Marketing review

11 Dec 2003

Swatch to scale up brand presence in India
The Swatch group is planning to expand its presence in India in 2004 by introducing two new brands of watches and increasing investment in its existing brands. The two new brands, to be launched in January 2004, will include Flik Flak, a brand targeted at kids and priced at Rs 2,000 onwards, and another in the price range of Rs 4,000-7,000.

The group has five brands — Rado, Longines, Swatch, Tissot and Omega — in the country. The company said it will scale up its investment in marketing and advertising activities by 30-40 per cent next year which would include signing up a new brand ambassador for Omega. Further, the company also intends to set up exclusive outlets for Omega. The group recently launched the Sintra Superjubile collection under its Rado brand. The new collection, which is inlaid with precious stones, is priced at Rs 1.38 lakh onwards for the ladies watch and Rs 1.90 lakh onwards for the men's one.

Samsung to stress on after-sales service
Samsung India Electronics Ltd (SIEL) has launched its 3S — speed, smile and sure — campaign, which will stress on after-sales service. As part of this customer service programme, the company is working on a two-pronged strategy, which involves improving the service infrastructure by setting up customer service plazas in key metro locations, and improving the skill levels of technicians by setting up a training school with a technical evaluation system for after-sales service engineers.

Company officials say with the competition increasing, customer satisfaction is fast becoming a core issue and Samsung's present effort will strengthen its customer base as most of the players say 60 per cent of their sales is repeat purchase.

Dabon to offer ghee
Dabon International Pvt Ltd, a 50:50 joint venture company between Dabur India and French dairy major Bongrain SA, has launched ghee under the same name as Dabon's processed cheese brand — Le Bon. Initially the company will source the basic product from Belgium-based dairy company SA Corman and will later consider setting up an independent manufacturing unit in India but that is if the volumes grow. The organised ghee market in India is estimated at 1.5 lakh tonnes. Le Bon ghee, positioned on the health plank, is priced at Rs 145 for a 500-ml tin. The product claims to have 80 per cent less cholesterol than conventional ghee.

The company claims it has made use of 'de-cholesterolised technology' to remove 80 per cent cholesterol from the ghee. Le Bon ghee has been rolled out in Maharashtra and will be launched in other cities subsequently. Dabon's presence in India is marked by processed cheese, cheese spreads and slices. The domestic processed cheese market is estimated at Rs 250 crore, led by Gujarat Cooperative Milk Marketing Federation's Amul and followed by Britannia. Le Bon's sales are estimated at 250 tonnes. After ghee, Dabon proposes to enter the branded paneer market by early next year.

Agro Tech launches Corn Chips, Potato Popz
Agro Tech Foods (ATFL) has augmented its Act II brand portfolio with the launch of two new snack food products — Corn Chips and Potato Popz — and is hoping that these new launches will increase its 5-per cent share of the Rs 1,200-crore ready-to-eat foods market. Officials sources say the company is looking at a turnover of between Rs 35 crore and Rs 40 crore by 2005-06 from ready-to-eat foods.

The company is test-marketing the new products in Pune and Karnataka and will launch them in other centres very soon. Corn Chips come in two flavours, Tangy Masala and Nacho Cheese, while the three-dimensional star-shaped Potato Popz are being marketed in plain-salted and tangy tomato flavours in Rs 5 and Rs 10 packs.

LVMH to expand luxury goods range
LMVH, the euro 13-billion French luxury goods-maker, plans to add three of its most exclusive brands — Fendi, Zenith and Ebel — to its existing portfolio of luxury brands, Tag Heuer, Louis Vuitton, Christian Dior, Dom Perignon and Moet Chandon among others, positioned at the premium and super-premium end of lifestyle products in India. The French company is also increasing its marketing budget for the next year — an amount comprising 40-50 per cent of sales for Tag Heuer. The company says according to its estimates, growth at the top end of the Indian market has been in excess of 250 per cent in the last few years, making it a critical market for the company.

Next month the company will launch the Fendi brand, which comprises ready-to-wear items, leather goods, accessories and fragrances. Fendi will be priced in the range of Rs 10,000-50,000, just below Louis Vuitton. The Ebel brand comprising watches and chronographs will be in the price bracket of Rs 50,000 to Rs 2 lakh while Zenith will be at the top end and is the only Swiss watch brand that has no component outsourced and is renowned for its precision. Zenith will be priced upwards of Rs 5 lakh apiece. The company has signed Shah Rukh Khan as its brand ambassador for Tag Heuer watches.

Godrej relaunches Fairglow soap
Godrej Consumer Products (GCPL), planning to give a keen competition to Hindustan Lever's Fair & Lovely fairness creams, has re-launched its Fairglow toilet soap. This is yet another instance of cross-category targeting in the Indian personal care products market. Earlier HLL had launched the Unilever product Dove Soap, which targeted the moisturising lotions market.

Godrej Consumer Products hopes to double its turnover from Fairglow from the current Rs 60 crore to Rs 120 crore in the first year of the re-launch. The entire toilet soaps market is estimated at a whopping Rs 4,500 crore with a yearly volume of around 5 lakh tonnes.

BPL budgets Rs 60 crore for ad campaign
Domestic consumer electronics major BPL Ltd has planned Rs 60 crore in advertising and marketing expenses for its colour televisions business in the next fiscal. This is to counter the intense competition from companies like LG and Samsung, which dominate the CTV market now.

Two years ago BPL had the highest share in the CTV market in the country when the company's financial restructuring prompted by mounting debts resulted in serious marketing and production constraints. LG's ad budget is estimated to be about Rs 45 crore while Samsung's spend is at Rs 52 crore. Both the Korean companies are the leaders in the CTV industry, at present both selling well over 1-lakh units monthly.

InterGold to open new outlets
InterGold Gems, the Indian subsidiary of the world's largest diamond manufacturing company RosyBlue Inc, is expanding its presence in India. The company is setting up new outlets and upgrading its manufacturing facilities in the country and has budgeted Rs 60 crore for all this. At present the company has 22 showrooms all over the country, including Chandigarh, Mumbai, Delhi, Goa, Hyderabad and Chennai.

InterGol's expansion plans are especially focused on the north and it plans to open outlets in Amritsar, Ludhiana and Jullundhar as it views these cities as lucrative markets. The northern cities contributed about 30-35 per cent of the company's revenues last year. Intergold is the only jewellery company to be associated with leading three bodies — Diamond Trading Company (DTC), World Gold Council and Platinum Guild International.

Pillsbury re-launches cake mixes
General Mills India has decided to re-launch its ready-to-bake cake mixes in two flavours — rich chocolate and vanilla. The re-launched pack comes in two recipes and offers consumers the flexibility to bake the cake either with or without eggs.

The company will ensure that the two international flavours will be available in all the metros of the country in time for Christmas and New Year celebrations. The product will be available in super markets and general stores in Mumbai, Pune, Delhi, Chennai, Bangalore, Kochi, Hyderabad and Kolkata this festive season.

SET hits jackpot with Jassi
Sony Entertainment Television (SET) seems to have hit the jackpot. After trailing uncomfortably behind Star Plus in television rating points (TRPs) in daily soaps for the last couple of years SET is now inching closer to Star Plus's TRPs with its soap Jassi Jaissi Koi Nahin. The serial has given SET a hefty increase in prime time viewership and a 30-40 per cent growth in advertisement revenue. According to the latest TAM data, SET's average slot share at the prime time slot 9:30 pm to 10 pm (when Jassi is on air) zoomed to 31 per cent during week 9-12 (October-end to mid-November) of Jassi's launch from 8.2 per cent pre-Jassi.

Simultaneously, Star Plus saw a sharp dip in average slot share from 81.8 per cent in pre-Jassi days to 56.3 per cent in November-December. Taking November as a whole SET's prime time (8-11 pm) market share zoomed to 20.3 per cent from an average 14.9 per cent in April-June, representing a growth of over 36 per cent. Its average market share in October stood at 18.8 per cent. Star Plus, on the other hand, has seen a 7.5 per cent drop in prime time market share from an average of around 69 per cent in the April-June quarter to 63.7 per cent in November.

Deepak Fertilisers plans speciality mall in Pune
Petrochemicals company Deepak Fertiliser and Petrochemicals Corporation is foraying into the services sector and is planning to set up speciality malls for interior and exterior spaces in Pune. The company has initiated the venture under the name of Urban Spaces in Pune and plans to replicate it in other parts of the country also. Deepak Fertiliser will be investing Rs 100 crore, which is expected to bring designers, architects, engineers, consultants, landscape developers under one roof to cater to the needs of offices, residential as well as malls or multiplexes.

Construction on the mall will begin in March 2004 and will take 18-20 months to complete the entire work. The speciality mall will be spread over 5 lakh square feet across 10 acres of land and the mall will not only display leading domestic players but also international product and services. The mall will display a plethora of products from glazing, flooring, furniture, furbishing, hi-tech consumer electronic white goods, lighting and acoustics reaching up to art and sculpture.

CNBC-TV18 to expand to smaller cities
CNBC-TV18, the business television channel of CNBC India, is planning to widen its reach to smaller cities across the country. At present the channel is considered to be metro-centric. In the first phase, CNBC-TV18 will focus on smaller cities including those in South India. The company will invest Rs 5 crore during the next one year in infrastructure and recruitment.

Initially CNBC will begin operations in Hyderabad, Coimbatore, Kochi and Ahmedabad with new infrastructure and bureaus. This will be extended to other cities such as Surat, Pune and Vadodara in the next two-three years. The channel is at present strengthening its staff strength in Mumbai and Bangalore and is also in the process of making its presence more felt in Kolkata and Chennai. The channel bagged 120 advertisers during the last year, helping it to its target of Rs 48 crore advertising revenue by the end of this fiscal against Rs 38 crore earned in the last fiscal.

Cola majors plan for a hectic season next year
Softdrink majors PepsiCo and Coca-Cola have begun making pans for the coming summer and are targeting two-to-three times more volume sales. Bottlers of the two companies reveal that the cola majors have lined up major expansion plans for 2004 and are either adding new lines to their existing bottling units or setting up green field facilities.

Coca-Cola has lined up major investments in increasing line capacity this year and is planning to penetrate deeper into rural markets. Bottlers say both the soft drink companies have plans to increase volumes by at least two-three times next year to make up for the small margins on smaller 200 ml bottles, which are expected to replace the bigger 300ml bottles almost completely in another two years. The smaller packs are expected to help the companies increase their presence in rural markets, and generate higher repeat consumption.

— Compiled by Mohini Bhatnagar