The Indian Kitchen The Indian Kitchen Salt MarketSalt Market

Brand WarsBrand Wars

Salt and IndiaSalt and India• India is the third largest salt producer. • Average annual production of about 148

lakh tones. • Exports Salt from 1953. • Exports touched an all time high of 1.6

million in the year 2001.• Exported to Japan, Philippines, Indonesia,

Malaysia, Nepal, and Bhutan etc.

Salt’s role in Indian Salt’s role in Indian IndependenceIndependence

• The government dictated that the sale or production of salt by Indians was a criminal punishable offence and this had an impact on all of India as salt was a basic need.

• The Dandhi marchThe Dandhi march• hurt the very core of

the British belief that the common man hardly cared.

StatesStates• Coastal states

– Gujarat– Tamil Nadu– Andhra Pradesh– Maharashtra– Karnataka– Orissa– West Bengal – Goa

• Sea salt• 70% of total salt

• Hinter land State – Rajasthan

• Salt water Lake

Need of Salt to humansNeed of Salt to humans• regulates the water

content of the body• balancing the sugar levels

in the blood• natural hypnotic, sleep

regulator• nerve cells' communication

Iodized salt Iodized salt • Iodine deficiency • Goiter

Pre 1980’s Salt MarketPre 1980’s Salt Market

• Regarded as commodity• No national-level brand• Households used local

brands or unrefined salt sold in loose form.

TATA Salt TATA Salt First Branded Salt First Branded Salt

• Launched by TATA Chemicals Ltd.

• In 1983• 1Kg Pack @ Rs 2• Highlighted the issues

of impurities in other salts sold

Brand War Begins….Brand War Begins….

CatchCatch• Table salt

• By DS Foods• In 1987• 200gms @ Rs 6• Small segment

Captain cookCaptain cook• In 1991• DCW Home Products Ltd.• USP – Free Flow• Customers got another option• Overall customer awareness about

the merits of branded salt increased amoung masses

TATA Salts ReactionTATA Salts Reaction• Launched new campaign

with tag line “Saltier Salt”.

• Included the free flow proposition in a subtle manner.

Dandi saltDandi salt• In 2001, October• Launched by KAG• Positioned at purity platform• Triple refined. (other brands only

double refined)• Frequently aired short and strong

advertisement

Annapurna SaltAnnapurna Salt• HLL• In 1996• Positioned on the Health

benefits platform.• Highlighted the issue of

Iodine content in salt

Annapurna’s successAnnapurna’s success

• In 1980’s Government of India along with UNICEF had undertaken educational campaign to stress the importance of iodine content.

• Though Tata Salt was first brand with iodized salt, they did not advertise it

• Grew to second position• Killed Captain cook

NutrasaltNutrasalt• In 1998, January• Dabur India Ltd• Positioned in

health platform as a salt with low sodium content.

• A Kg @ Rs 20

Saffola saltSaffola salt• In 1998, November • Marico Industries• Positioned on health

platform – mineral enriched low sodium salt

• Initially packed in Reusable jar.

• A Kg @ Rs 20

Pricing Strategy of Nutrasalt Pricing Strategy of Nutrasalt and Saffola saltand Saffola salt

• Attempt to move salt from commodity stage to branded stage.

• Market was not mature enough to justify this kind of premium pricing.

TATA Salt- Celebrity TATA Salt- Celebrity EndorsementEndorsement

• Country’s most Well-known chef “Sanjeev Kapoor”.

• He emphasizes TATA Salts superiority over other brands in iodine content, free flow, purity and whiteness of the salt granules.

Nirma ShudhNirma Shudh• Launched by Nirma• In 2000• Highlighted that the salt is

Vacuum evaporated and entire manufacturing process is free from human intervention – better quality.

(others are sun dried at salt fields and then refined)

NatureFreshNatureFresh• Cargill India Ltd• In 2001, December• A Kg @ Rs 7.50 • Positioned on the health platform• Claims of the Nature Fresh are

– Enriched with calcium and magnesium along with iodine.

– Most granular salt available.– Free flowing under all weather conditions

War Intensifies…War Intensifies…

Dandi saltDandi salt• Tagline “ Amrit hai buddhi aur shakti

ke liye”• Heavy advertising in regional TV• Strong Distribution network is built• Innovative cross-selling (get one

saree for every purchase of Dandi salt)

• Market share of 0.97% within one year of lanch.

Annapurna saltAnnapurna salt• New patented Technology • Prevented the loss of iodine in all stages

(storage, transportation, cooking)• Tied-up with International Council for

Control of Iodine Deficiency Disorders (ICCIDD).

• Took initiatives to educate customers about the benefits of iodine and its role in the mental development of children.

• Registered a growth of 33% in 2000-01

TATA SaltTATA Salt• In late-2001• New advertisement

campaign adding patriotic angle to purity issue.

• Tag line “maine desh ka namak khaya hai”

• Test marketed a regional brand ‘Samudra’ @ Rs 5 per pack

Nirma ShudhNirma Shudh• Re-launched in late-2001.• Tagline “A better product with better value

for better living”.• Was a failure.• Reasons for failure

– Ineffective distribution strategy.– Nirma’s image as low priced, (possibly) low

quality products.– Consumers considered Nirma as a detergent

Brand.

Branding of CommoditiesBranding of Commodities• Commodity - denote both markets with

very intense price pressures

• companies compete on the basis of low cost/low price.

• "commodity" also refers to a specific group of products and markets – lower levels of (lowly) differentiated products or services with high levels of substitutability and straightforward price discovery.

Analysts opinionsAnalysts opinions

• The commodity market will progressively move into the branded portfolio as long as there is ‘value delivery

• The market grows @ 12% per annum.

Opinions…Opinions…“One of the reason why salt is outperforming other

branded commodities is to do with the life span of branded salt being longer. Apart from that , there has been an effective ‘ Iodine deficiency campaign’, owing to which the penetration of the branded salt is about 20% nationally, compared to 1% for branded atta and sugar”

- Ajai Puri, Head of Sales and Marketing, Cargill India Ltd

Opinions…Opinions…“Salt, sugar, atta – all are commodities, but at very

different stages of evolution with different brand building drivers. And while the three segments are not entirely comparable as products, in evolutionary terms. Salt is ahead”

- Kapil Mehan Vice President (Sales and Mktg) Tata Chemicals

Ltd

Opinions…Opinions…“While the consumer is swayed by a number of brands and

benefits which indicate a low brand loyalty, there is a preference for reputed brands and familiar names. That is because salt is a habitual product and the consumer does not prefer frequent brand switches. She looks for comfort level in usage and measure of salt”

- Kapil Mehan Vice President (Sales and Mktg)

Tata Chemicals Ltd

Branding StrategyBranding Strategy• Finding Meaningful differences

• Image or other non-product related considerations

• Secondary Associations

Tata Salt Tata Salt Marketing StrategiesMarketing Strategies

Salt by-product of the distillation plant of Tata Chemicals

Highlighted Impurities in the salt supplied by local brands

Changing Customer Perceived Value in branded salt

Tata Salt – Product Tata Salt – Product DifferentiationDifferentiation

FreshnessPurityQualityconvenience

Tata Salt - PositioningTata Salt - Positioning Positioned as the processed salt free of all

impurities

Product positioning: ‘Salt of the Nation’ – emotional connect Value Proposition For customers Tata Salt stands for purity,

trust and value.

Tata Salt – Getting 4Ps rightTata Salt – Getting 4Ps right

• Product: 99.8 % purity

• Price: priced at Rs. 8/- Kg for premium segment And Samundar Salt at Rs. 5/- Kg. for semi urban

and rural segment • Place: Strong distribution network reaching rural

markets • Promotion: low involvement product, higher

amount is to be spent on advertising for better brand recall

Future….Future….Future…

• Still 70% of total market is in the hands of Unorganized sector.

• Brand switching extremely easy and brand loyalty very difficult to attain

• Intense struggle in terms of positioning and promotion

• Companies are reluctant to enter the market