Popular northeastern band Pong-Lang Sa-Orn promotes Mama’s newest instant-noodle flavour, ‘tom sap’, launched yesterday by Sahapathanapibul.

Sahapathanapibul, distributor of Mama instant noodles, will allocate a marketing budget of Bt500 million to stimulate demand. The overall market expects a big decline in growth, from 10 per cent last year to 5 to 6 per cent this year.

Of the total marketing budget, more than Bt50 million will be invested in yesterday's launch of the newest instant-noodle product, tom sap - a popular traditional soup from the Northeast.

Mama currently has 49 items in its instant-noodle portfolio. Two major flavours, tom yum kung and minced pork, however, generate 60 to 70 per cent of total sales.

"Despite the weak economy, we need to grow substantially," said company director Pennapha Dhanasarnsilp.

She said that supported by a huge marketing budget, the company expected to increase its sales by at least 10 per cent this year and its market share from its current 52 per cent to 58 per cent.

"We expect the overall instant-noodle market to experience a slow-down in growth to only 5 to 6 per cent this year, down from more than 10-per-cent growth in 2006," said Pennapha.

She said the Bt10-billion instant-noodle market had been challenged by a huge base of consumers affecting the overall market slow-down.

She said Thais consumed 32 to 35 packages of instant noodles per annum on average, lagging behind only Japan and South Korea, each of which consumed about 50 packages per year.

"Thai consumers always love to try new instant-noodle flavours in addition to such conventional products like tom yum kung and minced pork," she said. "We worry about how we can actually meet the taste requirements of today's consumers and persuade them to buy our product instead of our competitors'."

ACNielsen reported a decline in year-on-year growth of the overall instant-noodle market last month, from 10.1 per cent to 9.2 per cent in volume and from 10 per cent to 9.7 per cent in value.

The Kasikorn Research Centre (KResearch) recently also revealed the instant-noodle market was expected to grow only 6 per cent this year for a total value of Bt11.6 billion, due to reduced consumer spending.

The forecast of 6 per cent is lower than last year's growth of 10 per cent. Although the cost of living has dropped, thanks mainly to falling oil prices and interest rates, both of which look set to fall even further this year, consumers continue to wait and see how the continuing political uncertainty will be resolved, KResearch said in a report.

Last year's flooding in the North was partly responsible for the 10-per-cent growth, but demand is expected to return to a more normal rate of 6 per cent this year.

To boost sales this year, instant-noodle manufacturers must devise new and more aggressive marketing concepts to promote their products, especially advertising and event marketing.

Most instant-noodle firms have launched new flavours. The greater variety is expected to keep production costs down and maintain business growth and competitiveness this year.

KResearch recommended instant-noodle firms concentrate more on exports to make up for reduced domestic demand.

"Amid the slow-down, every instant-noodle player needs to offer new value-added features for their instant-noodle products, including launching new flavours," said Pennapha.

Pennapha added that Mama was the leader in the white-noodle segment, with an 85-per-cent share. White noodles account for 8 per cent of the total instant-noodle market.

KResearch also reported instant-noodle production costs looked set to rise this year, because wheat prices increased 10 to 20 per cent last year and were still climbing. World wheat production is expected to drop from 624.5 million tonnes in the previous fiscal year to 591.8 million tonnes during the current one.

Kwanchai Rungfapaisarn

The Nation