Binging the smart way?: Palm oil-free claim boosts healthy snacks popularity

PepsiCo India recently initiated trials to substitute palm oil with a blend of sunflower oil and palm olein in Lay's chips to make it relatively healthier for Indians. Another of the world’s largest food and beverage company, Nestlé, has significantly reduced saturated fats in many of its products (by 10% in some products) and is addressing concerns about refined palm oils and other refined vegetable oils by working with its suppliers to ensure that levels are as low as possible.

For years, these popular brands were accused of using cheaper and less healthy ingredients to make products for the Indian market compared to the ones catering to the US and the UK markets; which mostly has to do with the economies of scale and the use of cheaper ingredients to sell products at a cheaper price to India’s cost-conscious consumers.

So, when companies of this scale transform their ways, it is sure to impact the market trends.

But one may ask what propelled this transformation? For one, Indian consumers have become increasingly health-conscious. And they now seek transparency in product ingredients. In fact, according to a recent Mintel Report on salty snacks in India, 39% of consumers agreed that snacks made with palm oil are unhealthy. This sentiment is particularly strong among metro dwellers, who drive the demand for palm oil-free alternatives—50% of them considered snacks made with palm oil unhealthy.

It is for that reason that the palm oil-free claim has gained significantly more traction not only in the metros but in smaller cities too and the traditional reliance on palm oil as a key ingredient in snacks is being questioned.

One such brand carving a name for itself is the Chennai-based direct-to-consumer (D2C) brand, Sweet Karam Coffee (SKC), which sells filter coffee, snacks, and sweets—all free from palm oil and preservatives. Its snacking range offers affordability—priced between Rs 69 to 99, and it also includes non-fried options alongside a variety of millet products. Present both offline and online via quick commerce, marketplaces, and retail outlets, it is witnessing a promising demand surge from tier-II cities, apart from just the metros.

Nalini Parthiban, Co-founder & CEO, SKC, told Storyboard18, that in the thriving landscape of healthy snacking in India, there lies a remarkable opportunity fuelled by the evolving consumer mindset and shifting preferences towards wellness-centric choices.

However, amidst this promising landscape, the predominant challenge remains the accessibility and distribution network, heavily influenced by the dominance of established players with substantial resources.

To tackle it, another D2C player— Two Brothers Organic Farms— is working overtime to expand its offline presence and market visibility through pop-up stores and retail outlets, in addition to leveraging the reach of popular e-commerce platforms and hyper-local delivery companies like BlinkIt and Bigbasket, shared its Co-founder, Satyajit Hange. The brand uses heart-healthy riso oil, cold-pressed coconut oil, and edible sunflower oil to prepare its healthy snack items which start at Rs 149. This category is said to contribute to almost 20% of its total revenues for the coming fiscal year. Brands engage and educate potential consumers

Available market data suggests that the Indian snacks market size is expected to grow 2x in the next 8 years to cross $10 billion by 2032 (organised player share >60%), and experts believe healthy snacking would be a significant contributor to it. This revolution against cheaper and unhealthy ingredients in packaged food has taken the form of a noticeable revolution in the country, where brands that rely more on fresh, clean, and unadulterated ingredients are likely to sustain and emerge as a preferred choice for certain consumer groups.

As these healthy snack brands continue to make strides in the country, experts opined that the ideal marketing strategy for the category would capitalise to engage and educate potential consumers.

For its part, Two Brothers Organic Farms uses the reach of its social media platforms like Instagram and Facebook to share its experience and engage with consumers. Its daily content focuses on not only sharing behind-the-scenes brand stories but also educating viewers about the environmental and health benefits of embracing organic food. Further to keep viewers engaged, it frequently collaborates with food influencers and vloggers who promote the virtue of home-cooked meals that reflect the essence of traditional Indian recipes and the benefit of clean eating.

In addition to online ads, campaigns, and connecting with the next generation of farmers, it conducts regular meet-and-greet sessions and pop-up workshops to connect with organic food enthusiasts and new-age farmers. To amplify this momentum, it is planning to increase its ad and marketing spending, with a focus on digital and print media.

Meanwhile, SCK prioritises product and brand integrity over flashy campaigns. With its core mission to establish a trusted brand and educate consumers about harmful ingredients commonly found in snacks, its marketing strategy revolves around its mascot, 'Janaki Paati', (founders’ grandmother) who embodies the essence of authenticity and clean ingredients, who also helps it to forge a deeper connection with the audience.

Apart from social media engagement, marketers would also need to identify the mindsets and contexts where healthy food choices are made, noted Nisha Sampath, Managing Partner, Bright Angles Consulting. “Food choices are an area where the same person can make both healthy and unhealthy snacking choices as part of their lifestyle. Also, healthy snacking should not be restricted to a premium price point to make it accessible to a wider audience,” she said.

Brands that aspire to do good will need to introspect and redefine themselves to deliver healthier snacks as part of their portfolio. For instance, after McDonald’s faced a backlash, it attempted to offer at least a few healthier dishes like salads. Further, in the long run, while education is important, strategies for behaviour change are also useful—Japanese snacks are often sold as multiple ‘small serves’ rather than one big pack. This helps people to break up their consumption, share with others, and eat more mindfully.

Sampath suggested, “A brand that wants to promote healthier eating needs to look at such strategies which also demonstrate how to eat healthier.”