Brand Update : Maruti Suzuki tries premium push through Nexa

Maruti Suzuki which has a bear grip on the Indian passenger car market is desperate for a share in the premium car market. While the company has huge lead in the mid and small car segment, it so far has not been able to break into the premium segment ( 10 lakh above). Maruti had tried earlier with its Grand Vitara, Baleno, and latest Kizashi but failed to replicate the success of its affordable car range. 

Maruti Suzuki is now trying to go through the channel route to tap this segment. According to reports, the company is opening a premium channel named ( internally) as Nexa. Maruti plans to launch its premium cars  beginning with S-Cross through this channel. All cars which are in the premium segment will henceforth available only through Nexa. 

Further , Maruti believes that there is a perception that the brand " Maruti Suzuki" is very much linked to " affordability" and hence it will not be able to sell a premium car.   Hence all the new premium cars will now contain only Suzuki name . 

This is an interesting story because the company is now finding its greatest strength ( brand ) as a liability. So probably S-cross will be Suzuki S-cross and the company believes that Indian consumers will consider it a premium brand because there is no Maruti tag on it !! 

What may be hurting Maruti Suzuki management would be that premium brands like Honda are now making huge volumes by down-ward stretching ( launching products at lower price) and threatening some brands of Maruti. 

Maruti is now trying the trick of Japanese brands cracking the premium American car market. They have done through creating new brands like Lexus, Accura,Infinity which was positioned away from the mass market brands.

It is true that an affordable brand ( perception) would find it difficult to move up the value chain using the same brand name. So it makes sense when Maruti wants its premium brands to be kept away from the mass market brands. Here the assumption is that in Maruti Suzuki brand name, Maruti part is creating the perception and by removing the Maruti part, the affordable tag can be eliminated. I wonder whether that assumption holds true. Unlike Honda, Suzuki does not have that premium image in the Indian market. Suzuki brand in the two wheeler segment is not in the best shape and is not in the premium segment either. Hence just by launching a premium car sans Maruti name is not going to do the trick. As auto-expert Hormazd Sorabjee points out, the issue is more of design that positioning . None of the premium offering of Maruti had the wow factor expected out of a premium offering.

How ever, the new channel strategy would benefit the premium push because the premium brand is not sold alongside its cheap companions and better service can be delivered to the premium customers. The downside is that there is a possibility of channel conflict because existing dealers will not be able to sell high-margin cars using their current infrastructure.

According to reports, Maruti Suzuki has created a separate organizational structure for the premium category. It would be an interesting story to watch how Maruti will be able to break into the premium segment with the new strategy. 

Market Stat :ITC FMCG Brand share

From Business Standard

Brand Update : Slice Downgraded to Sub-brand of Tropicana

In an interesting move, Pepsi has demoted its mango drink brand Slice into a sub-brand of Tropicana. Slice which was launched in 1993 , came in to limelight with some good advertisement campaigns. The notable is the Aamsutra campaign featuring the brand ambassador Katrina Kaif. Tropicana was launched in 2004 as a healthy juice brand. 

What Pepsi has done with Slice is to migrate the brand to Tropicana by launching Tropicana Slice . The first launch being the variant Tropicana Slice Alphonso. The new product is being launched with the TVC featuring Katrina Kaif and Aditya Roy Kapur.

Watch the ad here : Tropicana Slice Alphonso

While Katrina Kaif stays to provide continuity to the Slice brand equity, the Aamsutra has been taken off. The focus of the variant still remains the " Taste + Indulgence " proposition. 

In many aspects, Slice as a brand is dead because the individuality is lost. It now has to follow the Tropicana's positioning. And it will remain a second fiddle to Tropicana till the Pepsi brand managers get further confused.

I am not privy to the logic behind this brand merger. According to ET, Slice has a second position in the mango drink segment trailing behind Maaza. 

The advantage I see behind merging Slice with Tropicana is that Slice will get the healthy tag associated with Tropicana. While Tropicana brand architecture will be confusing since it has a non-healthy sub-brand Slice attached to it. All the more, Tropicana also has a mango juice variant ! 

Frankly, I am little confused about this move by Pepsi, probably they will have some logic behind this move. It can be a rationalization of their portfolio. More marketing focus on Tropicana rather than Slice. 

However , as a marketer, Slice will be missed. 

LuvIt Chocolates : If Someone Shares, Ushaar !

Brand : LuvIt
Company : Global Consumer Products

Brand Analysis Count : # 558

LuvIt is new brand from Global Consumer Products - a startup in the FMCG space. Global Consumer Products was started by A Mahendran who was the Managing Director of Godrej Consumer Products. The fact that an entrepreneur is trying to take on the giants like Mondolez and Nestle makes LuvIt an interesting brand.

According to Economic Times, the Indian chocolate market is worth around Rs 6800 crore. The market is lead by Mondolez with a share of over 70% and distantly followed by Nestle with 18% and Ferrero with 8 % market share. 

What makes LuvIt a brand to lookout for is the sheer ambition to fight the giants. The brand has huge ambition and it is seen by the way it was launched. It is reported in the news that Global Consumer Products has the backing of  Mitsui Global and Goldman Sacs 

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LuvIt  has launched 9 variants with prices ranging from Rs 4 to Rs 45. The brand is essentially targeting the adults especially the youth. The brand has invested considerable thoughts in its packaging and stands out as a very vibrant young brand and distinct from the competitors like CDM.

LuvIt has been launched in South India with the actor Sidharth as the brand ambassador. For the launch the company has gone the musical route by launching a one minute music video featuring the actor. The Southern India accounts for 30% of chocolate sale.

Watch the ad here : LuvIt

The basic positioning theme of LuvIt is focused on the taste. The brand says that it is too good to be shared. This is conveyed through the ads which says that if someone shares LuvIt then Beware. There is a hidden agenda behind sharing of the chocolate because the best way to enjoy chocolate is to enjoy it alone. 

The brand is using the term " Ushaar " which means Beware in its campaign in South India. The ads are pretty, however, the theme is not new, The recently launched Schmitten Chocolate too had a similar message - it is a crime to ask for a bite.

It is interesting to note that while the market leader Cadbury Dairy Milk says chocolate is to be shared, the new competitors are focusing on being selfish with the chocolate, so it is to be seen whether the challenging brand's pitch on selfishness will find favor with the consumers.

What makes LuvIt different is the brand elements. The brand has used lively and loud colors and the ad is also flashy. So the brand has definitely all the elements to encourage a trial purchase. 

Brand Update : Maggi Noodles in a soup !

Its a worst nightmare come true for a marketer, the brand getting into a health controversy. India's favorite noodles brand Maggi landed in its biggest challenge of its life when the health officials from Uttarpradesh FDA asked the company to recall one batch of noodles of a suspected high levels monosodium glutamate (MSG).The news spread like a wildfire both in social media and mainstream media . 

The company sprang into action by denying any addition of MSG to its noodles however with a caveat that glutamate may have occurred naturally to noodles because of some ingredients. ( really !). Another news that went viral is that Maggi Noodles contains excessive quantities of the metal lead and hence it is going to be banned. Again the company in its clarification says that they test noodles for lead content and it is within the permissible limit ( really !) .

Its a crisis for a brand which is having more than 70% share in the Indian market but with competition hotting up. A big blow to the brand which off late has been harping on health platform. 

What is worrying is that the complaint has not originated from a consumer or an activist but by a government agency. Hence the perception of  seriousness of the finding is more and the damage is also grave for the brand. The main stream media also cannot ignore the issue because it is from a government department. Another issue is that since it is  a government department that initiated the complaint, the brand cannot hope for a speedy solution. 

It is interesting to observe how Nestle has responded to the crisis. The first reaction would be of denial. The brand had denied the finding of MSG stating that it has not added MSG to the noodles. The entire episode was amplified in the social media and Nestle was also actively engaging the conversation in the social media. ( Read a good commentary  by Karthik Srinivasan) . The twitter handle of the brand and the brand's micro-site has been updated with the brand's version of the events.

As Karthik has stated in the blog, the brand may be readying its brand ambassador Madhuri Dixit to convince the customer that it is safe to consume. Since Big B has also endorsed the brand, Nestle may rope him also since he already have experience in helping the brand survive such controversies   ( pun intended).

It almost 24 days since the issue began. The brand may be waiting for an independent test by a lab for further action or is it waiting for the issue to die down ? 

As a consumer since my child love noodles, there is a ban on noodles at home as of now. Because whether added or not, Nestle has confirmed presence of MSG or Glutamate and  lead metal inside - whether within permissible limit or not . Ofcourse we will continue to eat other foods till it is found guilty.

So what will happen to Maggi ?

The consumer's memory is short. So he will forget all these after sometime. Can Maggi wait it out ! The brand already had commented that it will challenge the order.

The larger issue is of trust. If one read between the lines of the company's version ( here) there is an admission that the food is not healthy but it conforms to legal norms. The company already knew the presence of glutamate and lead in it but the news came out with the controversy. It would take sometime for Nestle to rebuild its trust especially the health positioning.

It would be interesting to see how Nestle would be handling this crisis. The current strategy seems to be waiting for further clarification from independent lab tests and government actions. Probably the company  would be using the independent lab test to convince the customers that lead metal and MSG is within permissible limits and then continue telling stories of Taste Bhi , Health Bhi !.

RUOSH : Pity We Don't Make Shoes for Women

Brand : RUOSH
Company : Sara Suole Pvt Ltd

Brand Analysis Count : # 557

Ruosh is an interesting brand. The brand came to my notice through some good print ads in the TOI supplement with a very intriguing tagline " Pity we don't make shoes for women". I wondered how a brand can put such a tagline with a risk of offending women consumers.

Ruosh is a premium brand of shoes from a little-known Bangalore based  company - Sara Suole. Although the company is little known to the consumer world, Sara Suole has been a supplier of shoes to some of the well known global brands like Espirit, Kenneth Cole, Louis Phillippe etc. The company which was established in 2001 is a leading exporter of shoes and soles.

Its natural that a quality product supplier would want to establish its name in the branded world rather than remain as a little-known supplier of shoes. We have seen companies like Mirza Tanners launching their own brand (Red Tape).

RUOSH was thus born. The brand which started small in select cities is now fast expanding its footprint in both online and offline stores. 

RUOSH brand is positioned as an expert in leather shoes. The brand's value proposition is its quality and design. The branding tries to highlight through some interesting cheeky campaigns. The tagline " Pity, we don't make shoes for women" is also an interesting experiment. First it catches your attention and in a subtle way polishes the ego of men through exclusivity. 

Ruosh is currently running its TVC. 

Watch the ad here : Ruosh 1  

                                Ruosh 2

The ads are smart , humorous and conveys the message quite elegantly. Men would definitely like the way RUOSH conveyed the message. The brand has done all the right things in the branding front. The brand is priced little steeply at around Rs 4500 +  to fight it out in the premium space.