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The Five-Rupee Bar That Changed Naturell · Zero Shot Podcast DEMO

• 0:00
  speakers: Naturell’s path from failed launches to a scalable health-food business turns on consumer insight, ambition, and the practical work of building products in India.
• 0:24
  I am from a very small village near Nagpur.
• 0:30
  Village so small that did not have a post office, even does not have a post office today.
• 0:36
  Interviewer: Did not have a school, did not have electricity when I was born.
• 0:42
  So the school started for my brother
• 0:45
  Interviewee: when he was in school going.
• 0:47
  My grandfather did not want to send him to the nearby Nagpur.
• 0:53
  So school started actually in our barn or warehouse.
• 1:02
  And in his case it was up to second standard, in my case it was up to fourth standard.
• 1:08
  Because in fifth standard there were no students who would be there.
• 1:12
  So I was sent out to my Nana's place.
• 1:17
  And always my father, you know, family is passionate about education.
• 1:22
  So I was sent to Nagpur for further education.
• 1:25
  Interviewer: And I had option after 12th, most of the students in the professional engineering medical.
• 1:33
  And I had admission in one of the very good engineering college and agriculture college.
• 1:38
  Interviewee: I chose to pursue agriculture.
• 1:41
  And the reason I am telling about agriculture and the background of the farming, it is in a way related to Naturell.
• 1:51
  So I did my BSc, MSc.
• 1:55
  While doing MSc, I used computers for statistical analysis.
• 2:02
  Now today it sounds very mundane.
• 2:05
  So what's the big deal?
• 2:06
  We use computers for statistical analysis.
• 2:09
  Everybody does.
• 2:10
  The only thing is, it was 1983 -84.
• 2:14
  So when computers, you know, was not accessible.
• 2:19
  You couldn't touch and feel.
• 2:20
  It was only typically kept in an air conditioned room.
• 2:24
  And through the glass window, you know, we could see
• 2:27
  speakers: Computing would become more than a technical tool: it shaped a view of products.
• 2:32
  Interviewer: It is not just writing the piece of code, but understanding what users are looking for.
• 2:40
  And, you know, I, from a technology model, finance and operation as part of my company.
• 2:46
  And I had taken up that challenge to build product out of India and move back to India after 15 years.
• 2:59
  speakers: it.
• 3:00
  That kind of fascinated me.
• 3:03
  And so instead of, you know, going back on the farm, I kind of, you know, got fascination and ended
• 3:11
  up doing my master's in computer science from Florida in the USA.
• 3:17
  So I changed the track completely.
• 3:19
  And, you know, after that, I worked in the industry.
• 3:24
  Like most of the, you know, software professionals come to Silicon Valley in California.
• 3:28
  And I also, you know, came there, worked in the industry, Unix device drivers, operating systems, all the internals of,
• 3:36
  you know, computer science.
• 3:44
  Interviewee: Product company.
• 3:46
  Multiple different companies.
• 3:47
  And I'm not going to get into my software.
• 3:50
  But one of the things I tried to do was build products of India.
• 3:55
  Today's India is way different than what it was in 1991 and at
• 4:03
  that time.
• 4:05
  Interviewer: The Indian engineers were and are very talented.
• 4:11
  But that time, we were not able to get the product out of our software office in
• 4:19
  Mumbai.
• 4:22
  And the same individuals coming to our Silicon Valley office, their performance was like superb.
• 4:29
  Interviewee: It was the difference of night and day.
• 4:32
  And we realized it's the same individual.
• 4:37
  So what is the difference in the product culture?
• 4:40
  Having them go through, understand what it means to build the product.
• 4:48
  speakers: The product lens eventually returned to the farm.
• 4:53
  After coming back here, you know, multiple different companies and the company that I formed,
• 5:01
  you know, that was doing, I was doing, building product, large telecom companies and out of 500
• 5:09
  companies, 350 companies are customers of our telecom search.
• 5:15
  But while doing this, it was always kind of connecting to the farm.
• 5:22
  And I was thinking, what can I do for the farming community?
• 5:27
  So I thought of different projects.
• 5:30
  And I came across a herb called Stevia.
• 5:35
  I'm sure you all know about Stevia today.
• 5:40
  To me, what got my attention was because income level
• 5:48
  for Stevia for farmers is about ten times higher than wheat and cotton, the
• 5:55
  typical crop that people in my area.
• 6:00
  And also, zero calorie, Naturell, herbal sweetener.
• 6:20
  Interviewer: where I can try out the Stevia products, understand
• 6:27
  how big the market is.
• 6:31
  Because whether a thousand acre plantation is required or a billion acres required, unless we know what is the
• 6:38
  consumer demand, you know, no point is going to the back -end integration.
• 6:43
  speakers: Before founding Naturell, the founder says 350 of 500 companies were customers of their telecom software business.
• 6:51
  Interviewee: Okay.
• 6:52
  And Naturell as a company started with that.
• 6:55
  It was more of a social cause for me to do something for the farmers.
• 7:03
  And that's how I kind of switched my gears from software to
• 7:11
  consumer products.
• 7:14
  And when we started, that was my first consumer business in Naturell.
• 7:20
  Previous one, I was, per transaction was about half a million dollar to one million dollar.
• 7:26
  Coming from there to 50 rupees for tabletop sweetener, 100 tablets,
• 7:34
  50 rupees for a sachet of 50 rupees.
• 7:38
  And very different bargain.
• 7:40
  I had no experience in consumers.
• 7:43
  But as an entrepreneur, you know, a lot of passion left.
• 7:50
  So different initiatives that we had taken.
• 7:55
  And there was the first consumer business and Stevia had certain issues from approved, not approved.
• 8:03
  You know, when we had, it was an outsource manufacturer of the license that were taken.
• 8:22
  And I said, oh, what do I do now?
• 8:26
  So the idea about Stevia for
• 8:34
  farmers, our tagline was
• 8:41
  healthy urban, wealthy rural.
• 8:47
  That was the first tagline for the company that we started.
• 8:54
  And in this business, when
• 9:02
  we first company in an organized manner to launch
• 9:10
  Stevia as a tabletop sweetener, we started to launch Stevia.
• 9:17
  Today, the market is not more available.
• 9:27
  speakers: The Stevia roadblock came while Naturell had roughly 30 to 40 employees. Rather than stop, the business turned to nutrition bars, a category it believed India had not yet established.
• 9:39
  Interviewee: when the, you know, starting of the session today, for the startup,
• 9:48
  if you can cross the five years, for the, you know, you have done wonderful because
• 9:56
  90 % of the companies fail before the five years.
• 10:02
  And we had hit the roadblock just within a year or so.
• 10:07
  And that's what we had done.
• 10:08
  You know, you can talk about a lot of things that what you have done right.
• 10:12
  Okay.
• 10:13
  I'm also going to talk about on, in my journey, what did not work for us.
• 10:19
  So Stevia has a great concept, but it didn't work for us.
• 10:24
  So it was the easiest thing for me to say, throw in the towel, not my cup of tea.
• 10:32
  Okay.
• 10:33
  Blame on government, blame on, you know, things, you know, and bureaucracy here.
• 10:39
  But I said, no.
• 10:44
  We already had company about 30, 40 people that time.
• 10:47
  I said, what can we do?
• 10:50
  Having spent about 15 years in the US, nutrition bars was an upcoming industry day.
• 10:58
  And as a consumer, I said, this seems to be like a pretty good idea.
• 11:04
  And should we try it out here?
• 11:08
  It didn't exist.
• 11:10
  The industry did not exist in India.
• 11:13
  And now in few stores, you know, you had imported bars, either as a snacking bar or protein bars.
• 11:23
  Again, you know, you put the entrepreneur's hat and figure out how to do the formulation.
• 11:31
  So we launched bars under RightBite as the brand.
• 11:40
  So we have experience.
• 11:41
  We priced at 15 rupees.
• 11:44
  Don't know why we priced at 15 rupees.
• 11:46
  This is how much it's going to cost.
• 11:48
  We need to make some money.
• 11:49
  So let's price it 15 rupees because we're going to afford it 10 rupees.
• 11:55
  Initial concept.
• 11:59
  So we're going to make some money.
• 11:59
  Again, we position it as healthy chocolate for children.
• 12:09
  Very early in the game, we realized 15 rupees is not a good price point.
• 12:14
  You know, we talked to India.
• 12:16
  We didn't have either the understanding that the consumer research should be done or we didn't have resources to do it and both.
• 12:25
  Interviewer: But when we start selling it, you know, we started talking to the customers, talking to the distributors.
• 12:31
  They said 15 rupees is not a good price point.
• 12:33
  Do it at 10 rupees.
• 12:35
  And if you can do it at 5 rupees, you know, you tell the order and we'll accept it.
• 12:43
  Again, we were naive.
• 12:47
  We launched bars in 10 rupees and 5 rupees.
• 12:51
  Wonderful concept.
• 12:52
  A 5 rupee product.
• 12:54
  This is 1997 around, probably.
• 13:01
  96, 97.
• 13:05
  A concept of a 5 rupee bar giving calcium equivalent
• 13:13
  to one cup of milk.
• 13:15
  And I thought this is such a strong concept.
• 13:18
  This is just going to fly.
• 13:20
  speakers: The first RightBite bars launched at 15 rupees as healthy chocolate for children, before consumer and distributor feedback challenged the price.
• 13:31
  Interviewee: We will have to figure out how the manufacturing can happen.
• 13:35
  In our limited resources we had distribution from
• 13:43
  Kashmir to Kanyapumari and Gujarat to Guhati and everything in between
• 13:50
  including Dihar.
• 13:55
  Interviewer: We had advertisement on TV channels on the children's network and so on.
• 14:02
  And we were very hopeful.
• 14:05
  speakers: The early price was set without consumer-research knowledge or the resources to conduct that research, so the launch tested assumptions in public.
• 14:15
  We put the product out.
• 14:18
  After two months, we realized it's not moving.
• 14:28
  Interviewer: what we have put out.
• 14:34
  One, the premium outlets
• 14:37
  Interviewee: where a knowledgeable customer goes who understand health and wants to have a health product.
• 14:45
  A five rupees product for a new startup company
• 14:48
  Interviewer: they don't want to keep.
• 14:49
  Because even if we sell 100 pieces, it's only fine.
• 14:54
  And the product which is placed are the small Kirana store in those Burney.
• 15:00
  Interviewee: Customer, children going there, they're picking it up.
• 15:06
  Having it, this was the Rice Krispie paste bar with the calcium as the delivery or the value
• 15:14
  proposition.
• 15:16
  They say, Ullu bana ya, Buddu bana ya, chocolate nahi ya, iski opar.
• 15:23
  They say, this is a wonderful product but we don't have the right product reaching to the
• 15:31
  right consumers.
• 15:32
  So that was the second time where we got a setback.
• 15:36
  First as the exterior, second time as the five.
• 15:40
  Again, he didn't want to give up.
• 15:42
  Okay, as an entrepreneur.
• 15:45
  So he said, my biggest challenge there was telling consumers this is not a chocolate.
• 15:53
  This is a nutrition bar.
• 15:55
  This is a nutrition bar.
• 15:56
  Consumer doesn't understand at a startup.
• 15:59
  You don't have resources to tell the consumers.
• 16:02
  And even if with the large resources, consumer awareness is not a short period of time.
• 16:08
  It takes a long.
• 16:11
  So we said, what do we do?
• 16:13
  We said, it's a functional benefit.
• 16:16
  So we went against all the marketing rules.
• 16:20
  speakers: A brand right by it was on the front in a big gold letter.
• 16:26
  We said, we want to put the functional benefits right on the front.
• 16:32
  Because we cannot educate the customer that this is a nutritious product.
• 16:38
  So we identified three segments.
• 16:43
  RightBite then addressed three distinct needs: protein for gym-goers, lower calories for calorie-conscious buyers, and women’s nutrition.
• 16:53
  Consumer was not picking it up for another chocolate.
• 16:57
  Nobody is going to say workout as another chocolate.
• 17:01
  So that started to work for us.
• 17:04
  Also a positioning that was for 18 and below for children, healthy chocolate for children.
• 17:13
  That change to nutritious product for young, adult and above.
• 17:21
  And that strategy started doing well.
• 17:24
  We started getting fraction, we started getting repeat purchase.
• 17:31
  Among those functional benefits, one began to stand out.
• 17:35
  Among the three different segments, protein is what started doing well.
• 17:40
  The workout bar was giving 10 grams of protein.
• 17:44
  So we started doing activities of gymnasium activities and the same.
• 17:50
  The imported bars had 20 gram protein or 23 gram protein or 25 gram protein.
• 17:57
  It was costing 150 to 200 rupees and our bar was 40 rupees or 50 rupees at that
• 18:05
  time.
• 18:08
  Interviewer: By the way, if you want 20 gram, you take 2 of this, this is only 80 rupees as opposed to 150 rupees.
• 18:15
  But that doesn't work.
• 18:17
  Interviewee: With the protein, it needs high protein, low carb, you know, proper balanced nutrition
• 18:24
  and so on.
• 18:26
  So we said, okay, what do we do?
• 18:29
  Let's bring another bar which has 20 gram protein.
• 18:32
  That's how and when we're looking at, we said, what do we call this bar?
• 18:44
  speakers: Max Protein signalled a larger protein offer, and the range later grew from one variant to 12. But gym-goers alone could not sustain the next phase.
• 18:55
  Interviewer: What we realize that the gym consumers are limited.
• 19:03
  Interviewee: If we have to increase the business, what do we do?
• 19:08
  We also, when we talk to the consumers, we saw they are not
• 19:14
  replacing their protein shake.
• 19:18
  They're having that protein shake, but having our bar as a snack.
• 19:24
  Okay, they're replacing either sandwich or a ibly or whatever the snack that they're eating.
• 19:32
  So if it is only the snack and not the replacement of their protein shake.
• 19:40
  Interviewer: Then you say, what do we do in terms of positioning it as the daily snack?
• 19:47
  And by then, you know, our company had reached to a certain level.
• 19:53
  And that is the time we decided to take external funding.
• 19:58
  That was around 30 crore business at that time.
• 20:02
  And this was 2018 -19.
• 20:08
  30 crore business, not a very large business.
• 20:13
  But the positioning adds a healthy snack.
• 20:18
  And just by saying that a healthy snack, it doesn't work.
• 20:22
  You have to have a reason given to the consumer.
• 20:28
  So we said, what do we do?
• 20:34
  We looked at different properties of protein.
• 20:38
  We looked at protein as a building block of muscle everybody knows about.
• 20:45
  Right?
• 20:46
  That's what the protein aware consumers are taking it.
• 20:50
  Protein also has a property of satiety, filling of fullness.
• 20:57
  If I have to say, we all eat bhaal chawan, rajma chawan, sambar rice.
• 21:03
  When you eat, normally we eat a handful of rice and one katori of dhar.
• 21:11
  If you have one katori replaced with three katori, the rice portion goes down drastically.
• 21:18
  And you feel fuller, very strong.
• 21:22
  And also, you feel active for a longer time.
• 21:27
  If it is a rice consumption, more rice, you feel rethalgy.
• 21:33
  So giving sustained energy and keeping
• 21:37
  Interviewee: you active for a longer period of time.
• 21:39
  It's the property of protein.
• 21:43
  Protein also have different absorption.
• 21:48
  Like whey protein is quick absorption.
• 21:50
  So it's a medium absorption.
• 21:51
  Pc is a, you know, slow absorption.
• 21:55
  So we used blend of protein together.
• 21:58
  And use science.
• 22:00
  Did some clinical studies.
• 22:03
  And we have got the results that a 20 gram protein
• 22:11
  bar gives you sustained energy for 4 hours.
• 22:16
  And that's what we have put
• 22:22
  speakers: The next question was how to turn that benefit into a wider snack habit.
• 22:26
  Interviewer: snack is the area that we repositioned our farm.
• 22:33
  And this was 2019 and this COVID happened after that.
• 22:38
  So really the company journey in the healthy snack started from 2020, 21
• 22:46
  onwards.
• 22:50
  So what we have done.
• 22:53
  Chose the space as a healthy snack.
• 22:57
  And when we say healthy snack.
• 23:00
  And when we say healthy snack.
• 23:01
  speakers: For Naturell, a healthier chip meant more than cutting fat: protein and fibre had to be part of the product.
• 23:09
  Interviewee: It is with protein and fiber.
• 23:14
  As the primary benefit to the consumer.
• 23:22
  Interviewer: It also gives satai tea.
• 23:28
  So we also looked at bars is a new category.
• 23:36
  speakers: A health-food platform had reached 160 to 170 crore, but the next scale-up would require more resources and expertise.
• 23:46
  Interviewee: Is not just the bar.
• 23:48
  It's a platform.
• 23:50
  It's a platform.
• 23:51
  For LD snack.
• 23:53
  So we build the business.
• 23:57
  To.
• 23:58
  160, 170 crores.
• 24:00
  Is the right now.
• 24:04
  And to this.
• 24:08
  We looked at it.
• 24:10
  And to say.
• 24:12
  What is the next thing.
• 24:14
  Right.
• 24:15
  We build the business.
• 24:16
  Like I was telling.
• 24:17
  For any entrepreneur.
• 24:18
  For any brand.
• 24:20
  Zero to 25.
• 24:21
  Is a one journey.
• 24:23
  There.
• 24:24
  That concept is.
• 24:25
  Really sticking to the consumer.
• 24:26
  Or not.
• 24:28
  25 to 100.
• 24:30
  150.
• 24:31
  Is another stage.
• 24:33
  Okay.
• 24:34
  There.
• 24:35
  That concept is.
• 24:35
  That.
• 24:36
  Consumer liking it.
• 24:37
  Repeat purchase.
• 24:38
  There is.
• 24:39
  There is a.
• 24:40
  Very large number.
• 24:40
  Of consumer.
• 24:41
  But still.
• 24:42
  There are.
• 24:43
  Not like.
• 24:46
  Mega mega.
• 24:47
  Consumer based.
• 24:50
  For the next stage.
• 24:52
  Of the growth.
• 24:56
  speakers: Agriculture led to an unexpected encounter with computing: statistical analysis during an MSc in 1983–84, when computers were not readily accessible.
• 25:08
  Interviewee: It's not a normal thing for Indian consumer to have bar as part of their snack.
• 25:14
  You know, if you think of a snack.
• 25:16
  There will be 50 other items that will come before the bar.
• 25:20
  speakers: So what are those in terms of snacks.
• 25:27
  And look at it.
• 25:29
  One, the Indian palate is more for spicy chat pata for snack.
• 25:37
  Interviewee: Either the bujayas or the chips and the whole category.
• 25:42
  I am talking not the regular, you know, you are unorganized.
• 25:47
  Interviewer: So we say, how about chips?
• 25:49
  And to call, to make chips as a healthy.
• 25:53
  Is not many people, you know, many people have tried it.
• 25:58
  But hardly anybody has succeeded.
• 26:00
  Because to call it healthy.
• 26:02
  What we have done is reduce the fat percentage.
• 26:06
  speakers: Healthier snacks demanded category-building, not just a revised recipe.
• 26:12
  We created nutrition bar, protein bar as an industry.
• 26:19
  Protein chairs based on.
• 26:23
  Millets and super grains.
• 26:25
  Again, a new concept.
• 26:27
  First time in India.
• 26:28
  And I will say.
• 26:30
  Millet based protein chips.
• 26:32
  At least I am not aware if anybody else is doing problem.
• 26:35
  Interviewer: There are protein chips available.
• 26:37
  But those are pulsus based.
• 26:42
  Soft cookies.
• 26:43
  Another first time in India.
• 26:45
  We wanted to have.
• 26:47
  Typically for snack.
• 26:49
  Very common.
• 26:50
  In the backpack or a purse in office drawer.
• 26:53
  You know for snack.
• 26:54
  We typically have.
• 26:56
  Pack of.
• 26:56
  You know cookie or a biscuit.
• 26:59
  Very common.
• 27:00
  If you feel hungry sometime.
• 27:02
  You know it kind of comes handy.
• 27:03
  So we said.
• 27:04
  A biscuit cookie category.
• 27:07
  Numkin category.
• 27:08
  That's what we have snacks.
• 27:09
  We had food.
• 27:10
  But we made it healthy.
• 27:13
  Along with this.
• 27:15
  We have granola.
• 27:17
  We have peanut butter.
• 27:19
  We have plant protein.
• 27:20
  So max protein.
• 27:26
  speakers: A broader portfolio also raised the question of what scale would require.
• 27:31
  Interviewer: We looked at it.
• 27:32
  And we said.
• 27:34
  As a company.
• 27:35
  What is it.
• 27:36
  That we want.
• 27:37
  From here.
• 27:39
  And.
• 27:42
  I.
• 27:43
  Always.
• 27:43
  Look at.
• 27:45
  What is right for.
• 27:46
  The brand.
• 27:48
  Right for.
• 27:49
  Individual.
• 27:50
  Me as a.
• 27:51
  Shareholder.
• 27:51
  Me as a.
• 27:52
  Promoter.
• 27:53
  For my.
• 27:54
  Employers.
• 27:54
  For my.
• 27:55
  Suppliers.
• 27:56
  For everybody.
• 27:57
  If the brand.
• 27:58
  Grows.
• 27:59
  And for me.
• 28:00
  As an.
• 28:00
  Entrepreneur.
• 28:06
  For me, I wanted to see what does it take to build the brand for
• 28:13
  1000%.
• 28:15
  This is not a target for next year or two years or five years, whatever number of years.
• 28:21
  But you have to set something, some target or the goals in your life for the brand.
• 28:26
  And to me, I said, I want to make a brand which is 1000%.
• 28:30
  speakers: The route to that ambition ran through a larger health portfolio.
• 28:35
  brand portfolio in the health segment was important.
• 28:42
  And as part of that, we felt this partnership makes lot of
• 28:50
  sense for achieving what the dreams that I have set up.
• 29:03
  The Zydus Wellness transaction kept Naturell as an independent subsidiary, operating as a separate business unit within the health portfolio.
• 29:12
  Interviewer: It was our board meeting and we completed