THAILAND: Frito-Lay launches Pringles alternative

The imminent arrival of Lay's Stax onto the potato-chip market of Thailand will reveal an unguarded challenge by snack giant Frito Lay on the established popularity of Proctor & Gamble's Pringles. Both products are packaged in a drum and sport similarities in size, choice of flavours and price. Lay's Stax are produced by a subsidiary of PepsiCo, which hopes that the US imports will be well positioned to win some of the valuable market from Pringles. Since arriving in Thailand two years ago, Pringles have posted record sales, annually grossing around Bt1bn and comprising 16% of the local potato-chip market. Frito-Lay expects to capitalise on the product's popularity, and produce sales worth Bt120m over the course of next year."The market demand for potato chip products is very high in Thailand," explained the marketing director of Frito-Lay Thailand, Srun Chutharatkul. "Lay's Stax is meant to fill in the production vacuum created by the uneven supply of local potato crops that are used to produce typical bagged Lay's potato chips."He added: "The sales proportion of canned potato chips increased to 20% of the total potato chip industry in 1999, from 11% in 1998 since our products were in short supply. We will not lose sales opportunities any more after adding Lay's Stax."Currently being launched in Argentina and Thailand, Frito Lay has announced plans to release Lay's Sax onto six or seven additional international markets soon.Managing director of Frito-Lay Thailand, Jurmsak Siri-Panich-Gon, explained the choice of the Thai market as a launching base because it suited the ambitious company programme. On the domestic market, Lay's controlled the dominant 58% share, with potato chips accounting for 25% of the total snack market. "Our priority marketing strategy is to expand the potato-chip consumption base to 30% of the total snack market," he said. With this strategy, the company expects to gross revenue of Bt3bn during the next year.