Lay’s potato chips are the most favourite snake option for the children. Every time we open Lay’s bag, we find a bag full of air and little chips in it. But when we visit the local chips shop they sell bag full of chips. Every time I eat lay’s, I wonder how a company could earn thousands of crores of rupees just by selling air. Let us know about the success story of air + chips selling company lay’s which generated 8000crores.
Herman Warden Lay the founder of H.W Lay Co. Lay’s first food company to be advertised in Tv’s in America. Initially Herman Lay worked as a sales boy in a chips company. He used to sell and market the chips. With this experience, he was able to study chips market in the USA.
Company establishment:
With this experience, he started Lay’s company and collaborated with his ex-company. Using their infrastructure and sales he produced good quality chips at affordable prices. In the year 1961, Lay’s partnered with Frito and evolved as “Frito Lay”.
In 1965, Frito Lay partnered with America’s leading marketing company PepsiCo. They have taken Lay’s advertisements to cloud nine. PepsiCo’s idea was to advertise the Lay’s on television. They have created history with that ad. Their sales rose higher with that advertisement.
PepsiCo has the largest dealership in America and some other nations across the globe which made Lay’s penetrate the American market easily.
Why Lay’s sales air than chips:
According to Lay’s officials people get satisfaction only when they get the crispy sounds of the chips while eating them. Also, only fresh chips will be chosen by customers. Personally, for me also that crispy sounds feels nice.
While coming to the air factory. The air they fill is nitrogen. Nitrogen helps chips to keep fresh. At the same time during transportation the air protects chips from crashes and breaks which makes every bag of Lay’s feel fresh while opened.
This is the reason behind Lay’s becoming an air-selling company.
Lay’s into India:
For any industry around the world, India is the biggest market. Because our country has a wide range of diversification. Every state has its own taste and tradition. Gaining the market in India will be the biggest achievement for any company.
Before entering into India Lay’s have already entered many countries and made their success stories there. Lay’s is not an ordinary company that enters any market without preparation. Lay’s taken u the biggest task to capture the Indian market. Uncle Chips is ruling the market before Lay’s.
In the year 1995, Lay’s entered the Indian market. In just 5 years, they evolved as a leading company in the potato chips market. Lay’s was successful in capturing the Indian market in a shorter time frame. They have inherited Indian spices into chips for attraction. Not only this, there are many strategies. let’s know about them.
Marketing in India:
As well know most Indians obsessed with heroes and cricketers. Lay’s started their high-level marketing from this point. They made huge ads with heroes and cricketers. Mutual fans owned the Lay’s as their idol was advertising Lay’s.
With celebrity advertisements, they were able to gain a major number of customers all over India. But for Indians taste also matters and publicity. Lay’s used Indian spices which made more closer to people.
They have conducted a competition between Dhoni and Saif Ali Khan. They have given Dhoni a flavor and Saif a flavor. Customers need to vote for their favourite one. This made them publicity and study people’s tastes. We Indians are mostly middle class. For us only taste doesn’t matter price also must be most affordable.
Price marketing by Lay’s:
Lay’s unique ads made them the most popular in India. They have a well-studied Indian mindset. That’s the reason they have launched the ₹5 lays. As per reports, 72% of Indians are likely to buy ₹5 Lay’s.
There is an additional benefit for the polluted cities. Just open a bag of air, feel the fresh air and enjoy.
Just kidding.
Lay’s uniqueness:
Lay’s made its mark in the market of potato chips with its unique flavors. They include locals’ tastes of the country as they launch in a country. Red Lay’s are common in many countries but they taste different from country to country.
Japan is famous for wasabi, and they have inherited wasabi from Lay’s. Italy is for beef meat which they include in their chips. With this idea, every corner of the globe has owned Lay’s to heart.
I have seen Pringles in the Indian market. Good chips taste awesome but not as good as Lay’s. Pringles sells American flavors in India. Where people were not able to accept other tastes and also their prices started to a very high range.
Lay’s captured the world market by creating 200 flavors of Lay’s. a huge kudos to their research team. As per their flavor vision and establishment. The research team are huge. They go through different kinds of people across the globe and report their tastes including all these reports they decide on the new flavor of Lay’s.
Flavor campaign by Lay’s:
“DO US A FLAVOR” is the biggest campaign by Lay’s. where they asked customers to send their recipes of Lay’s. For the best flavor they announced a 1 million crash price or 1% market share for that flavor.
Through this campaign, Lay’s captured some 1000’s of recipes in America. This was a huge success in the USA.
Later on in 2012 same campaign launched in India. In India also it is a huge success which made them more flavors from people. They only select the flavors which are good in taste and easy to make as per their circumstances.
As the flavors came from common people marketing was not a big thing though. There was a huge surge in sales but due to some fake submissions and issues mugged up over the campaign Lay’s had stopped it in 2016.
The new strategy:
I can say most of the people saw this marketing “smile dekhe dekho” by Lay’s. Lay’s bags were printed with real smiles faces of celebrities like Alia Bhatt, and Ranbir Kapoor. Clicking a selfie with a smile was the contest. This also caused a surge in prices as the bag looks unique and the faces of their favourite actors on bags.
By covid Lay’s was able to capture 50% potato chips market in India.
Potatoes used in Lay’s:
They are different kinds of potatoes, and each of them is unique and needs to be cooked like that only. This may sound odd, like potatoes, all are just the same anything can be made curry, chips, French fries but the bitter truth is all potatoes don’t fit everywhere.
We all know Indian Mangoes are famous but not all mangoes taste the same and are used for the same purpose. Some are for juice, some can be cut into pieces, and some for pickles. Just like mangoes, potatoes are also different. Potatoes differentiated according to their starch content.
Lay’s uses FC5 potatoes. This kind has a high liquid content which makes the best chips crispier. Punjab, UP, Bihar, Karnataka, Maharashtra and West Bengal states grow more potatoes. Lay’s company has contracted with farmers in these states.
These seeds are provided by Lay’s company and also training regarding potato farming is given by Lay’s. As per the soil condition, every farmer brutified respectively about the farming and usage pesticides. They use mobile apps or mobile-based connections with farmers regarding climatic changes. Lay’s farming officials visit crops once in a while to check difficulties.
With efforts from company farmers work was made easy. Buyback was guaranteed which made more farmers get contracted by Lay’s.
Adoption of changes as per trends:
Covid made the whole world stop for a while, and question ourselves about our health. Which made every person think of their health condition and eating habits. People were trying to avoid junk and processed food.
This was a drawback for Lay’s because the chips have high sugar and salt content. These kinds of processed foods are a health risk. All though there would be a huge crash in the chips market.
The giant Lay’s came up with a new variant which makes them why all call them “THE GIANT”.
Oven-baked chips by Lay’s contain 65% less fat than regular ones and 25% have fewer calories. With this variant, Lay’s was able to sustain itself after COVID. Even gym rats attracted to it.
Last but not least factors for the success of Lay’s:
Their packing and distribution. Their packing is well designed, as ever bag opened we can feel fresh Lay’s present over there. This is all because of nitrogen. And most of the chips won’t get broken because of air.
And PepsiCo’s biggest distribution network made Lay’s penetrate every corner of India easily. Now Lay’s are sold in every village in India. No company can penetrate like Lay’s and create flavors. My kudos to Lay’s as they sent the well-established Indian brand Uncle Chips to dark with their strategies and marketing.
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