Saturday, August 15, 2009
Nadia Chauhan, Joint MD and CMO, Parle Agr0
Ms. Nadia Chauhan is Joint Managing Director and Chief Marketing Officer at Parle Agro Pvt. Ltd. In her role, she oversees Product Development, Marketing, Sales and Distribution for all the brands of Parle Agro Pvt. Ltd. She also leads new business ventures. Nadia has played a pivotal role in the phenomenal growth of Parle Agro over the years. She has big plans and expectations for the future of Parle Agro and is constantly driving Parle i Agro towards being India’s number oi one FMCG Company.
Markathon: As multinational cola czars are sharpening their focus on 'non-cola' drinks, how are Indian players like Parle Agro gearing up to fight these multinationals in the Indian fruit-drinks market?
Nadia Chauhan: The fruit drinks market has been seeing rapid growth over the last few years. And that has motivated various F&B players to invest and foray into the non-cola drinks segment.
Besides the multinationals, there are several local players who have sharpened their focus in this segment.
From our point of view, we welcome competition. Since, for one, it helps further expand the market, and additionally, it ensures that the older, more established players in the segment do not lose focus. We enjoy being kept on our toes and are constantly looking for new ways of expanding our business in this segment.
To quote a cliché, nobody remembers the second man on the moon. And fortunately for us, we have the first mover advantage in this segment, and that can take us a long way. It keeps you on top of the mind for a long time. With so many firsts to our name, Parle Agro has the proud sobriquet of being a pioneer in the Indian beverage industry.
With rising competition, Parle Agro does not just bank on its pioneer status. Constant innovation, an open mind and a vision for the future will ensure that we are always ahead in this race.
At Parle Agro, we focus a lot on the kind of products we create. With one of the most advanced R&D facilities, we have developed some of the most path-breaking products, all first of its kind in India.
With an established distribution network, we ensure that no matter where in India one goes, our products are available.
And finally, an aggressive approach to marketing has helped us create and continue creating some of the most iconic brands in India.
Needless to say, our focus on quality is what’s allowed us to garner the trust of the billion in our country.
Markathon: Now bottled water has become more of a commodity. What initiatives are you taking to make yourself different from your competitors?
Nadia Chauhan: Over the last few years, the bottled water market has seen a growth of over 40-45% per annum. This growth has been tapped not just by the existing players in the market, but by various new players as well. Our various initiatives have ensured that Bailley has been growing at the rate of 150% every year.
“Parle Agro has the proud sobriquet of being a pioneer in the Indian beverage industry”
There was a time when most consumers would go into the market and ask for Bisleri, the then generic for packaged drinking water. Even if they were given a brand other than Bisleri, they would have happily taken it. That was the time when bottled water was far more of a commodity.
Today, things are different. You have premium water (such as mineral water brands), you have the premium water brands within the packaged drinking water category and you also have imported water brands. The hospitality segment, which plays a large role in this category, is rather choosy about the brand of water that they serve. They aren’t necessarily serving the cheapest brand. They are serving a brand that fits their requirements. In terms of look and feel (overall image) of the brand. These are signs of the bottled water market becoming more and more of a branded segment and less of a commodity
Today, the bottle of water a consumer carries with him to the gym is a reflection of his lifestyle, his taste. It is almost becoming like a fashion accessory. Having identified this transition over the years, we invested in revamping our bottle design/structure, our branding, our distribution and our communication, to create a specific preference for our brand.
Now, you see Bailley being sold at retail stores, fine dine restaurants, premium star hotels, at airports and various other key locations. Bailley is also sold on many premium airlines as the preferred choice of water.
Every effort invested in the brand Bailley is in line with the fact that the bottled water market is no longer a commodity market.
Markathon: Parle Agro is in an aggressive mood to capture greater market share in the beverages segment. The launch of LMN and Grappo Fizz proves this point. What is your take on this?
Nadia Chauhan: We have a clear vision for Parle Agro. We want it to grow and be a Rs.3500-crore FMCG giant in the industry and every introduction from Parle Agro is in line with this vision.
This year, we’ve introduced more products than in the past. Whether it is LMN, Grappo Fizz, or even Saint juice. Each of these products is an entity within 3 separate beverage categories. And each of these products has different goals to achieve in the market.
We’ve always been aggressive and this year is no exception. We’ve only gotten better. This is because we enjoy responding to the needs of the market, and we have seen a growing need for variation, for innovation, for quality and for aspirational brands. Hence, each of our introductions has been in line to cater to this.
Markathon: “More important than pricing and distribution network, the advertising and communication strategies are the vital determinants in deciding the success of the beverage products”. Your comment.
Nadia Chauhan: Whether it’s a beverage or any other product. Whether it’s your success or mine - as individuals. Whether it’s the success of your institute or the success of my organization. None of these successes is guaranteed on the basis of a single factor. Think back and you may agree.
For the success of any brand, there are multiple factors that are responsible for it.
Firstly, you’ve got to have the right product at the right time. Many a times, sophisticated R&D facilities develop some of the best products that are the most advanced but don’t last too long in the market, because they are introduced at the wrong time. Timing in life is everything.
Sometimes, a product is either too early for its time, or too late. I’d use one of our own examples for this. Many years ago, we launched a product called Jolly Jelly. A jelly drink that was marketed in Tetra Pak packaging in India. When we launched it, most consumers either didn’t know what jelly was or believed that jelly had to be non-vegetarian. Struggling to communicate (though we advertised extensively) we decided to withdraw the product. However, if we were to launch it today, a time when you see Jelly based confectionery all over the market place, even in the smallest of markets and the smallest of outlets, we might taste success. This learning has lasted us a long time, and has ensured with every launch we’ve asked ourselves one question – is this the right time. This doesn’t mean that you stay away from innovation, but you take calculated steps forward to ensure your innovation is introduced at the right time.
Choosing the right packaging, the right branding and the right packaging design is the second most important aspect, before you can see any success for your brand. Remember, that packaging is the first form of advertising. It tells the consumer why he should pick up that product and what the product has for him.
Pricing is a major determinant and is linked to my next point, which is distribution. Whether you have a mass product or you a niche product to market, you have to pay close attention and understand the consumer psyche in detail with regards to pricing. It differs from portion packs to take-home packs. You find that the psyche towards portion packs is far more sensitive than that towards take home packs. Retailers in India understand the importance of pricing to the consumer as much as most marketers do. Hence, a product with a pricing that is not relevant or justified results in the retailer refusing to stock it, hence restricting your distribution tremendously.
Besides price preference of whether it’s priced too high or too low, brands over time have established branded price points, which has created a preference or a convenience factor amongst consumers. Whether it’s Rs. 10 for a pack of Frooti or the Rs. 5, which was established by Maggi. These are magical price points, which most brands strive to have for themselves.
The right pricing can ensure right distribution. But besides the pricing, having a strong distribution infrastructure is key. Focusing on retail distribution rather than wholesale distribution is the key. Ensuring vast product placement is again important. When a consumer sees your product everywhere, he immediately begins to think - “Wow, this product seems to be doing really well, let me try it out.”
Now, after you have done all of this, and you’ve stabilized, your advertising becomes important. How you promote your brand in the market space and how you create need for your brand in the minds of the consumer through an emotional platform on television or other mass media.
Mass communication ensures that your product works itself towards being top of mind. It also ensures that a buzz is created around your brand. But this alone could not do anything for your brand. In fact, if you have fantastic advertising and a bad product, you’re in trouble. If you have fantastic advertising and no distribution, you’re in trouble. And even if you have fantastic advertising but a bad price point, you’re in trouble.
“Frooti was the first beverage in India to be sold in a Tetra Pak”
Markathon: Frooti is your group’s flagship brand and market leader in its segment. What are the new initiatives taken by the company to maintain this position?
Nadia Chauhan: Frooti has achieved this position because from the day it was introduced, it set new standards for the beverage industry. Being the first national mango drink in the country and the first beverage in India to be sold in a Tetra Pak, Frooti raised the standards of innovation, quality and vision to another level for its time in 1985.
Frooti did not stop there. Every few years Frooti ensured that it re-invented itself, to make it relevant to the youth and move with the time. The product never changed, and never will, but everything around it did, ensuring that it was always as aspirational, always trendy and always your favourite brand.
Even today, Frooti continues to innovate. Frooti was the first fruit-based beverage to be introduced in PET not too long ago. We also have just revamped our entire package design. We introduced some path-breaking SKUs, which have made Frooti affordable to all those who’ve heard of Frooti and wanted Frooti, but could never buy one. This was possible with our triangular pack, which was originally launched at Rs.2.50 and maintained the same price for a few years. It is now at Rs. 5.
The communication for Frooti over the years has kept evolving, making it contemporary and relevant to the youth. This year, Frooti has been ranked as not only the number one fruit drink brand in India but also as the 29th most trusted brand in India amongst a 100 FMCG brand survey, by the Economic Times.
Markathon: Parle Agro is the trendsetter with respect to packaging of beverages, whether it is Tetra Pak or PET bottles. And as packaging directly impacts end consumers, how do you take these decisions?
Nadia Chauhan: Parle Agro was the first company to introduce beverages in Tetra Pak in India. Not just that, Parle Agro was also the first to introduce fruit drink in PET bottles. As you’ve rightly mentioned, packaging innovation is an intrinsic part of Parle Agro’s product success philosophy.
Besides working very closely with our packaging companies to create new benchmarks and create innovative packaging options for our brands, we also have a large team of highly experienced packaging specialists who work on achieving the various goals that are set for our brands.
Packaging decisions are based on type of product, the best way to experience it (consumption pattern), the target consumer and most importantly, the pricing.
Besides the above, packaging decisions are also based on shelf life of the product that we’d like to achieve, especially considering the complexity of the distribution system in India.
While the above might highlight most of the functional and technical aspects in the decision making process with regards to packaging, there is a softer side as well.
One major aspect with regards to packaging is the ergonomics. The package design, the aesthetics. We work very closely with our communication partners who are trained on the various forms of packaging that we operate in, so that we can achieve the highest level of output for each brand in terms of the aesthetics. Once again, like I’ve said before, we give a lot of importance to packaging, because we realize that it is the first and most impact generating form of communication.
Markathon: Where do you see Parle Agro in the near future?
Nadia Chauhan: I see Parle Agro achieving its goal of being a Rs.3500 crore company. I see Parle Agro growing further to achieve new heights. We’ve grown already from being a major beverage player to having a dynamic confectionery and recently introduced snack
food range as well. Parle Agro, in the near future, will not only be a
major Food & Beverage player, but will make way into being a major FMCG player in the country.
Markathon: Finally, we would like to hear about the competencies required by the management graduates for making it big in the Indian FMCG industry.
Nadia Chauhan: FMCG is a fiercely competitive and demanding sector to be in. In the current economic scenario, it is amongst the few sectors that have maintained a steady growth rate, braving the global recession and the rough times the country has been through.
For those aspiring to make it big in FMCG, you need to have the zeal to win. You have to be energetic and confident to take on new challenges, be persistent and be prepared to work very hard. These traits will help you develop the right kind of attitude required to fit well in the FMCG industry.
Besides these, you need a fair degree of commitment, a quest to learn, ability to deliver results on time and a great deal of passion for the work you do.
Like the American author John Maxwell once said, “A great leader's courage to fulfill his vision comes from passion, not position.”