Pitch Exclusive: In a liquid state
With low product differentiation and price sensitivity in the packaged water category, brands are focusing on getting the distribution right, while brand building has taken a backseat.
The bottled water industry is one of the country’s fastest-growing industries. It is worth Rs 2,200 crore and is growing at 40 per cent year on year. Currently, it constitutes 15 per cent of the overall packaged beverage industry. And that’s the reason, the category is witnessing huge action from marketers (both from organised and unorganised space).
Ajay Konale, Sr. Brand Manager, Still Beverages, Coca-Cola India says, “There’s a lot of latent potential in the India bottled water market and as an industry we have just about started to unlock the potential. The key to growth in this industry is to be able to provide the consumers with the product of their choice at the right place at the right time and at the right price.”
The packaged water business is divided broadly into two segments in terms of cost: premium natural mineral water and Packaged Drinking Water (also called table water). Premium natural mineral water is bottled at source, capturing all the natural minerals while Packaged Drinking Water is nothing but purified water. Booming Indian middle class characterized by disposable incomes and additional purchasing power has spurred consumption of this industry.
Place: the most important P
Consumers today have ‘on-the-go lifestyle’ and they look for hygienic drinking water. Thus, distribution of the product is the most important P for this category. The key to success is to make the roduct available at every distribution point right from high end malls to railway stations, bus stations, grocery stores and even local Paan kiosks. Availability is the key factor in the water segment since most retailers stock a single brand in their outlets. Abraham Koshy, Professor Marketing, IIM Ahmedabad, says, “The category survives on strong distribution network. If there is visibility, then a brand sells. There has to be availability of the product for it to win consumer’s confidence. Consumer is confident about a brand when there is visibility of the brand.”
However, the biggest challenge is that being a very heavy product, reaching every consumer when he demands the product is not an easy task. Anjana Ghosh, Director, Business Development, Bisleri International says, “Bisleri works on a model of putting up manufacturing plants closer to the market, so that the product can be placed on every shelf in that locality. We have 52 plants all over India, 3,000 vehicles, and around 2,500 strong sales force working in the market.” Apart from ensuring availability, this strategy also helps in bringing down high logistic costs and operations. A similar strategy is adopted by Bailley from Parle Agro. And while Bailley targets consumers across India, it has a stronger focus on Tier II and Tier III cities. Nadia Chauhan, Joint Managing Director & CMO, Parle Agro, says, “National players have plants in major towns and cities only where they have their bottling units. Bailley has plants in Tier II and Tier III cities as well. Consumers in these cities don’t have much of a choice and they have to compromise by consuming local brands.”
To capture a larger share of the market, Coca-Cola is distributing two packaged water brands: Kinley and BonAqua, both priced at par at Rs 15 per litre. Coca-Cola’s Konale explains, “Our flagship packaged water brand in India, Kinley, has done well in an extremely competitive segment. With the increase in on-the-go lifestyle, the market for packaged water category is growing extremely fast and there exists huge untapped potential. Hence, we have rolled out Bonaqua in select channels- convenience and organized retail to strengthen our leadership in the category.”
Low on advertising
The Table Water Category is very aggressive on price and thus the focus is less on advertising. Sample this: According to TAM Adex, in the year 2010, the total advertising hours on TV by this category was 280 hours which is a mere 0.1 per cent of the total TV advertising Volume of 2,26,506 in the same year. Ambi MG Parameswaran, Executive Director & CEO, DraftFCB+ Ulka says, “Bottled water brands have been caught in price wars that reduce their margins, as a result they have not had the money to do serious brand building like advertising. If they succeed in moving consumers up to premium water, or spring water, then they will have the margins to invest in advertising.”
The brands from Coca Cola and PepsiCo: Kinley and Aquafina are the two brands that advertise in the media as they focus on building brand value and brand recall. Kinley from Coca-Cola has positioned itself on trust and the campaign, “Boond Boond Mein Vishwas” focused on the same. “Kinley brand personifies trust, which is a key attribute in the packaged drinking water segment. Our product attribute matched with the brand positioning is a key reason that the brand has done so well in market despite aggressive and often low priced competitors,” says Konale.
Taking the same idea of trust to the next level, Kinley launched, the ‘Vishwas Karo’ campaign a few years back, which urged consumers to choose trust and give trust a chance to transform their lives. The campaign was very successful and had played a key role in establishing Kinley as a trustworthy brand in the consumer’s mind. PepsiCo’s Aquafina, on the other hand, has positioned itself as a modern and youthful product. A brand expert, requesting anonymity, doesn’t understand how a youthful imagery can help a brand operating the packaged water category. “Maybe, Pepsico has done it, because, as group it has a youth focus. But I don’t see that helping them in this category,” he says.
Himalayan, from Tata Global Bevereges has positioned itself as a lifestyle brand has adopted the premium pricing strategy. Bisleri, which is the leader in the category with a market share of 60 per cent, does not believe in advertising as it has the first movers’ advantage. As Koshy says, Bisleri, which has been in the industry for a long time now and probably is the first player in the category, has won the consumer’s confidence and hence doesn’t advertise. Bisleri’s Ghosh believes that Bisleri has become a generic word for packaging water. “Every bottled water in India is sold as Bisleri. And that’s our target market - every consumer, who want to drink pure and safe water,” she says.
Segmentation
Experts feel that water is a category where there is very low scope of differentiation in terms of product, yet brands have managed to segment the category. And so we have: Premium Natural Mineral Water and Packaged Drinking Water. However, the packaged Drinking Water still dominates this category with 90 per cent share, while the mineral water segment contributes 10 per cent. There have been a few players getting into the tonic water and flavoured water space too.
The natural mineral water brands are priced between Rs 30 and Rs 50 and key brands in this space are Qua, Bisleri Vedica, Himalayan and Catch. Parmeswaram feels, “The more exciting game is being played out in the spring water space. Here, marketers have the option of charging a premium and make sure that sufficient investment is made on brand building. Himalayan is a brand that has a good chance of taking early lead in this space. It remains to be seen if they can justify the premium to Indian consumers who are intrinsically value driven.”
Ghosh too believes that Natural Mineral water is an emerging/evolving product. “It’s an aspirational product. Like a consumer aspires to move from a medium sized and low priced vehicle to a bigger car and more expensive car, it’s the same in Natural Mineral water. Consumers want to move from a bottled water to a more premium water, and we are observing a natural shift,” she adds.
However, there are certain challenges in marketing the premium natural mineral water. Retailers are not very keen on stocking these brands as the volumes are low. Also, freight costs are high in this segment as the water is sourced from the mountains. Ghosh says, “There is no major challenge in marketing Vedica, except for transporting it from the Himalayas (Uttarakhand) to various part of the country. Vedica is growing at a pace of 50 to 60 per cent but the base is very small as yet.”
Some brands are using different distribution system for marketing premium natural mineral water. For instance, for Himalayan, the distribution is handled by Nourishco a joint venture between the Tata Global Beverages and Pepsico. Pepsi uses the Tropicana Juice distribution network to distribute Himalayan, which is different from the distribution network used for Aquafina, the mass brand. Similarly, Qua the Narang Group’s premium narural water is distributed through the network used for energy drink Red Bull (also distributed by the Naranag group).
Meanwhile, the key players in the tonic water are Dharmpal Satyapal Group (Catch) and Catch Coca-Cola India (Schweppes). In the flavoured water segment, Catch Clear is the only player. Catch Clear flavoured water is actually a combination of sparkling spring water and natural fruit flavor, which is low on calories. Catch Beverages is targetting the high end consumers and that’s why the focus on niche products like tonic and flavoured water. As Puesh Gupta, Director, Dharampal Satyapal, says, “Catch Beverages, bottled at the source in Himalayas, is meant for the niche and high end customers. The different flavours and the categories have been developed keeping in mind, the well travelled, health conscious niche customer.”
For Indian consumers to develop the taste and liking for tonic water or flavoured water, it may take some time. Key players like Bisleri, Pepsico, Parle Agro and Tata Global Beverages don’t have any product in the niche segment like tonic or flavoured water. Parle Agro’s Chauhan feels, “While the water industry is large in size and growing at a good rate, it is still at a nascent stage.”
However, the biggest challenge for the category is battling the unorganised players. As per Neilson data, almost 70 per cent of the entire bottled water industry is unorganised. As these unorganised players offer higher margins, the retailers also push these local brands. And this product being an impulse purchase, consumers also tend to take what is pushed by the retailer. Another challenge for this industry in the future may come from the debate on eco-friendliness or the eco-non-friendliness of bottled water as a category. But that movement is yet to rear its green head in India.
(With inputs from Purba Das)
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Social Beat wins SEO mandate of Tata CLiQ tag rss
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ShareWill OOH dazzle this festive season?
As the celebrations begin, experts tell us the trends and challenges for the OOH sector this season
Be it the flower-clad taxis in Mumbai for Made in Heaven Season 2 promotion or Zomato’s ‘kheer mangoge kheer denge’ billboards, India's OOH advertising sector has undergone substantial transformation and expansion in the recent years. Even though the medium was severely hit during the pandemic years, it has now managed to rebuild its status. Now, with the onset of the festive season, elections and the cricket world cup, OOH is expected to see more and more advertisers come on board.
Amarjeet Hudda, Chief Operating Officer, Laqshya Media Group, believes most of the clients spend a lot of money during the festive season, especially for Durga Puja, Dussehra and Diwali, targeting their customers in a festive mood. The categories that spend heavily during these months are Auto, Consumer Durables, Real Estate, Organised retail, and E-commerce.
According to Dipankar Sanyal of Platinum Outdoor, there was a huge surge in the festive season last year, and he expects the same this year too. “Last four to five years have turbulent for outdoor. It was picking up in 2019, but then Covid came and everything went flat for two years,” he mentioned.
According to EY-FICCI’s M&E Report 2023, OOH media grew 86 percent in 2022 to Rs 37 billion. The value includes traditional, transit and digital media, but excludes untracked unorganised OOH media such as wall paintings, billboards, ambient media, storefronts, proxy advertising.
Sharing the brand’s perspective, Shivam Ranjan, Head of Marketing, Motorola-APAC, said, “We are going into this festive season with a strong mix of media, including OOH. Within OOH, we are focusing on digital OOH, due to its capability of programmatic serving, measurability, and near real-time insights that allow us to be agile with the communication and optimisation of our campaigns.”
With urbanisation, improved infrastructure, rising consumerism and an increased spending power, clients' expectations from OOH advertising too have evolved. “The clients expect better ROI on every investment, best in class innovations, tech-led planning and execution. Today, technology plays an important role starting from planning the campaign, to measuring metrics to ROI,” Singh explained.
Another trend that Sanyal has observed is that traditionally advertisers looked at spending on OOH nearly two weeks prior to the festivities, but now, most advertisers have now started advertising a week earlier so that they can get maximum eyeballs. Additionally, the digital OOH advertising (DOOH) has also emerged big. The digital OOH screens increased to around 100,000 and contributed eight percent of total segment revenues.
“Now with digital, there is more space for advertisers to come in one frame. Because of this, you can see it is getting more attractive. The innovations too are coming in at a much lower cost and creating a greater impact,” shared Sanyal.
The only challenge with the medium, according to Ranjan, is OOH being a fragmented industry with lack of measurability and agility. This becomes a serious issue for ROI-centric brands. However, the growth of DOOH, which is dynamic, agile and measurable, is giving marketers the confidence to invest in the medium backed by relevant data and outcomes.
Adding to this, Hudda highlighted that availability of good media spots is the biggest challenge in this season as media assets are limited and demand is very high. Due to the gap in the festive season, many clients are not able to fully optimise their campaigns. Rather sometimes, clients are even compelled to divert their budget which adversely impacts the industry, he shared.
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Banking on positive consumer sentiment: BFSI optimistic on doubling festive AdEx : Cache
Some categories within the sector, however, may spend more in the quarter that follows the festive season
The BFSI sector is expecting a surge in demand for loan during the festive season and is looking at increasing its ad spends to cash in on the celebration spirit. Industry leaders say they are hopeful of witnessing a good growth in the number of applications for auto loan, home loan, credit card and health insurance during October, November and December due to positive consumer sentiment this year. However, though most of the BFSI players are planning to double their advertising budget this time compared to the previous year, there are some who are not investing too heavily on marketing during the festivals as they plan to save the money for the fourth quarter.
According to Shailendra Singh, MD & CEO, BOB Financial, they witness incremental growth every year during the October-December quarter, and they anticipate an increase in consumer spending as well as new enrolments for cards this year too. “There remains a surge in customer demand for credit during the festive season,” said Singh.
Singh shared that the company is fully geared up for the launch of #FestiveShoppingRewards on all Bank of Baroda credit card variants under the theme ‘Reimagine Festivities’. They would kickstart festive offerings with the start of Navratri.
The festive season does not just see the demand for credit go up, but there is an increase in applications for health and motor insurance too during this time of the year.
Aabhinna Suresh Khare, Chief Digital & Marketing Officer, BajajCapital Ltd, shared that among insurance products, health insurance and motor insurance reign supreme during festivals. According to Khare, the demand for mutual funds and SIPs too sees a hike.
“Overall, the festive season presents an opportune moment to secure insurance coverage. A plethora of attractive products and services are on offer, with financial institutions extending special discounts and promotions to entice new customers,” said Khare.
The company launched #BlessMeGanesha campaign during Ganesh Chaturthi. “Our goal for this festive season is not only to provide financial solutions but also to create memorable experiences and deepen the connection with our customers,” said Khare.
Though all major sectors spend heavily on advertising during the festive season, within the BFSI sector, some categories spend more in the quarter that follows the festive season.
Explaining the trend, Samir Sethi, Head of Brand Marketing, Policybazaar.com, said that the festive season has varying impacts on the BFSI sector. In the banking sector, for instance, the demand for loans surges as many individuals purchase items and undertake home renovations. Conversely, in the insurance category, the festive season doesn't result in significant changes. Instead, the insurance industry experiences its peak season after the festive period, particularly during the fourth quarter of the financial year.
“As the festive season approaches, there is a noticeable increase in car sales though, leading to a surge in the demand for motor insurance. Consequently, we see a significant uptick in the requests for motor insurance policies. During the festive period, there is an upswing in demand for various categories, such as electronics. However, in the insurance sector, this period doesn't significantly affect us, so we don't run specific campaigns targeting festivals. Nevertheless, we do roll out multiple campaigns throughout the year, and some of them may coincide with the festive season,” said Sethi.
According to the TAM AdEx report on BFSI sector across media for H1, the advertising volume of the sector grew on TV, radio and digital, but declined in the print medium. The report indicated that ad impressions on digital saw 91% rise during Jan-Jun '23 over Jan-Jun’22. The increase was 32% for radio and 4% for TV. The ad space of the BFSI sector decreased by 7% in print.
Speaking on media mix, Singh shared that BOB Financial has a good mix of customer segments belonging to Tier I, II and III. So, understanding their needs and preferred form of media channels, the company will reach out to them through relevant media promotions. “For the easy discovery of our offers, we shall have a dedicated offers page with regular promotion of top offers on our social media and other digital channels,” said Singh. Without disclosing the figure, Singh shared that the company’s promotion budget has surely increased from last year and it will be visible through their multi-channel promotional activities.
According to the TAM report, in the BFSI sector, life insurance is the leading category on TV and radio whereas mutual funds is the top category on digital.
Khare highlighted that in recent times, Bajaj Capital has observed a significant growth in audiences on online platforms and the changing preferences of their clientele. “This observation led us to recalibrate our marketing approach, placing a heightened emphasis on digital avenues,” said Khare.
He further added, “Our promotional efforts are primarily digital-focused, accentuating areas like social media engagement, search engine outreach, content-driven marketing, and targeted online advertising. As we approach the festive season, we've fine-tuned our online approach. By harnessing the insights from data analytics, we aim to grasp our clients' needs and inclinations better, ensuring our content is both tailored and pertinent.”
Khare also mentioned that Baja Capital has doubled its advertising budget compared to the previous year.
“This increase in our ad spend signifies our confidence in the opportunities this festive season presents. This impressive surge in our budget allocation underscores our dedication to maximizing the potential of this festive season and driving significant expansion within our business. We firmly believe that this increased investment in advertising will not only elevate our brand presence but also lead to an exceptional uptick in customer engagement and sales.”
For Policybazaar.com, the media strategy primarily involves a blend of television and digital platforms, an approach that has remained consistent in recent years and is expected to continue in the foreseeable future.
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OMD appoints Dileep Raj Singh as Head of Digital for APAC
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“It is our global ambition to continue our leadership position in digital, data and technology. In line with this ambition, we are excited to have Singh come on board the OMD APAC leadership team. His background of agency, in-house and start-up experience position him perfectly to understand and address our clients’ business needs,” added Lee.
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Singh will report to Lee, and work closely with the team including Chief Strategy Officer (CSO), David McCallen, and Chief Client Officer (CCO), Sadhan Mishra, to drive and support APAC local markets as well as regional clients on digital, data and technology needs.
Mishra was promoted to CCO of OMD APAC recently in June 2023. He will continue to be CEO of OMD Singapore, a position he was promoted into last August. Mishra has been with OMD for over 13 years and in his concurrent new role as CCO, he will focus on key client relationships, understanding their business needs and ensuring we remain a critical partner on their transformation journeys.
McCallen was elevated to the role of CSO of OMD APAC in April 2022, and was previously the CSO of OMD New Zealand for five years where he helped the agency to attain the top place in the market for new business, overall billings and award wins. Since starting in the APAC role, his focus has been on connecting and elevating strategic best practices across the region, building capabilities across a range of strategic outputs, and supporting new business growth both regionally and locally.
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Chandrayaan 3: Brands over the Moon
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BCCI rakes in Rs 4670 cr in Women's Premier League team auction: Jay Shah 26 Jan
WPL has broken the inaugural auction record of Men's IPL in 2008, tweeted Shah
As expected, Wednesday turned out to be another historic day in Indian women's cricket with BCCI having a windfall gain of Rs 4,600 crores by auctioning five team franchises for the first season, a higher sum compared to what men’s IPL franchises offered to the cricket body during the launch in 2008.
Adani, IndiaWin Sports, Royal Challengers, GSW- GMR cricket and Capri Global have won the bid, BCCI secretary Jay Shah tweeted.
Shah shared in a series of tweets, “Today is a historic day in cricket as the bidding for teams of inaugural #WPL broke the records of the inaugural Men's IPL in 2008! Congratulations to the winners as we garnered Rs.4669.99 Cr in total bid.”
“This marks the beginning of a revolution in women's cricket and paves the way for a transformative journey ahead not only for our women cricketers but for the entire sports fraternity. The #WPL would bring necessary reforms in women's cricket and would ensure an all-encompassing ecosystem that benefits each and every stakeholder.”
“The @BCCI has named the league - Women's Premier League (WPL). Let the journey begin…”
The country's top corporates had bid aggressively for the league. Over 16 groups including IPL franchise owners, Adani group, Torrent and Haldiram were believed to be in the fray.
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The BCCI was reportedly expecting ₹4,000 crore gain through team auction.
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