Hangry: Finding New Opportunities in Crowded Spaces

Introduction

A tasty way to take on industry giants

Abraham Viktor: Yeah, I think you’re absolutely right. It’s a very crowded market. But so is every other market if you think about it. We try to enter categories that we think are very large. One example would be fried chicken. So, the fried chicken category is known to be the largest food category in the world. And, in Indonesia, it’s definitely the largest category. And then, Japanese food is another category of sorts that across the globe, people just generally love it. So, we try to identify those categories and we especially like categories that are dominated by few players. So, for example, the fried chicken category here is dominated by some of the top fast food chains that we know. And, what we try to do is to come up with something that sells at a similar price range, but is absolutely better in the customer’s eyes. So, that’s how we decide on which category, and which brand to build. When the idea came, it was an intersection between my personal affinity towards the sector called F&B because I love food, and I’m not just a foodie, I actually vote for Asia’s best restaurant every year, so I’m seriously committed about eating. And, I thought that that means I’m one of the more picky eaters out there, and that means I should have a pretty demanding appetite or palette in terms of the product itself. So, I thought, “Hey, maybe if let’s say I jumped into this industry, I should be able to know how to create a product or how to discern a product that is probably better than everything else in the market”. So, that’s what gave me confidence to want to jump into this industry. And, I think across the globe, customers in general are always looking for better and better products. So we’ve seen that trend in mobile phones, how Nokia was the largest player for a long time, but customers switched in the end, right? And then, we were also seeing the same thing in content, how people used to rent DVDs, and now people are watching Netflix. So, I think across the globe in different industries, we can safely conclude that customers are always looking for better and better things. And, I believe the same about F&B too. And, that’s why we think there’s an opportunity for us to come into the market and win here.

Dewi Fabbri: That’s so true. So, walk us through the model. How does Hangry work and how are you different from other cloud kitchens in Indonesia?

Appeal to different palates with a wide variety of flavours

Dewi Fabbri: Abraham, it’s clear that you’re really tapping into this whole digital economy in Indonesia. And, the fact that so many Indonesians are tech-savvy and able to order their food via an app or online. Now, Aakash, let’s bring you in on the conversation here. When you first met Hangry in 2020, they had eight kitchens, I believe. And, now they have over 40 across Jakarta and Bandung. What excited you about this whole cloud kitchen scene in Indonesia, and in particular Hangry?

Aakash Kapoor: That’s right Dewi. They had eight kitchens and four brands. That’s what I recall. Let me start by saying it’s no secret that Indonesians love food. We picked up a few interesting facts over the last two years. One of them, for example, is one in three Indonesians snack more than twice a day. 30 to 40% of personal income is spent on food. Both of these translate to a large market of US$40 to US$50 billion market opportunity in F&B. Cut that to this decade now. And, you’d see that ride hailing has enabled the shift towards people caring, not necessarily about the location of the restaurant, but caring about the best food available at the best price. That’s where Hangry or models like Hangry come in. Specifically, when it came to Abraham and the Hangry team, what got us interested was if you talk to any of the consumers who’ve tried their food, you realise that people talk about the perfection that Hangry puts in into each of the recipes and each of the foods. For example, the crispiness of the Moon Chicken came up in many conversations. The freshness of San Gyu came about in many conversations. So, these are small things that Abraham and team have worked on, very important thing, small things, but very important things that Abraham and team have worked on, which as a result of these things Hangry has become a multi brand food retail company, on top of the cloud kitchens, powered by ride-hailing.

Dewi Fabbri: So Abraham, Aakash, you mentioned that you have four products. How did you choose these products?

Abraham Viktor: So, we tried to identify categories that we think are big. So, obviously there are so many categories of food. There’s fried chicken, there’s pizza, there’s burger, there are snacks, but not all categories are equal. So, what we consciously decided to do since the beginning is to identify categories that are very large and build brands that we think would win those categories. So, that’s why we have Moon Chicken, which is entering the fried chicken market, which is one of the most sizable, if not the most sizable category globally. And, we also have San Gyu, which is in the Japanese food category – also another genre of food that everyone across the globe loves. So, we try to enter those very large categories and the aim is to win those categories.

Aakash Kapoor: And, Dewi, if I may add, Abraham and team also have this concept of timeless categories. Categories that – or food items – that existed 10, not 20 years back and will continue to do this for another 10, 20, 30 years. Fried chicken is one example. I mean that existed 15, 20 years ago. It’s still going strong and will continue to go strong. That is another concept they have.

Taste and iterate: The Moon Chicken recipe for success

Dewi Fabbri: So, let’s take it back to Moon Chicken. That’s, if I may call it, your breakout brand, right? And, when it comes to chicken in Indonesia, it’s like every street there’s at least two Ayam Penyet stores. Is that why you specifically chose chicken? I mean, it’s universally loved throughout Indonesia. And, how are you making your chicken different?

Abraham Viktor: I love talking about Moon Chicken. It’s one of the brands that I really love personally. So, when we started thinking about Moon Chicken, I remember that we tried to [00:11:00] identify what makes a great fried chicken. And, when it comes to fried chicken, I think there are three elements, which is the chicken skin, and then the meat, and the seasoning, right? So, the skin has to always be crispy and the flavour has to penetrate to the bone, and the meat has to always be juicy.

So, what we had in mind is that we want to create something that should be great on its own but that in itself is not enough because we thought that if we were to come into the market, we have to come up with something that one-up the standard in the market. So, I remember that everyone else that we were speaking to at that time was telling us that their favourite chicken in the market are those off the top QSR (Quick Service Restaurant) chains. So, we did a couple of research on how we can make it even better. And in the end we decided that, first of all, we have to make sure that our chicken has to remain crispy after two hours because we’re a delivery-focussed player, meaning that people wouldn’t eat the chicken fresh from the fryer. And then, the second thing is we would like our chicken to be a little thinner in the skin. So, our chicken wings have thinner batter, and that allows for a crispier, more airy feeling when people bite into it. Now, the hardest part is, I mentioned earlier that I wanted to one-up the offering, right? So, instead of presenting our chicken naked, we decided to coat all our chickens in sauces and seasonings. And, that actually makes it very complicated because if the batter is more thin, but we douse it in sauce, it’s physically a bit impossible to make sure it remains crispy after two hours. That is why it actually costed us about three to four months to develop that recipe alone, that in the end, we were confident about.

Dewi Fabbri: So it took you like three months to develop the secret recipe behind Moon Chicken. Tell us about what does that entail in a day? How many chickens were you eating?

How the Hangry Academy sets outlet staff up for success

Dewi Fabbri: Let’s talk a little bit about that. What does Hangry Academy entail? When you go to Hangry Academy, what do you learn?

Count Your Chickens: Deciding on quantities with the help of technology

Dewi Fabbri: It’s a little bit like the Haidilao Academy, if I may say, where they bring people in and train them up to work in their restaurants, but Haidilao, they use a lot of tech behind the scenes. Is that something that Hangry is doing as well or planning to do, or currently does?

Be quick to respond to customer complaints

Aakash Kapoor: Dewi, you mentioned a critical part around tech and obviously the delivery partners, one other aspect of tech is that the delivery partners are critical to Hangry’s existence. But, at the same time, the brand is now maturing such that people are coming on to the app that Abraham and team have developed, and ordering food from there. And, many of the repeat users and many of the repeat customers prefer to just come on the app, and order food from there. And, on the app, they can choose various – either they can go to the kitchen and pick it up themselves, or otherwise order from the kitchen. So, I think that’s another aspect that in the last couple of years, the team has developed.

Entice your customers by nailing the basics and riding trends

Dewi Fabbri: Wow, that’s great. So, you really solve these customer’s pain points almost immediately, or rather within 10 minutes if they have any issues. So, apart from that, what are some other ways that Hangry is building affinity with their customers? How do you keep them coming back, apart from being delicious, and convenient, and quick to respond to any issues?

Customer complaints for breakfast: Team Hangry’s morning ritual

Dewi Fabbri: Wow. Samyang noodles and Moon Chicken sounds like a match made in heaven. Delicious heaven, really. So, it seems like attention to detail is behind [00:21:00] everything that Hangry does. You’re paying attention to your customers. You’re looking at this K-pop craze. Abraham, you are a year into your journey and you’ve built a loyal following among Indonesians in what’s a very competitive market. What advice would you give aspiring founders who are trying to break into a crowded space?

The key ingredients of building a brand

Dewi Fabbri: Wow, that’s for sure, a tough way to start the day, but very important. Even as you look at people saying negative things about you, that’s the only way to iterate and make your product better. Now, Aakash, as you look back on your experience over the last year with Hangry, what are the three most important things that they’ve done to break into a crowded market?

Aakash Kapoor: Well interestingly, it’s not very different from what you would hear on the internet or a tech company talk about. And, I’d say I’d rank these three things in the following order. First would be, at the time of product development, focus on making sure that you get the product right is very important. The more you iterate on it, the better each change should make it better for the customer. That would be number one, I’d say. Number two, consistency. Once you’ve developed a product, delivering consistent experience, consistent product, and then caring about the customer service is very important. That would be number two. I’d say third, brand is not built by spending dollars on marketing. Brand is built by how well you do the first two things. It’s how well you develop a product or how good a product you develop, and then how well do you take that product to market repeatedly back to the customers. I’d say third is brand building, but it’s a function of the first two.

Dewi Fabbri: Abraham, Aakash, it seems like the saying the way to a man’s heart is through his stomach holds true for Hangry. And, I can’t wait to see how many more Indonesians will become fans of the brand soon. Thank you both so much for joining us on the show today.

Abraham Viktor: Thank you Aakash and Dewi.