’, the brand also carries a high repeat potential.
Serving the spread
“We are not just a batter company; we are a fresh food distribution company that runs on technology.”- Musthafa
The above statement seems to be the guiding principle underpinning iD’s thinking around its product offerings and distribution. iD has used the guardrails of ‘natural’ and ‘fresh’ to launch an array of products beyond the ready-to-cook category like paneer, curd, ghee and bread.
However, the lack of preservatives meant that the products have a lower shelf life with some of them needing refrigeration throughout so as to preserve their quality.
The typical FMCG distribution model, which would have resulted in two to three weeks’ lag time for the products to reach retail stores, would not have worked for iD. So the brand team created their own distribution model called DSD (Direct Store Delivery) which uses a DCS (Driver Cum Salesperson). The DCS delivers an approximate quantity of required stock daily to each store within his area of delivery.
iD also uses geotagging to ensure that the DCS made the invoice after delivery at the premises of the stores and not anywhere else. The team uses data captured daily in order to develop robust demand forecasting models since they cannot afford wastage. This forecasting system allows iD to run a nearly perfect ‘zero-inventory’ model, which is critical since their shelf life is considerably shorter than that of competition.⁶
iD continues to carry the jugaad-mindset of a nimble startup that thinks on its feet. A recent post from Musthafa revealing how the brand cracked an innovative way to distribute fresh batter to faraway markets is a great testimony to this spirit of the organization:
Trust as a tastemaker
Trust is the core of any brand and this is even more applicable to brands playing in the food space. iD took some interesting initiatives to foster trust. Even though done on a small scale, iD made sure to amplify these initiatives enough to create a highly positive word of mouth for the brand.
One such innovation that iD pioneered in India was the iD Trust Shops opened in 2016.
Basically, iD Trust Shops were unsupervised vending machines kept in residential complexes and business and IT parks. Consumers could take iD products unsupervised from the shop, with an implicit trust that they would make the payment.
A great initiative that exemplified iD’s trust in its consumers, Trust Shops generated a lot of consumer chatter and earned media for the brand.
In March 2022, iD took things a step further by announcing their “TransparenSee” campaign, wherein they live-streamed their facility making idly-dosa batter on their website and YouTube for 5 days straight. Again, a great initiative to further entrench consumers’ trust in the ‘fresh and natural’ credentials of the brand:
Garnishing it just right
“If you give the right product in the right packaging, with the right service and right merchandizing, half of marketing is done.” – Musthafa
For the longest time since inception, iD did not invest in overt communications, instead preferring to let the product do the talking.
At the same time, it is notable that almost right from the outset, Musthafa’s rags-to-riches story through entrepreneurship and innovation was covered by a lot of media outlets, brewing buzz and conversations around the brand. Musthafa’s story of rising from poverty to build a successful brand through grit, innovation and simple common sense was greatly celebrated and amplified by the media.
Even when it comes to creative communication, iD’s approach is to consistently and seamlessly blend their product USPs with heartfelt stories around food. iD campaigns leverage the insight that food can be a springboard to a multitude of emotions and both its preparation as well as its consumption can foster bonding.
iD has also used imaginative ad executions to break clutter, especially with the Filter coffee launch where they cleverly reproduced the traditional process of mixing and cooling the coffee by pouring it back and forth between two cups in their print ad.
iD’s journey so far has been great. Starting from its modest beginnings as a batter brand, the brand today has a wide portfolio of products and clocked a revenue of 412 Cr. in FY22. The unique distribution model of the brand came in handy for the brand during the pandemic and it experienced a healthy growth of 33% during that period. The brand is already eyeing international expansion beyond UAE to US, UK and Singapore.⁷
However, the way forward is not without some challenges.
Given that the ready-to-cook category is slated for robust growth, players across the spectrum, from legacy players like MTR to new-age ones like Fresh To Home have entered the fray and the category is increasingly getting crowded and competitive. On the other end of the spectrum, especially post-pandemic, many home chefs have also started entering the space of ready-to-cook food, selling batters and mixes in their own hyperlocal catchment. It will be very hard to challenge them on freshness and familiarity. Put together, these may also chip away at some of the potential category share.
iD started with breakfast staples and attracted consumer attention with its innovative offerings in the ready-to-cook space- from fresh batters to filter coffee. However, as it ventures beyond this familiar territory into products like curd, paneer and bread, iD might find it tough to differentiate itself from the other players. That’s because these categories already have well-established entrenched brands and all of them are trying to own the equities of ‘natural’ and ‘preservative free’.
Finally, iD is still predominantly perceived as a ‘South Indian’ brand, due to its product portfolio being dominated by South Indian staples. This tag might prove to be limiting in expanding iD’s pan India appeal.
However, despite challenges, what’s also true about iD is that it is a brand that has proven its mettle in finding innovative solutions and executing them excellently. It’s safe to say that we can look forward to more tasty fare from iD in the future.
- “Building a 100 Cr business from scratch – Startup Success Story, thetalk tv: https://www.youtube.com/watch?v=jC_-GSeOJSE
Indeed iD is a great brand. It’s products are great. But in Chennai, their products are difficult to find.