(8 September 1999 - Business Line)
On the old Prabhadevi Road in central Mumbai, DGP Enterprises chairman Dilip Piramal is
ensconced with his managing director A.G. Warey as they chalk out the strategic
imperatives to take the VIP brand to a whole new audience. Students and young
professionals are in the crosshairs as the concept of a hipper, trendier and more zingy
travel companion is being touted.
Meanwhile, Ahmedabad's Ashram Road has Nirma chairman Karsanbhai Patel in a huddle in his
third floor chamber with his senior management team evaluating the success logged by Nima
Rose soap, which was launched aggressively earlier this year. Nima Rose is being used as a
flanking device by Nirma as it taps smaller regional markets and stops rivals in their
tracks. In fact, the Nima brandname is now being used to sell detergent - cakes and powder
- as well as soap. The creation of a parallel brandname, a first for Nirma after years of
dominating the marketplace through umbrella branding, is already paying dividends.
In April 1998, Nirma turned the price-sensitive soap market on its head by launching Nirma
Lime Fresh. In a month, 17 million cakes were sold and, as Karsanbhai himself says, "My strategy is very clear - I will not launch a product without test-marketing it.
Further, I will not advertise till I launch the product. Remember that I am selling
mass-based, competitively-priced products." A high-decibel advertisement featuring
Ria Sen followed the Nirma Lime Fresh launch and the rest, as they say, is history.
Nirma, with a 38 per cent market-share in detergents (cake and powder) decided to add
value to its portfolio in 1992 by launching Nirma Beauty soap. Today it has an 18 per cent
marketshare in the soap segment. Nima Rose is already a market leader just as Nirma Lime
Fresh is. when Jai launched its lime variant, Nirma was quick to follow up its Nima Rose
brand with a lime variant. Nirma is the perfect story of brand-building. Karsanbhai says, "In the early 1980s, when television began to make inroads into rural and urban
India, Nirma would be one of the advertisers for the Sunday evening Hindi feature film.
But the positioning of the TVC (TV commercial) was such that the majority of the populace
thought the film was being sponsored by Nirma. This stood us in very good stead."
Similarly, overlooking the Arabian Sea in his Rang Sharda office in the western suburb of
Bandra in Mumbai, Marico Industries managing director Harsh Mariwala is putting the
tentpoles in place for his relaunch of Mediker, a brand acquired from Procter & Gamble
for Rs 10 crore. Companies armed with brands are resurgent on the stockmarkets. Marico,
with Parachute and Saffola, is the perfect example. Marico has very smartly used the
natural route to deliver promise. Mediker has been acquired as the group did not have a
serious medicated brand in the problem-solution area in hair care. A need gap has thus
Are brands enduring or ephemeral? Do they become part of a habit? Jagdeep Kapoor,
brand-builder and managing director of Samsika Marketing Consultants, reckons that serious
brand-building as a concept has emerged lately in India. He says, "Earlier people
would snigger at the thought of systemising the process, but now that
brand power has come through, good brand strategies will triumph in the
It must be mentioned here that India is a large market which consumes a wide array of
products. In fact, according to socioeconomic classification, there are 12 different
segments. There has to be a passion to build a brand, for it is very much akin to
nurturing a child or a plant, for that matter. A high level of involvement and marketing
discipline is required to shore up a brand. What's important here is that marketing has
different connotations for different organisations. Kapoor says, "It should be a
culture within the organisation. I have created what is called the land and brand module.
My contention being that, just as one invests in land, one invests in a brand. You have to
have a long-term vision in brand-building that remains the edifice. For instance, brands
like Navneet, that I thought had submerged, have been jumpstarted with the help of
external inputs. Restructuring of the product portfolio and repositioning the brand has
enabled it to grab marketshare and create a profile for itself."
Monginis, the franchise cake shops in Mumbai, have gone national very successfully using
Kapoor as the whet-stone. Over the last three and a half years Monginis has improved from
69 franchisees to 203 and the vision for 2002 is 1,000 shops.
Mariwala firmly claims that brand-building and survival in a free market depends not just
on which category you are operating in, but the presence of global brands in it and, most
importantly, the intensity of the battle. Take Coke and Pepsi, who with their deep pockets
view markets very, very passionately. Soft drinks, toothpastes, or shampoos are arenas in
which MNCS hold the cutting edge with a high decibel marketing. Mariwala says, "We
aren't vulnerable to that extent. While we are fighting MNCS, these are very much desi MNCS operating from within. At the end of the day one has to be insightful to capture the
consumer's interest and this should translate into brandworthiness."
Dilip Piramal reckons that the VIP brand was build on advertising, promotions and a
retailing thrust. "Yes, it was built from ground zero, but product quality has always
been an engine. Today Samsonite's presence does not deter me, for I have managed to
impact the top end of the market through better designing. In 1999-2000 VIP's adspend will
be close to Rs 20 crore."
At Marico the view is that, as the environment is constantly changing, opportunities
and competitive threats have to be absorbed. The challenge of change is what Mariwala is
guarding against. Branded coconut oil is a Rs 600 crore market, while the non-branded
market is valued at more or less the same. Parachute and its extensions are the market
leaders. Though there is competition from Shalimar in the east, Coco Care in the west, and
HLL'S Nihar, Marico has safeguarded its interests and share of the market by focusing on
advertising, sales and distribution. Marico's adspend is 7.2 per cent of its sales
turnover (Rs 551 crore in 1998-99). Nearly 50 per cent of Marico's sales come from
parachute and its extensions.
Kapoor maintains that brand-building is based on honesty, distribution, segmentation,
pricing strategy, perception management with advertising being a small component. "Brands live beyond human beings - they don't have just a personality, but longevity.
Brand management is an integrated process. One cannot live on past glory. It is a
consistent, persistent and insistent exercise."
Which is an interesting thought, for if you look at Thums-Up, Kissan, or Captain Cook,
they continue to do well despite having changed hands. But against that there are brands
which simply begin to fade for lack of nurturing and embellishment. If they are not made
contemporary and their perceived value is not cranked up and concurrently the consumer's
expectation level goes up a notch, they begin to get inundated. They begin to drift, then
languish. Examples that come to mind are Promise, Murphy and Rasna.
Marketers will tell you that one needs to be proactive in brand-building. Let us take the
case of Promise toothpaste, which in 1990 had a sizable 12 per cent marketshare, which was
incidentally better than HLL'S. But as HLL turned on the heat (see box), Promise
lost focus. As the freshness market in toothpaste started growing with the advent of
Close-Up, Balsara's Promise deviated from its given niche of being clove-dominated. It
started targeting freshness, a folly in the ultimate analysis. Things went wrong when it
was discovered that it was an undersupported category in terms of advertising and
marketing expenditure. Further, promise didn't have the ability to cross-subsidise in
terms of surplus cash. Colgate too faltered, reacting too late, not changing its
mix. Colgate Dental Cream was not bolstered at this vital juncture. A simple marketing
tenet is that, when you are battling for matketshare, the core business has to be
protected at all costs.
When HLL took on Nirma by launching Wheel, Rin and Surf were never neglected. On the
contrary, they were beefed up. Rajesh Jejurikar, general manager at Marico, states that
the core values of the brand have to be communicated efficiently at all times. That is one
of the reasons why Marico is using conquest, a consumer contact process, for constant
In toothpaste HLL was the aggressor and most proactive. Says general marketing manager
Mukul Deoras, "We cannot afford to be the followers. Brands don't happen; they have
to be clearly articulated with a relevant positioning strategy. Every single
element of the brand's attributes and mix reinforces it position consistently." Propositions have to be created as price points for brands are less elastic to changes
unlike commodities. Nirma is the finest example of price-sensitive products sweeping the
opposition. But HLL too has brands like Sunlight and Dalda, which not only became
irrelevant in their respective categories but couldn't transcend to the next level.
Against that you now notice that the commodity business is gradually turning into a
branded commodity business with the MNC marketers moving up the value chain. Cases in
point are HLL, Pillsbury and International Best Foods, who are battling for the branded aata
market. Niches are always easier to protect. The ayurvedic business, where MNCS cannot
bring in global muscle and leverage, is one example. But here too, brand-building is a
continuous process. Dabur and Himalayan Drug Company are relentless in this regard.
Of oral care and opportunity
A classic case of brand-building in recent memory is Hindustan Lever's imperatives and
intent in oral care, a market it has not only assiduously built over the last decade but
also made deep incursions into rival territory grabbing a substantial marketshare. The
toothpaste story begins in the late 1980s, when HLL had a marketshare of just 4-5 per cent
through two brands - Signal and Close-Up. It was at this point that HLL realised that a
huge need gap existed and the opportunity was staring it in the face. With oral care being
designated as an integral part of personal care, HLL made its strategic foray.
Concurrently, sweeping reforms were taking place and the third party manufacturing route
was available. The action plans was clear - relaunch Close-Up, delist signal, and
concentrate on building on brand.
Differentiation is a critical area in the consumer's mind. So HLL decided to be distinct
and attack with a genuine and unique selling proposition. Mukul Deoras, general marketing
manager for toothpaste and toothbrushes, says: "Everything about the new Close-Up was
different; it had functional attributes, brand benefits and brand personality. When the
world was full of white toothpastes, we offered the first gel, a spicy clove-based
toothpaste in a novel collapsible laminated tube with intrinsic characteristics offering
youthfulness and vibrancy."
Those were the days when tooth decay was top of mind in the oral care category, but
Close-Up's blueprint offering fresh breath and white teeth made a positive impact as it
targeted a spanking new audience - the 15-35 age group. Deoras claims that, through its
campaigns, HLL was now talking to the customer directly on a one to one basis. "When
Close-Up was first launched it was seen as an elitist, urban and westernised brand, but
during its successful relaunch it evolved and expressed itself into a fresh
breath-confidence booster mass-market brand."
This was the turning point as the brand property changed and a new segment was created.
Pertinently, the toothpaste market today is valued at Rs 1,780 crore. Colgate remains the
market leader with 51.1 per cent, but HLL is closing up with a 37.03 marketshare. The
evolution has been staggering - in 1990 HLL had a 10 per cent marketshare, which grew to
18 by 1995 and is currently pegged at 37 per cent.
|Oral care valuation for 1999
||Rs 1,780 crore
||Rs 462 crore
||Rs 390 crore
Once Close-Up started climbing, HLL felt health remained an important benefit segment. It
also felt that it had a large enough business to use as a springboard for the next step on
the ladder. A relaunch of Signal was seen as a case of carrying the baggage of the past.
Protection of the teeth thus became the focus area and 1993 saw Pepsodent being launched,
and once again it bridged the need gap effectively. Today, of HLL's 37.03 per cent
marketshare, Pepsodent-G, 2-in-1, and Advanced contribute 15.38 per cent.
The next level came when HLL decided to leverage toothpaste's brand equity in toothbrushes
and in this too it made rapid headway. Today the toothbrush market is valued at Rs 390
crore, of which HLL has a 25 per cent share. Interestingly enough, 20 per cent of the
total oral care business is in toothbrushes and HLL is now operating across all the price
The adspend in oral care is pegged at Rs 160 crore and HLL alone forks out a third of that
figure. The clinching fact, however, is that oral care is now contributing to the
juggernaut's bottomline in a big way.