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No kick in the fizz
Sangeeta Singh |
February 12, 2005
What happens when you're old enough to drink but don't like the raw taste of a whisky sour? Or are bored in the company of spouses having one too many for the road but can't get the hang of matching them with double shots of vodka?
Then, like the 20-something, high-salaried IT executives who hang out at most lounge bars in the country, you might want to opt for a Jamaican Passion.
Or, at least that's what Bacardi Martini India Ltd is hoping even as competition in the ready-to-drink market hots up, while sales haven't exactly been setting bars on fire.
Despite rapidly changing consumer demographics, trends towards social drinking, and a mushrooming of pubs and nightclubs all over the country, the RTD segment hasn't really picked up in the two-and-a-half years since the introduction of Bacardi's Breezers in India.
Meanwhile, the other major player in the segment, the UB group's McDowell & Co has entered the fray with its own line up targeted at different types of consumers based on their age, income and sex.
While the end of 2004 saw Bacardi launch Jamaican Passion, a variant in the Breezer brand, McDowell introduced desi variants to suit the Indian palate.
These include distinct flavours like Bombay Crush (vodka and kalakhatta) and Delhi Twister (vodka and aam panna) under the sub-brand Indi Twist.
McDowell's existing brands -- Cruisers and Shotz -- had exotic flavours like passionfruit, raspberry and Ice. Not just that; McDowell also repositioned its bland RTD portfolio into the more exciting Buzzerz, signifying the buzz that they give rather than the extreme high that the drinking community in India normally wants.
Others like Shaw Wallace and Balrampur Chinni that introduced RTDs around the same time as Bacardi Breezers have virtually withdrawn their products -- Veba and Xotica --from the market.
With the industry growth estimates of 20-25 per cent in terms of volumes sales going haywire, companies are left with no choice but to woo customers with innovative variants and promotional campaigns.
Figures suggest that while 330,000 cases in the segment were sold in the financial year 2003-04, the current fiscal is expected to close at 350,000 cases, a marginal rise.
With healthy sales of 165,000 cases in the first year these "teen drinks" were launched, the promoters had made big plans. But less than two years later, that fizz has not been sustained.
Pricing (Rs 35-40 for a 275-330 ml bottle) and the lack of kick (the official age people are allowed to start drinking is between 21-25 years, when most may already have graduated to hard liquor) have been the biggest dampeners in the trade.
However, companies are now revising their strategies. Realising that consumers want more bang for their money, McDowell launched Five in November 2004 -- the country's first dark spirit-based Buzzerz.
"Five is primarily targeted at men and is available in two flavours -- Whisky Citron and Rum Ice Tea," says Feroze G Merchant, all India manager, sales and marketing, Buzzerz.
Both Indi Twist and Five have a high alcoholic content of 8 per cent (as opposed to 5 per cent in Cruisers and Shotz).
Similarly, Bacardi feels it can maintain the excitement around the Bacardi brand by constantly bringing in innovations in the category.
"Bacardi Breezer has been successful in expanding the usage of the Bacardi brand in our key consumer segments," says Jayant Kapur, chairman and managing director, Bacardi Martini India Ltd.
Adds Saumitra Sehgal, marketing manager, Bacardi Martini India: "The unique flavour and appearance of Jamaican Passion, launched in December 2004, has found a lot of appeal with consumers in various metros."
Consumers, however, aren't impressed. "I find Breezers too sweet, strong on particular flavours, and get no kick. Jamaican Passion is no different," says Sanjay Gupta, a banking executive and a recent convert to social drinking.
Women, who prefer their drinks mild and sweet, are finding the package less attractive too. Some have weaned themselves off Breezers, Cruisers or Shotz.
"I used to drink the lime-flavoured Bacardi Breezer but gave it up because it was too much like a soda pop. I would rather have a rum and coke, or make my own cocktail with vodka," says Sanghamitra Dutta, a TV journalist.
Poor consumer response also made some companies put the cork on the business. Balrampur Chinni, for instance, which launched Xotica in northern India in 2003, has virtually wound up.
"We kept getting complaints about inconsistency in the taste of our lime, orange and watermelon flavours," says an ex-employee of the company. Similarly, Shaw Wallace's Veba, launched two years back in orange, lime and grape flavours, has folded up its distribution.
But others like McDowell remain undeterred. "Even in developed markets like UK and Australia, where Buzzerz (or RTDs) now constitute 40 per cent of total liquor sales in volume terms, it had taken almost 10-15 years to establish that as a separate category. The market in India is still very nascent," says Anant Iyer, divisional vice-president, UB group's spirits division.
And with young urban adults across the country as its audience, Bacardi is continuing with its advertising tag: 'Live life in colour'. "In fact, after the repositioning of RTDs into Buzzerz, the UB group expects a growth of 100-150 per cent in this segment in the financial year 2005-06," says Merchant of Buzzerz.
India's problems might be unique -- pricing, high age-limits for drinking, a ban on advertising, and lack of sales through departmental stores -- but the craze for RTD variants is petering off in the UK as well.
The £1.3 billion sector is under tremendous pressure with sales of Two Dogs, Acqua and Hooch falling. Companies are increasingly resorting to revamped packaging and frequent changes in their ad campaigns.Is there a message consumers across continents want to send to liquor companies about wanting to fix their own drinks, or will McDowell and Bacardi's strategies work in India? Watch this space.