“A great idea backed up by a clear vision and competitive strategy leads to success in any business”.
The Kolkata based duo of 2 friends has proved above statement with the success of their venture Wow! Momo Foods Pvt. Ltd. Wow! Momo brand is a famous fast food restaurant chain and headquarter is in Kolkata, West Bengal. The brand is specialized in momos making which is a popular dish in Nepal, some parts of Tibet, and India. It has become India’s largest momo chain based on different factors like volumes, innovations or variety in product, and turnover.
Sagar Daryani and Binod Homagai are the founders of Wow! Momo and established the brand in 2008. Both duos are from alumni of St. Xavier College, Kolkata. Their success can be interpreted by the fact that the brand has generated revenue of Rs. 120 crores in FY 2019. The will power of both founders has put them on the path of success. The business was initiated with a small amount of investment of Rs. 30,000 and now in a couple of years, its valuation is in crores. The brand has expanded its chain in different cities in India i.e. Kolkata, Delhi, Mumbai, Gurugram, Faridabad, Ghaziabad, Noida, Bengaluru, Chennai, Cuttack, Cochin, Rourkela, Puri, and Bhubaneswar. Also, at present, it occupies 254 outlets in these cities.
The credit of success of Wow! Momo goes to its strategic and result-oriented Business model that transformed a Kiosk into a QSR (Quick service restaurant) chain having a valuation in crores. A business model of any business reflects its products or services, target market, promotion strategies, competitors, pricing, revenue generation, future expansion strategies, etc. The base of the competitive business strategy of the brand lies in its history of 10 years back.
2. A brief history of Wow Momo
Sagar Jagdish Daryani and Binod Kumar Homagai, Kolkata based entrepreneurs started their venture Wow! Momo in 2008 with a minimal investment of Rs. 30,000. Both founders of the brand were dreamt for momos business at the time of sharing the same batch in their M.Com studies at Kolkata’s St. Zavier college. Both of them were momo lovers as Binod is from the place where momo has its origin i.e. Nepal whereas Sagar was fond of momos of momo-seller who used to sell momos outside school. By observing momo-seller, Sagar got an idea of making a different verity of quality momos in a short time. This idea clicked him to look for a momos business by experimenting with different variations in momos and he shared the same with Binod who also found his Idea innovative.
In fact, at that time both had a dream job offer also of the International bank through campus selection with a package of Rs. 3lac p.a. But both of them took a risk and choose to go ahead with their idea of making momos rather than accepting job offers. By their success today, they proved that taking risks is an important feature of Entrepreneurship.
The initial investment of Rs. 30000 was made by Sagar’s parents and with this investment both started their venture Wow! Momo and the brand got the name in 2008. They started this in a 200 Sq. ft. size kitchen with one table. They hired 2 cooks on a part-time basis on a nominal pay and raw-material to make momos was taken on credit terms from a local grocery shop. These became the base of emerging business i.e. Wow! Momo.
Further, they got a 6*6 kiosk on a rental basis at Spencer’s retail situated in South Kolkata in terms of 18% revenue sharing on a monthly basis. Initially, they sold Momo @ 40 Rs. per plate. Through their marketing campaigns and promotional activities, they could generate a market base for Wow! Momo. As a result, on the very first day, the brand generated a sale of Rs. 2200 approx. and by the end of the month, sales moved up to Rs. 53000.
Once the customer base of the brand developed, both entrepreneurs of Wow! Momo got an offer for Kiosk space from hypermarkets. So, the first independent outlet of Wow! Momo opened up in Sector V in Salt Lake, Kolkata in the year 2010. This time the investment was Rs. 14 lacs. They further expanded branches in different other cities like in 2011, a new outlet in Phoenix at Banglore was inaugurated. As of now, Wow! Momo carries more than 200 outlets in India in different cities as stated above.
Initially, they had faced many challenges and problems as they were not familiar with the new business concept. But with their simple model of momos and marketing strategy, they could reach revenue of 100 crores. Afterward, they didn’t look back. Their very first funding worth more than $2 million was initiated by them in July’15 and from Indian Angel Network. Further, they initiated the next funding worth Rs. 440 million in May’17. From then on, the brand is climbing stairs of success.
3. Business Model of Wow Momo
A Business model is a defined plan of any business that shows a clear path of how that business earns profits. The Business model reflects the strategy of a business for its success. A business plan or model is required in a fresh business set up or in the expansion plan of an already established business.
As stated above a Business model of any business comprises of below main factors:
The success of Wow! Momo is due to its revamped Business model on the above components, which are explained below in detail.
1. The Value proposition of Wow! Momo
The Value proposition of a business model consists of the products or services any business offers, value to its customers and also unique features that give a competitive advantage in the market.
The value proposition of Wow! Momo reflects in its exclusive product of varied momos which is a combo of quality, taste and different varieties. Today they offer 12 different flavors of momos in 3 forms i.e. steamed, fried, and pan-fried momos. Also, flour variants are mostly white and brown. Their different sweet or spicy sauces are being used to fry these momos to give Indian taste. Moreover, they have other verities like Momo chats, Tandoori momos, baked momos, Momo Burgers under the name MoBurg. Also, the brand carries a special ‘Chocolate momo’ dessert on their menu.
2. Target Customer base
The target customer base of Wow! Momos are both Gen-Z and Gen-Y as momos are liked by both generations. Their bulk customers are young customers of Gen-Y i.e. students and working professionals. They cater to the need of both vegetarian and non-vegetarian customers.
3. Marketing or Promotion Strategy:
a) Current or early-stage marketing strategy:
The business model of Wow! Momo consists of strong marketing or promotion strategies that cover its USP (Unique selling proposition) as well. The Brand is using different effective marketing tools i.e. digital or social media, Public relations, branding, etc.
In the initial phase, Wow! Momo had chosen a yellow color for Kiosk for promotions and to organize marketing campaigns. Their marketing campaign used to be product-oriented. Due to a shortage of finances for leaflet printing, both entrepreneurs of the brand used to sale samples of their momos in a tray by wearing Wow mom t-shirts. This idea of branding and marketing worked well and clicked customers. In result, their sale which was Rs. 2200 on the first day had gone up to Rs. 53000 at the end of the first month.
Their current marketing and branding strategy is mostly through social media like Facebook, Twitter, Instagram, etc. The brand believes in marketing through customer experience by opening new stores, outlets, and Kiosks, etc. The logo is an eye-catching logo with yellow color and also they advertise in malls i.e. on outer walls.
USP of Wow! Momo
Very innovative and different flavored hygienic, fresh momos, especially Pan fried momos are the USP of Wow! Momo. They offer both veg and non-veg momos. Few verities of momos include steamed moms, chicken momos, chicken and cheese momos, schezwan momos, prawn momos. For vegetarians, they have a range of corn momos, corn and cheese momos, Mashroom Momos, etc.
The stores or outlets of Wow! Momo is available in 4 different formats i.e. kiosk, food courts, high-street restaurants, and high-street shops. The shops have a capacity of 20 people and restaurants have a space of 1000 sqft. They have drafted their strategy as such that even the smallest kiosk is generating revenue worth Rs. 12lacs monthly. Different formats of their outlets allow them to choose the right location according to the shop size.
Wow! Momo is an innovative brand. Be its products or promotion of products, the brand always do experiment with innovative ideas. Wow! Momo was introduced on wheels in Metros stations and further expended to different happening areas like the open area of malls, Corporate tech parks. Further, Wow! Momo Food bus or Truck was launched in Amusement park, Nicco park in Kolkata. Also, similar formats introduced in Bangalore in Tech parks.
It was difficult to launch Wow! Momo Kiosks at Airport due to smoke emission. So the brand came up with Mango Momo dessert. It was a combo of Alphanso Mango pulp which was used as a momo stuffing and poured Mango syrup as an add-on flavor.
b) Current and future expansion plans:
Wow! Momos are in expansion mode. After the massive success of their momos, they recently launched their next brand i.e. Wow! China. This brand has a feel of the Indian version of Chinese cuisine as Chinese food is quite popular among south and north Indians.
They are also planning to open more outlets of both Wow! Momos and Wow! China at the end of 2019-20. By 2020, they aimed to have 350-400 outlets and also the turnover of Rs. 300 crores in terms of revenue. To reach their customers online through food platforms like Zomato and Swiggy, the brand has planned to initiate the opening of cloud kitchens too. Their vision is to open 1000 outlets of momos in the coming years. Also, adding more diversified and varied momo flavors in the menu of Wow! Momos. The brand is exploring global opportunities also especially in the Middle East. They have more innovations in their kitty like “chilled momos” for supermarkets, gluten-free momos, etc.
4. Competitor Review:
Wow! Momos have competition with street vendors of momos who sell momos at a lesser price. But the high quality, hygiene and different flavors of momos give a competitive advantage to Wow! Momo over street vendors. Moreover, there is no other organized momo brand in the country to compete with Wow! Momos and Wow! China. The brand Wok to Walk has started its operations in India but restricts to NCR region and one Kolkata based outlet.
5. Revenue Generation:
Started with revenue of Rs. 2200 and followed by Rs. 53000 by the end of the first month, now the brand has touched revenue of Rs. 120 crores. This is a huge success for any brand. Their menu is designed in such a way that they are able to generate revenue above Rs. 12 lacs monthly through their 7*7 kiosk that is the smallest one.
Both entrepreneurs worked very hard for the success of Wow! Momo. They started with an idea and that idea has spread all over the country. Their dedication towards work and passion for their aim has set an example for others. Their success mantra lies in continuous product innovation. When both entrepreneurs of the brand started the business, they didn’t think much about failures. Their more focus was on being successful. So as an Entrepreneur of a start-up, it is more important to believe in the idea and its success further. The brand has proved that even with limited resources to start with, innovation, dedication, and belief can put anyone on the path of success route.