Today,
Lux, Close Up
and Wheel are
all household
names. Nowshad
Karim Chowdhury,
Brand Director
of Unilever, explains
his company takes
a disciplined
approach that
combines market
intelligence,
number crunching,
and yes, creativity,
in managing as
many as 14 brands
and many more
extensions.
The Executive
Times (ET): You
have a number
of products or
brands. What factors
do you consider
before launching
a new product?
Nowshad Karim
Chowdhury (NC):
At Unilever, any
new product innovation
is a consumer
driven process
whereby creative
marketing and
relevant technology
leads to new and
different products.
We consider a
number of factors,
namely: consumer
need for the product;
our capability
to offer a product
to meet those
needs; development
of the particular
category in Bangladesh;
other country
experiences in
the same category
etc.
ET: How do you
identify the need
for a new product?
NC: Our marketers
are always vigilant
about new product
innovation opportunities,
be it extension
in a category
we already operate
in or entry into
a completely new
category. We carry
out a number of
quantitative and
qualitative consumer
immersion programs
on a regular basis.
This helps us
enhance our understanding
of Bangladeshi
consumers and
their needs leading
to new product
ideas. As an operating
company of a global
Unilever, we can
also choose and
evaluate new product
ideas from the
product portfolio
that Unilever
offers across
the globe.
Unilever has an
Innovation Management
Process where
every new idea
goes through four
different phases:
1. Idea: This
is the stage where
new product ideas
and concepts are
tested/evaluated
2. Feasibility:
At this stage
the product mix
(formulation,
packaging etc.)
is locked
3. Capability:
Communication
campaign is developed
and tested
4. Launch: The
product is launched
and monitored
During the launch
of a product,
the focus is on
'bringing the
product alive
in the consumer's
mind'. The execution
varies from category
to category. Typical
launch activities
include: communication
campaign on various
media, experiential
marketing activities,
awareness drive
at retail end
etc.
ET: What factors
are taken into
consideration
while deciding
to make product
extension?
NC: For all of
our brands, there
are global Unilever
guidelines that
outline the scope
of each brand.
We strictly adhere
to these guidelines
when deciding
on product or
brand extensions.
However, this
is heavily dependent
on equity of mother-brand.
When deciding
on any brand extensions,
we make sure that
it should take
something from
the core and give
something back
to the mother-brand
equity.
For example, Wheel
Bar played an
important role
in developing
the detergent
category in Bangladesh.
Leveraging the
strong wheel mother-brand
equity, wheel
washing powder
was launched in
Bangladesh during
the late 90's.
This was one of
the major successes
of Unilever Bangladesh.
ET: What are the
analyses that
you do to ensure
that the launching
of a new product
will not reduce
the band value
of other products
or cannibalize
the profits of
an existing product?
NC: We carry out
a special type
of research called
Simulated Test
Market (STM) that
helps us project
volume and estimate
cannibalization
rates for a new
product. If the
test results are
positive- i.e.
the incremental
impact is greater
than the cannibalization
impact-we go ahead
with the launch.
For example, before
launching Vim
bar, we carried
out STM putting
it against Vim
powder. The results
were positive
and we launched
the product.
ET: Having too
many products
of similar kinds
can be confusing
to customers.
How do you make
sure that these
products have
clear differentiations?
NC: Consumers
and their needs
are of topmost
priority in every
decision that
we take. Each
brand is positioned
to address a specific
consumer need.
When we have more
than one Brand
in a particular
category, we ensure
clear differentiation
in proposition
based on consumer
needs. For example,
in Toothpaste,
the two most sought
after benefits
are germ-free
mouth and fresh
breath. We have
two distinct brands
addressing these
two needs: Pepsodent
with germi-check
proposition and
Close Up with
fresh-breath confidence
promise.
Pepsi
and Coca Cola
are two very old
beverage brands.
Although these
two giants continue
to dominate worldwide
beverage markets,
in Bangladesh
consumers today
have a large number
of new soft drinks
to choose from.
Not surprisingly,
competition in
the carbonated
soft drink (CSD)
market has increased.
Bracing themselves
for this competition
the two giants
have added new
flavors and extensions
of old brands
into their product-lines
to cater for the
needs of different
niche markets
that have emerged
over the years.
These global brands
have different
marketing strategies
for different
countries. This
is primarily because
consumer preference
for a particular
brand may considerably
differ from country
to country. For
example in Bangladesh
today the growth
of lemon CSD market
is greater than
that of cola CSD
market. But in
India, it is the
opposite.
This is why Transcom
Beverage Ltd.,
the exclusive
franchise of Pepsico
USA, has launched
7Up Ice as a permanent
brand with a proposition
to provide a different
taste for lemon
CSD consumers
who may be bored
with the traditional
flavors such as
7Up or Sprite.
The product was
originally launched
in India as an
"in-and-out"
strategy for a
few months. Such
an in-and-out
strategy is often
implemented to
create extra-excitement
around the mother
brand. It allows
consumers to relish
a new flavor for
some time and
then revert to
the mother brand.
Another example
is 'Pepsi Aha',
which was launched
for a selected
period of time
in India.
Under the lemon
flavor, Transcom
Beverage has also
launched Teem,
which is cloudy
in colour, unlike
7Up, which is
clear. At the
same time, the
company has strengthened
its position in
the "no sugar"
CSD market. Khurshid
Irfan Chowdhury,
General Manager
of Sales and Marketing
for Transcom Beverage,
informs ET that
Pepsi is currently
the only company
that is providing
the "diet"
version of two
flavors-cola and
lemon. 'Pepsi
diet' and '7Up
light' are sugar
free CSD. Since
7Up light was
launched four
months back, Khurshid
claims, many consumers
have switched
from cola to 7Up
light. 7Up is
somewhat fizzy
in taste in comparison
to 7Up Ice, which
gives the consumer
a cooling feel
after taste.
In the CSD market,
there are good
reasons behind
launching product
extensions. Product
extensions offer
consumers different
tastes of flavors
under the label
of the mother
brand. If the
consumer is bored
with the mother
brand she now
has opportunities
to consume different
flavors under
the trusted mother
brand. This becomes
an important strategy
to fend off competition,
as the consumer
now may not be
willing to switch
to other brands.
At the same time,
the switch from
the mother brand
to one of its
extensions is
not likely to
reduce the value
of the mother
brand.
Transcom Beverage
is conscious about
having brands
with clear market
demarcations.
"In this
industry every
company is offering
cola flavor and
sometimes too
many cola products
might create confusion
among the potential
consumers. Our
products are differentiated
through taste,
level of presentation,
and functional
and emotional
benefit. For example
the clear difference
between 7up and
7up Ice is not
only in terms
of taste but also
of pack-presentation."
Transcom, Khurshid
claims, is the
first company
that has introduced
beverage product
of different colors
basically to target
young groups between
the ages of 15
and 25. "For
example Mountain
Dew with different
colors is for
those who are
adventurous-minded
and love to take
up challenges.
Mountain Dew is
mainly sold in
all metropolitan
areas or divisional
towns."
Distribution cost
of beverage product
is much high compared
to other FMCG
products due to
larger size and
weight of CSD
products. On the
other hand, consumers
in Bangladesh
are price-sensitive.
So packaging of
CSD is done based
on consumer's
purchasing capacity.
Transcom beverages
are distributed
in ....
