Chapter 1 mentions that the company “needs to formulate a suitable positioning, which means using marketing to create a competitively distinctive place for the brand or product in the mind of targeted customers.” In many ways, positioning is the heart of marketing. One of the most notable examples of re-positioning is that of Shan Foods, who decided to move from functional to emotional positioning and to build an emotional connection with consumers by stirring up feelings of love, compassion, and nostalgia. The resulting campaigns of “Taste of Home”, “Shan Stories”, “Food with the Neighbor”, “One Biryani One Family” and “Not Just a Cook” took both the consumers’ and marketers’ world by storm (Dr. Aamir Khan, Case Advisor).
Introduction
If you were asked to list out the most ubiquitous Pakistani brands across the globe, what are the names that come to mind? If you are a food-loving overseas Pakistani, in all likelihood, you would exclaim “Shan Foods” followed by a hit of nostalgia and a sudden craving for a plate of chicken biriyani, just like the one you enjoyed back at home.
Even though Pakistan is not known to produce many globally recognized brands, Shan Foods enjoys an enviable international presence with shelf space in 75 countries across 5 continents. In a competitive global market for South Asian spices, with prominent Indian competitors like MDH, Everest Food Products and Eastern Condiments, and several other smaller regional contenders, Shan Foods has for the larger part, dominated the branded spice mix category, both in terms of global reach and the diversity of its product portfolio.
The Humble Origins
This iconic brand that has become a household name for Pakistanis all around the world was conceptualized over 40 years ago in the small backyard room of a young man named Sikandar Sultan when he recognized an untapped consumer need that no business had addressed yet. If you are even slightly familiar with South Asian cooking, you know how every dish, even the basic chicken curry, is a concoction of spices, many of them hard to identify or remember. Preparing South Asian food is a culinary art and requires a high degree of ‘chefmanship’. Traditionally, it has been a rigorous and time-consuming process that involved procuring a long list of ingredients, including a variety of spices, followed by grinding whole spices individually, and finally getting the proportions right - a slight deviation from the recipe could render the dish unrecognizable.
However, the world was rapidly evolving, economically and socio-culturally; so was Pakistan. The 1970s saw a change in the traditional household structure with the joint family system giving way to nuclear families and an increasing number of women opting for higher education as well as joining the workforce. The busier lifestyles spurred a demand for products that provided convenience and reduced the time and effort required to complete traditionally cumbersome tasks. During the same period, an exponentially growing Pakistani diaspora, especially across the Middle East, North America and UK was reshaping the business landscape and opening up potential opportunities to fulfill the immigrants’ need to stay connected to their homeland.
Sikander Sultan had the vision to identify these emerging trends just in time to make the first move. In 1981, he partnered with his wife Perveen Sultan, a fellow culinary enthusiast, and converted a small servant quarter into a home office. Together they began the painstaking process of perfecting different blends of spices for various dishes and drafting detailed recipes to go with them. Initially, the recipe mixes were shared within the extended family, and they were an instant hit. Soon, orders started pouring in from friends, acquaintances and eventually, from general consumers.
Here was a product that didn’t just simplify the cooking process and save time, it essentially helped blur the lines between amateur and expert cooking. With a box of Nihari spice mix, anybody could whip up magic in no time!
With a winning product in hand, Sikandar Sultan set on the course to revolutionize traditional South Asian cooking and bring ‘chefmanship’ to the table for people all around the world.
The Growing Market for Spice Mixes
Over the next few years, Sikandar and Perveen Sultan continued to scale the business by developing new blends, introducing plain spices and other value-added products, increasing penetration into existing markets and expanding the business’ geographic coverage to reach out to newer markets.
By the mid-nineties, Shan Foods had become a well-established brand, and before long, started making inroads into the ripe international markets where the Pakistani diaspora welcomed ‘the authentic taste of home’ with open arms and eager palates. In the 2000s, Shan Foods continued to widen and deepen its international reach in Europe, the Asia Pacific region and in Middle Eastern countries.
In the past four decades, Shan Foods has garnered global recognition due to its products’ consumer relevance, a widespread distribution network, and sustained quality standards. With an extensive RandD setup, Shan Foods has successfully launched over 88 different recipe mixes worldwide. Shan Foods also established manufacturing units in five countries to support the rising international demand for authentic South Asian recipes and spice mixes. Not surprisingly, while the South Asian diaspora acculturated to their host countries, the local populations, especially in North America and Europe, developed a taste for spicy ‘desi’ food as well.
The pie was getting bigger, heavier, and more diversified; but so was the competition.
Changing Market Dynamics
Shan’s initial success resulted from being the pioneers of the spice mix category in Pakistan. Sikandar Sultan noticed a wave of change forming in a big ‘blue ocean’, Shan was the first to catch it and ride it to the top of the leaderboard. However, others soon followed suit. Once the idea took off, several brands jumped onto the bandwagon catering to a more diverse audience, packing regional flavors, at times offering cheaper or more accessible alternatives.
International markets were also evolving faster than ever. The potential customer was not limited to people of South Asian origin anymore, as mentioned above; there was a burgeoning demand for ethnic South Asian cuisine among local audiences too. While Shan Foods was quick to seize this massive growth opportunity, other spice brands were not too far behind. The next few years witnessed a proliferation of South Asian spice brands across key international markets, especially in North America, Europe and the Middle East. With easy access to several brands each claiming to provide the ‘best’ taste, quality, variety or value for money, consumers were spoilt for choice.
In the past, Shan’s marketing strategy had been anchored in the product concept with a focus on functional advertising using a hard sell approach. Shan delivered a quality product that significantly reduced the time and effort it took to prepare authentic South Asian food. The brand’s unique taste profile had won hearts and minds within, across and beyond borders. In fact, due to its widespread popularity, many Pakistanis had started using the brand name ‘Shan’ to refer to ‘spice mixes’, the generic product category.
However, Sikandar Sultan soon realized that in a world of consumer hyper choice, brand clutter and increasing levels of perceived brand parity, a brand positioning strategy based solely on product differentiation was not enough to sustain long-term competitive advantage. He also realized that the contemporary consumers belonged to Gen X, and increasingly Gen Y (popularly known as ‘millennials’), who were well-informed, socially aware, and evaluated brands on a new set of metrics: relevance, meaningfulness and purpose.
Faced with these rapidly changing market dynamics and evolving consumer preferences, Sikandar Sultan had to decide: should they stick to the status quo that had worked so well for Shan in the past, or was its time to reevaluate and recalibrate their strategy as they stepped into the future?
The Revamp
Although Shan Foods was a conventional family-run business, Sikandar Sultan understood that to continue the journey of growth globally, the company required an experienced professional management, an increased focus on agility and a substantial investment into the front-end and back-end of the business. Hence, a new CEO with a solid track record in the food and beverages industry was hired, and internationally experienced functional heads were engaged and tasked with the job of modernizing systems and processes and deploying global MNCs best practices.
In the next few years Shan Foods broadened their product range and launched ready-to-cook sauces, cooking pastes, and other condiments. A special focus was laid on Shan Shoop Noodles and Shan Chutneys. To fulfill the company’s vision of being present on ‘every table, every day across the world’, Shan Foods was repositioned from being simply a spice brand to a more diversified culinary brand that puts consumer needs and wants at the center of all its value offerings.
An entirely new trajectory was formulated for the brand’s communications. A renewed value proposition and purpose was laid brick by brick. The objective was to build an emotional connection with consumers by stirring up feelings of love, compassion and nostalgia and resonate with the audience on a deeply personal level.
Consumer research showed that the target market had a very intimate relationship with food; it connects them to family, friends, fond memories, and for South Asian expats and immigrants, to their roots. Food is at the heart of every celebration, every social engagement, and every tradition. In short, for the target market, food is inextricably linked to love, joy, and togetherness.
This consumer insight laid grounds for the new brand positioning: ‘Taste Happiness’ (read: Khushiyan Chakh Lo). Over the next couple of years, a number of integrated marketing communications campaigns were built around this idea:
- 2015: Two Brothers based in San Francisco yearning for the ‘Taste of Home’ - a deeply nostalgic tear-jerker, it was an instant hit with both local and international audiences and the DVC went on to become one of the most viral videos on social media that year
- 2016: ‘Shan Stories’ - Video testimonials from actual Shan consumers living abroad relating how Shan keeps them connected to their roots by helping them prepare authentic traditional food
- 2017: ‘Food with the Neighbor’ (‘Khaana with Parosi’) - A Chinese immigrant settled in Pakistan looks to make friends by surprising her neighbors with the perfect Biryani; based on the cultural insight of sharing food to build neighborhood camaraderie
- 2018: ‘One Biryani One Family’ - A boy challenges social norms and cook’s biryani to impress a girl’s family to ask for her hand in marriage
- 2020: ‘Not Just a Cook’ - A loving father surprises his daughter on her birthday by replicating a Korma (meat curry) recipe just like her mother used to make, bringing back old memories and furthering the idea that cooking is not limited to just the women of the household
The Result
As a result of the end-to-end overhaul, Shan Foods was able to double its business and triple its PAT (profit after taxes) within 4 years. Better operational and buying efficiencies helped bring down COGS (cost of goods sold) leading to higher gross margins. Significant upgrades in manufacturing and food safety practices led to key certifications and accreditations like FSSC, BRC, ISO 14000, ISO 45001 and PS 3733 further strengthening its brand perception in international markets. As global consumer demand surged, so did Shan’s shelf presence within and across international markets, making its way into the product listings of leading international chains like Wal-Mart and TESCO. In the same period, Shan’s availability and visibility improved locally as well, with direct numeric distribution coverage doubling in Pakistan’s largest province of Punjab.
Moreover, the marketing campaigns also hit home with audiences worldwide and went on to win local and international accolades for effective advertising during the 2015 -2020 period including an APAC Silver Effie, eight Effie Pakistan awards, and multiple Pakistan Advertisers Society awards. The campaigns were among the most shared content on social media during their respective years of launch and consumer research showed an unprecedented increase in Shan’s brand equity and brand affinity.
The Way Forward
Shan Foods was set on the right course. The team’s efforts had yielded results and propelled the brand ahead in a busy competitive space. However, the road to success is long and strewn with challenges. While the spice mixes portfolio was bringing in the revenues and remained the key driver of growth and brand equity for Shan Foods, both locally and internationally, Sikandar Sultan knew this alone was not enough to fulfill his long-term vision of establishing Shan as the leading global ‘culinary’ brand. It was time for the team to start planning for the next milestone in Shan’s exciting journey of spreading the ‘taste of happiness’ around the world.
Questions to stimulate conversation on the case
- What was Shan’s communication objective in the marketing communication campaigns it launched over the years? Why did they switch from a hard-sell to a soft-sell approach?
- What are the challenges that Shan Food’s faces in transforming to a global culinary brand?
- What was the contributing factor in increasing Shan’s brand equity and brand affinity?
Links and media
Website: https://www.shanfoods.com/
Many successful brands, over time, face the challenge of the “me-too market”, where the product category itself turns into a near commodity. One such category is the medicines market in Pakistan. Searle Pharma’s case study is remarkable in the way the company boldly decided to deconstruct and reconstruct its culture and mindset, and engage healthcare professionals on a deep, emotional level, around themes such as depression. It also engaged in CSR activities like erecting sheds and umbrellas in public hospitals to provide relief to the public from the scorching heat (Dr. Aamir Khan, Case Advisor).