Navratna, which has 70% market share in the cool hair oil category, has had a free run so far. But the Rs 300-cr brand is set to face competition from Marico and Dabur.
Fast moving consumer goods major Marico has a dominant 50 per cent-plus market share in the branded hair oil segment with two best-sellers: Parachute and Nihar. But the market leader hasn’t been able to make a dent so far in one critical segment of the over Rs 5,500-crore branded hair oil business.
That segment is cool hair oil, which accounts for over 10 per cent of the total market. In fact, Marico, which had launched the 'Maha Thanda’ brand a couple of years back, had to beat a hasty retreat. Godrej Consumer Products, too, had tried to enter the cooling oil segment, but did not introduce the product nationally. H K Press, former vice-chairman, Godrej Consumer Products, says, “Cool hair oil is mainly a regional market product and each market perceives the category differently. We had launched a cool hair oil long time back but did not roll it out nationally.”
Agarwal has other reasons as well to be pleased. The Rs 700 crore FMCG firm’s Navratna brand, which is known nationally for its ‘Thanda-Thanda, Cool-Cool’ campaign, enjoys more than 70 per cent market share in the cooling hair oil category. And it has been doubling its sales for the last three years even though it is among the costliest hair oils (Rs 25 for 50 ml and Rs 47 for 100 ml) in the therapeutic segment in India.
But Emami’s Rs 300 crore brand may be facing tough competition soon (at present, its biggest competitor is a small regional player – Himgange) with FMCG majors now gearing up to try their luck once again in the category. Marico, for example, is currently prototyping two differentiated cool oil variants – Nihar Naturals Coconut Cooling Oil in Bihar and Parachute Advansed Coconut Cooling Oil in Andhra Pradesh. The last one is significant as Emami will for the first time face tough competition from a seasoned player in its stronghold – the southern markets where Navratna enjoys a virtual monopoly with a market share of 98 per cent.
Dabur also joined the fray recently with its Super Thanda hair oil priced at Rs 47 for 100 ml, in addition to Re 1 sachets. This again is significant as almost a third of Navratna’s sales come from the semi-urban and rural markets through Re 1sachets.
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Agarwal, however, says the company, which launched the Navratna brand in the early nineties, will continue to cash in on its first-mover advantage and is focusing on the health aspect – the oil has just graduated from just a ‘Thanda-Thanda, Cool-Cool’ relief positioning to a stress buster that gives relief from headaches, insomnia, tension and fatigue. Emami is in fact looking at a 15-20 per cent growth this year. The company has gone in for brand extensions as well. Apart from Navratna light oil and Navratna extra thanda oil which help keep the buzz going, the company has also gone in for Navratna cool talcum powder and deodorant talcum powder.
“Creating sub-brands and brand extensions building on ‘cooling’ is one of our strategies to create a larger brand recall. So, in future too, we will introduce products and build on this successful ‘thanda-thanda, cool-cool’ concept,” Agarwal says. The brand ambassadors are also being chosen carefully. The hair oil was first launched in the interior markets of north India with actor Govinda as the brand ambassador. As the market spread to more urban and youth markets, mega stars Amitabh Bachchan and Shah Rukh Khan were roped in to make the product more aspirational.
The next stage was to add more regional flavour to the portfolio and that prompted Emami to have actor Chiranjeevi in Andhra Pradesh, Surya in Tamil Nadu and Upendra in Karnataka to promote the hair oil. While the jury is out on whether the entry of Marico and Dabur will dent the overwhelming presence of Navratna in the cool hair oil market, Agarwal is unfazed. “The thanda-thanda cool cool concept is hard to replicate”, he says. Watch this space.