Marketing and Soft Drink Concentrate Essay
Marketing and Soft Drink Concentrate
The brand Rasna is owned by Pioma Industries that introduced the concept of Soft Drink Concentrate (SDC), a segment that had been created and nurtured by the company in the Indian beverages Market. The brand was originally launched by the name of ‘Jaffe’ in 1976 and marketed with the help of Voltas, but was renamed to ‘Rasna’ in 1979. When the product did not do as well as it was expected, in 1983, the advertising was handed over to an advertising agency named Mudra Communications Ltd. Pioma Industries Limited is perhaps not a familiar name for the average Indian consumer. But Pioma’s brand Rasna is very well known. In fact, the name Rasna is almost a generic name for soft drink concentrates in Indian beverages market. Rasna’s extremely popular advertisements with the tagline “I love you Rasna” had become an integral part of the Indian advertising folklore. In March, 2002, Pioma announced a radical overhauling of its strategies for the Rasna Brand.
This development was rather unexpected, as the brand had been lying dormant since long. Rasna is the market leader in the 250 Crore Indian soft drink concentrate industry. The SDC industry is miniscule compared to the 5000 crore carbonated soft drink industry (CSD). The powdered soft drink concentrate industry is worth around 90 crore. During the ‘80s, Soft Drink Concentrate (SDC) was not a known concept. For the consumers, Soft Drinks were just the aerated drinks which could be purchased in bottles and were usually consumed outdoors. Rasna came, and changed the whole mind set.
COMPETITORS IN THE MARKET
As the pioneers in Concentrated Soft Drink Industry in India, Rasna, never had to face any threatening from any of its competitors, be it a global player or a small local company. Powder concentrate occupy 85% of the total soft drinks concentrate market. Here, in this study, we are considering both Powder and Syrup CSD as competition for the Brand Rasna. Following are some of the competitors who tried to make their mark in the 250 Crore Indian soft drink concentrate industry:
1. Tang- Kraft Foods.
2. Sunfill- Coca Cola.
3. Fanta Fun Times- Coca Cola.
4. Sugarfree D’lite- Zydus Cadila.
5. Kissan Mr Fruit- Hindustan Unilever.
The journey of a brand is not always easy. The market is very dynamic and a brand needs to keep a track of the changes in the market. Rasna had to face such challenges too. But it is the resurrection this brand has shown, through strategic marketing, in all instances that makes it stand out and lead the market.
Rasna has always been recognised at large for Brand and Company. It ranks No.1 in the beverages category as “Most Trusted Brand of India”. It is listed among the top 15 brands in the country. It was awarded as the most preferred brand in the SDC category at the FMCG Most Preferred Awards 2003 and 2004 and Consumer World Award 2004. It has pioneered not only with its strong marketing strategies but also with its proper scaled distribution chain. Rasna has always concentrated on its marketing and brand building and has achieved an expertise in flavour technology. Its efficient management in production and market environments has harnessed to bring to the global consumers, technologically superior products in fruits, vegetables, beverages and confectioneries and to stand as the leader in processed food industry.
Rasna has adequate and in-depth knowledge and information on Market sizes and behaviours, Growth prospects, Project Viabilities, Government Policies, Finances etc. and access to more, enabling the company to respond fast to any proposal with suitable recommendation. It believes that there is a huge and emerging market for Rasna’s kind of product range, all over the world. Rasna is capable of managing global sized manufacturing set-ups working on the most advanced technologies to cater to the huge markets, locally and globally.
Rasna has managed to dominate the colossal SDC market because of its massive International operations. One of Rasna’s biggest strength is its marketing and sales set-up, through which millions of customers worldwide is experiencing the flavour of satisfaction. It provides a strong and pro-active marketing support to its distributors and importers around the world- just so that their products stand out and apart on the shelves. Timely delivery schedules of its products anywhere in the world are what have helped them to reach a strong position in the global market. Rasna has its offices in the following countries:
* USA and Canada
* UK and Europe
* Saudi Arabia
This strong chain of distribution to large number of countries within a stipulated period of time has helped the brand gain a reputation in the market. It has also helped Rasna in creating enormous business relations all over the globe.
The countries which imports Rasna products globally are as under:
In recent years, the brand has had to face off challenges, though not from its direct competitors. International soft drink giants like Coca-Cola (Sunfill) and Kraft Foods (Tang) have introduced competitor products in the market. PepsiCo India too is gearing to launch a glucose-based ready-to-drink beverage under the Lehar brand that will be sold at price point of Rs.5 for a 200 ml stock-keeping unit. All of them have deep marketing pockets and standard products to lure customers away from Rasna.
Even the profile of Rasna’s target audience is changing. Kids today are a lot more aware, and their parents don’t mind buying more expensive ready-to-drink products, which the MNCs have. But, true to its entrepreneurial spirit, Rasna is not about to give any ground to its rivals. Though some analysts feel that Rasna has been slow to react to the competition, Piruz Khambatta, Chairman, Rasna, still dismisses the challenge saying “water is our only competition.”
According to the 2010 data, Rasna leads the SDC market. The market shares of Rasna and all the competitors are as follows:
* Rasna- 97.2 %
* Coca-Cola’s Sunfill – 2%
* Sugarfree D’lite- 0.2%
* Kissan Mr Fruit- 0.1% and
* Tang- 0.5%.
COMPARTIVE STUDY ON 4 Ps SCALE
The Marketing Mix:
Here in this study of the Brand Rasna, we are comparing the brand with its competitors available in the market on the scale of the 4 Ps. The 4 Ps of the marketing mix are:
Product Line of Rasna:
Rasna began with 9 flavours in 1982, and added the 10th in the year 1987. The company was revamped in the year 2002. * In 2002, Rasna changed its look and came up with a new logo. * The tagline of the company was also changed and with a new tagline “Relish a Gain”, Rasna has tried a deep penetration in the rural and semi-urban market.
The Price of Rasna: Accessing all socio-economic class:
Rasna’s sole goal has been always to make profit with the volume sale. The pricing strategy has always been the key of Rasna’s success. It targeted the mass rather than the class. * Rasna has always made its products in such a way that it can be accessible to all socio-economic classes. * Its volume sale starts at as low as 1 popular in the name of 1 ka 2. * The added sugar product Rasna Frootplus starts from 2 and goes up to 105 for the family pack. * The box pack has a starting price of 10 which can make 12 glasses of drink and is known popularly as 10 ka 12. * The family box pack is available at 35 which is enough for 32 glasses of water. * Rasna has some skus which are very interesting for regular use. The air tight jar has different pack size with price range starting from Rs.75.
The company is constantly focussing on the rural market of India. So, accurate pricing is very important for the company’s growth. For Rasna, accurate pricing has been the key growth driver. They understood that the Indian market is highly segmented. And making products targeting each segment has helped a lot.
Whereas pricing has been the key growth factor for Rasna, the competitors have not been able to enjoy that benefit of pricing. Only Tang is available at a sachet of 2 which is again meant for making 1 glass of drink. Likewise, the other competitors cannot even come close to the pricing strategy of Rasna.
Promotion: Adding an Emotional Touch:
Rasna has from its inception relied heavily on advertisement. The famous mass media campaign, “I love you Rasna” was one of India’s longest running TV ad. * The promotion of Rasna always highlighted a strong connection with its customers through brand association. * Rasna has always created a brand value by emotionally attaching the customer to their brand. * Focus of the promotion is always to promote the quality of Rasna. * Rasna spends a lot on Research on the target audience, and promotes there products accordingly. * Rasna has used child characters in their advertising campaigns, and through them the company emphasised on the quality of products which was an effective way of promotion.
* Rasna has done a great deal to understand the pain of summer and to deliver a product which will ease the pain.
This kind of unique and innovative marketing ideas and campaigns made Rasna the monopoly in the Soft Drink Concentrate industry till the time the competitors entered the market. Even now, no brand has been able to beat the promotional campaigns of Rasna. Going by the set standards of Rasna, we can say that the competitors have spent very less time and money understanding the Indian market and the promotional activities that works in the India.
Place: Distribution Channel of Rasna:
The distribution channel of Rasna follows 3 to 5 tier architecture. It follows the Super-Sub concept of distribution. The steps are as follows: 1. First the product produced in a factory which is strategically located to minimise the transportation cost.
2. The packed product is sent to various company depots across the country to distribute and meet the respective market demand.
3. From the company depot, the product is delivered to the different super stockists according to their previously placed order.
4. Then the goods are sent to the sub stockists or in some cases to the wholesale store.
5. The secondary sale from the super stockist or the sub stockist is ensured by the constant monitoring by the company personal.
Rasna follows different distribution channel model according to local market demand. But for every model the end goal of the company is to deliver a quality product to the end user. With a distribution channel consisting of 35 depots across the country and 1.8 million retail outlets Rasna is bound to be the leader. Among the competitors the only one that has a good and competitive network of distribution is Sunfill by Coca Cola, but still they are not able to compete as availability with retailers is not as widespread as Rasna.
The competitive advantages of Rasna are listed below:
* Being the Pioneer in the market Rasna is well known and very much trusted in the Indian market. * Being in the market for a long time, Rasna knows the Indian taste the best. * Having 7 state of the art production units across the country, the production is never disturbed for any reason. * Because of the widespread distribution network, it is more close to the public. * The marketing strategies used by the company are of superior standard. * Last but not the least, the pricing of the product, which is so low that it is affordable by the lowest segment of the pyramid also. The competitive advantages of Tang are:
* Being one of the largest brands of the world, Tang has the sustainability even if it is hit at the beginning. * Tang is available in variety of flavours based on local consumer’s preference. * Tang is fortified with vitamins and minerals.
* It is available as powdered and ready to drink bottles.
* The powdered Tang is available at low cost.
The Competitive advantages of Sunfill are:
* Being a brand owned by Coca Cola, the distribution cost is cheaper, so can offer the product at a low and competitive price. * The taste is superior compared to other competitive brands. * Setting up of a production unit close to the target customer segment will help in better marketing. * The company can spend substantial amount on advertising and promotion.
The Competitive advantages of Sugarfree D’lite are:
* It is a brand owned by a medical company, so people have trust in the product.
* It contains no sugar, so it is healthier.
* Has medicinal advantages.
* Helps in controlling blood sugar level, at the same time gives the pleasures of a soft drink.
The Competitive advantages of Kissan Mr. fruit are:
* It is there in the market for a long time, so knows the customer taste and preferences.
* Tastier than many of the competitor products.
* Supply chain is quite strong as it’s a product owned by Hindustan Unilever.
SUGGESTIONS FOR GAINING UPPER MARKET SHARE
As we conclude the study on the No.1 Soft Drink Concentrate in India, Rasna, I have the following suggestions to make so that the company can gain more market share and continue to be the leader of the industry: Product- In terms of product, the following can be done:
1. Try to minimise waste in production, so that the cost of production comes down further. 2. Venture into new products, like ready to drink bottled drinks. 3. Try producing sugar free products so that even a diabetic patient can enjoy the drinks. 4. Health drinks and energy drinks is another field where the company can venture into. 5. Backward integration is another option that can be suggested to minimise the cost of production.
Price- the Company can be more price effective and in turn can gain more market share if, 1. More products are offered in the lower price category. 2. Price be reduced for the larger quantity cartons or bottles. 3. New and introductory products are sold for lesser price so that people are interested in trying the new things.
Promotion- In terms of promotion, the company can follow the following suggestions: 1. Use newer and cheaper modes of advertisement, like the social networking sites. 2. Spend more on Banners, posters, Hoardings.
3. Stop the use of sportspersons and celebrities, as the same doesn’t have a long standing effect on the general public. 4. Remove the time lag between the promotion and the availability of new products in the market.
Place- Place plays a vital role in the success of a company or a brand. The following are my recommendations for improving the market share: 1. Go to the newer potential places which have not been tapped earlier. 2. The untimely dispatch of goods from the depot to the super stockist needs to be taken care of as it may lead to cancellation of order bookings. 3. Unavailability of goods at certain periods needs to be taken care of with a proper distribution control. 4. Promotional events along with the distribution of brochures, stickers and leaflets should be done through sub-stockists and retailers which will help in increasing the brand value.
During the preparation of this project, help and references has been taken from many web sites and blogs and articles. They are mentioned here: -Rasna Pvt Ltd. Official site.
-Wikipedia-the free encyclopaedia
-Puneet Tandon Blogs
-Times of India Articles
University/College: University of California
Type of paper: Thesis/Dissertation Chapter
Date: 20 December 2016
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