Indian Brands Striving to Make Comeback
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International Conference on Management and Information Systems September 22-24, 2013 Indian Brands Striving to Make Comeback Rhizu Krishna Misra [email protected] Sinhgad Institute of Business Management, Mumbai Once a brand achieves a lot of success in the market and becomes a star, what makes it to lose its sheen? How the once the star brand strive to make a successful come back. This article seeks to explore and answer why a successful brand of the past Afghan Snow and Paan Pasand lost their market share and how they are developing to make the comeback in the one of the rapidly growing market of the Globe i.e. India. Brand Managers may find the factors responsible for fading of this shining star useful while estimating their own brands for any possible threats. Keywords: Brand Revival, Brand Failure, Brand Promotion 1. Introduction The name India reminds us of the vibrancy different culture, different religions, different people, different caste, and different festivals and different believes in different states. In a nutshell we can say Unity in Diversity. But the country has vast history and looking India in the 19th century it can be divided into two categories first Pre-Republic Era and Post-Republic Era. Second category in Post-Republic era can be Pre-economic liberalization Era and Post- economic liberalization era. Pre-Republic era the Indian Economy was based more on agriculture and manufacturing. In Post- Republic era economy was shifting from agriculture to manufacturing and services. The industries in this era were mainly dominated by the public sector unit and few private players. Very few players were competing at the global level. This was the pre-liberalization era. After 1991 Indian economy was liberalized to the foreign player. Licensing raj had gone and manufactures were given freedom to produce and increase their production capacity. This led to more intense competition which in turn became beneficial to the customers. As the result product quality had improved at the more economical prices. This competition brings in benefits to customer but forced few firm to struggle for their survival reminding the theory of “Survival of the fittest”. 2. Ravalgaon Paan Pasand ''Paan ka Swad, Ghazab ki Mithaas” In the year 1986 an advertisement was aired in which the actor says the dialogue in angry mood and then after having Paan Pasand the same dialogue was repeated in a mild tone. This advertisement became the talk of the town. Everybody use to say the dialogue twice once in anger tone and then in mild tone. The product had broken the conventional line of thought by introducing the candy for adults. 3. About the Company The Ravalgaon Sugar Farm Ltd. is one of the leading houses in the Indian Sugar and Confectionery industry with an annual Sales Turnover of INR 1024 million (US $ 22 million). The Ravalgaon Sugar Farm was incorporated in 1933 as part of the Walchand Group but operates independently today. The Confectionery Division was started in 1942. Ravalgaon is a household name in India and has been very popular in creating sweets with an "ethnic flavour". Mango Mood (with natural mango pulp), Paan Pasand Gold, Kokonut (grated coconut), Cherries (fruit flavors) are the few famous brands. The Company's registered office and manufacturing facilities are situated in Ravalgaon, in the Nasik district of Maharashtra. 4. About the Founder Mr. Seth Walchand Hirachand In 1923, Mr. Seth Walchand Hirachand, an ambitious industrialist, arrived in Ravalgaon with the belief that India could improve its economic condition and free itself of colonial exploitation if it developed its own industries using modern technology. He realized that agriculture, India‟s single largest industry, would have to partake in this revolution. He bought 1,500 acres of barren land and set about clearing it of rocks and stones, replacing them with fertile soil. He engaged the services of experienced agriculturists, chemists and engineers. After a decade of persistence, he developed sugarcane in the region and erected one of India‟s first sugar mills. Around this mill rose a township that provided healthcare, education and employment to an otherwise remote, rural community. ISBN 978-81-924713-4-1 216 International Conference on Management and Information Systems September 22-24, 2013 Mr. Seth Walchand earned his stripes in construction, taking on some of the most challenging projects at the time. Those early successes laid the foundations for the Hindustan Construction Company, which today includes amongst its many accomplishments the Bandra-Worli Sea Link in Mumbai and the model township of Lavasa near Pune, and the Indian Hume Pipe Limited. Another of his ambitions was to see ships, planes and cars being built in India by its own people. He set up Hindustan Aircraft Company in 1940 and a shipyard in 1946 in Vishakhapatnam. Both of these were deemed so strategically important that they were later nationalized and renamed Hindustan Aeronautics Limited and Hindustan Shipyard Limited, respectively. The Premier Automobiles Limited rolled out its first trucks and cars in 1947, the year of India‟s independence. Even today the ubiquitous and iconic Premier Padmani, or Fiat, dots the streets of Mumbai as yellow-roofed taxis. 5. Confectionery Division The Confectionery Division makes hard-boiled sweets and toffees under the Ravalgaon brand. Innovative and timeless products, including Paan Pasand, Mango Mood, Cheery and many others, are marketed throughout India, and are available in traditional and modern trade retail outlets. The state-of-the-art factory has multiple high-speed cooking, forming and packaging lines for hard-boiled sweets and toffees. Hard-boiled sweets are die-formed, with the option of soft center fillings. They are wrapped using double- twist, single-twist and flow pack (pillow pouch) techniques. Toffees are cut and wrapped with double-twist wrapping. 6. Brand Paan Pasand Origin and history of Mouth Freshener Mouth Freshener is being used in India since pre-Harappan period (circa 3000-1500 BC) with the name of “M ukhwas”. It was used after meal for freshening mouth and breath as well as for digestion. It has been mentioned in Sanskrit as Mukhwas, in which “Mukh” means mouth and “Was” means smell. Mouth Freshener is usually taken after the meal to fresh the mouth as well as breath. Apart from this, Indian mouth freshener is being used as a digestive aid. When you chew mouth freshener, it releases the saliva, which is helpful in digesting the food. Paan (Tambool in Sanskrit and Betel leaf in English) had been accepted as the best Mouth Freshener after the meal. This quality of Paan might have forced the Ravalgaon‟s Paan Pasand quality team in the year 1980 to come up with product under this category which was for adult in a candy shape. The product had a flavour of mint finish to it. 7. Paan Pasand in Pre Economic Liberalization Era in India The product was leader in the market during that era (1981-1990) because of the following reasons: Uniqueness of the product: The product had the flavour of Paan in candy form and for the adults. Advertisement of the Product: The advertisement was conceptualized by Mr. Gopi Kukde a veteran of the Indian advertising industry. The advertisement didn‟t take much time to become the talk of the town. Few players in the market: In pre-liberalization era there were restrictions for the Multi-National Companies to enter the Indian market. The major players were the Indian manufacturers only in the confectionery sector. 8. Losing Ground (Post economic liberalization era in India) Once the markets were open for the MNC‟s the struggle for the Indian brand started. The reasons for the struggle were as follows: Major Player in the Confectionery Segment: 1. Cadbury India Ltd., is the largest manufacturer of chocolate, confectionery and malted food products. 2. Nestle India Ltd., is a manufacturer and marketer of coffee, tea, malted beverages, instant baby cereals & foods, milk products, chocolates and confectionery, instant foods and culinary products. 3. Lotte India Corporation Ltd., is primarily a manufacturer and marketer of sugar boiled confectionery, cocoa and milk based toffees, candies and mints. 4. Nutrine Confectionery Co. Pvt. Ltd., is a manufacturer and marketer of sugar boiled confectionery, cocoa & milk based toffees, candies, éclairs and fruit bars. 5. Candico India Ltd., is a manufacturer and marketer of sugar boiled confectionery, candies, gums, mints and toffees. They are also the largest contract manufacturer for various Indian and overseas confectionery companies. 6. Perfetti Van Melle India Ltd., is a manufacturer and marketer of sugar based confectionery and is a leader in the candy and gum segments of the confectionery market. ISBN 978-81-924713-4-1 217 International Conference on Management and Information Systems September 22-24, 2013 7. Parle Products Pvt. Ltd., is a manufacturer and marketer of cookies, sugar boiled confectionery, and cocoa and milk based toffees. 8. Wrigley India Pvt. Ltd., is a manufacturer and marketer of chewing gum (Wrigley brands) and sugar based confectionery, bubble gum, chewing gum and candy (Joy co brands). 9. GCMMF (Gujarat Cooperative Milk Marketing Federation), is India's largest food products marketing organization and manufacturer of milk and milk products, ice creams, chocolate and confectionery, and ready to eat products. 10. ITC Foods, a division of ITC Ltd. made a foray in the confectionery market in year 2002. 11. Hindustan Lever Ltd., India‟s leading FMGC Company, has a presence in the confectionery market since 2001. 12. The CAMPCO (Central Arecanut and Cocoa Marketing and Processing Co-operative Ltd.) Ltd., is a leading processor of cocoa and cocoa based industrial products and has a small presence in the branded chocolate sector.