Wipro’s Yardley has drawn up an elaborate plan to woo the new generation of consumers. But it still has a long way to go
It’s a 240-year-old brand enjoying a strong equity globally. It has been available in India for more than five decades now but remains a marginal player in the personal care market in the absence of a major marketing push.
So when Wipro Consumer Care and Lighting, the FMCG arm of IT major Wipro, acquired the personal care business of Yardley in 2009 from the UK-based Lornamead group, the brand was akin to “a good old friend that you have not met for a long time”, says Anjan Chatterjee, founder of Situation Advertising which now handles the brand’s advertising in India.
On the face of it, the task appeared simple: refresh people’s memory about the rich heritage of the brand and the rest will fall in place. The company roped in Bollywood actor Katrina Kaif to perform the role of brand ambassador — she, like Yardley, has a British lineage (she has an English mother, and her parents are British citizens) and considered a fashion icon by youngsters.
But soon enough Wipro discovered that the job was easier said than done.
The problem lay in consumer perception of the brand. Partly because of its long history in the country — Lornamead had a small office in India and marketed the products through 20,000-odd retail stores — Yardley had come to be seen, in the words of Vineet Agrawal, president, Wipro Consumer Care and Lighting, as “grandmother’s brand”.
In other words, slightly fuddy-duddy and not particularly relevant to the new generation of consumers. Of course, it used to be seen as the classical English brand and some of its fragrances like English Lavender were quite popular, but what was missing was excitement around the entire portfolio. “The biggest challenge for us was to make it relevant to the youth,” says Agrawal. “The Yardley brand had a residual equity, but with the older generation. The younger generation did not know about it.”
Down, not out
Wipro didn’t waste any time to address the issue. To make it relevant to the youth — the single largest buying segment in India — the company has zeroed in on deodorants as the product category to drive saliency.
The reason is obvious. The deodorants category, at Rs 1,130 crore, is among the fastest-growing segments in the personal care segment. With around 65 different brands in the organised sector, the segment has been clocking a steady growth of 20-25 per cent a year since 2004-05, with Hindustan Unilever’s Axe leading the market with a 20 per cent share. The category is becoming so big that even a retail player like Future Group has launched a deodorant line under DJ&C, the company’s largest-selling private label, and is eyeing a 20-25 per cent market share in the first year.
The other reason for focusing on deodorants, says Agrawal, is that the other two categories where Yardley had a presence — talcum powder and soaps —- were almost stagnant with hardly any growth for the past few years. Moreover, the appeal of talcum powders as a category, is confined largely to the older generation of consumers.
“We had a very strong positive — the perfumes of Yardley. The signature perfume is lavender which acted as an anchor for us,” says Agrawal. With the target audience and anchor product to reach them in mind, Wipro delved deep into the fast-growing space. The move has started bearing fruit. The market share of Yardley in the deodorant segment, according to the figures for the latest available quarter (October-December 2010), has gone up to 1.7 per cent from the earlier 0.8 per cent. Yardley’s deodorants ranges today constitute about half of its total sales in India as compared to about 20 per cent in 2009.
The company also found that since the previous management had not been able to give enough attention it requires, Yardley remained as an under-marketed brand in India selling in about 20,000 outlets. Wipro had a fair understanding of the consumer mind — thanks to its Santoor brand which has a presence in a large number of categories including talcum powder and deodorants — but since it is not a premium product like Yardley, the company decided to retain the product team it inherited from Lornamead while completely changing the growth trajectory.
“The marketing of Yardley from day one has been different from that of Santoor because it is a premium brand and enjoys a different kind of equity. We felt if we keep the same team at the Mumbai office, it will retain a certain degree of continuity while giving it a new lease of life,” says Anil Chugh, senior vice-president, Wipro Consumer Care and Lighting, who is responsible for the Indian geography.
Agrees Agrawal, “We have kept Yardley’s identity separate to ensure that it gets the right kind of attention. The passion, commitment and the focus required for the brand will go missing when you club it with Santoor or Chandrika (an ayurvedic bath soap).”
Yardley also leveraged Wipro’s understanding of the modern trade, expanding its reach to 40,000 outlets including large retail stores and cosmetic stores. In contrast, Wipro’s flagship Santoor brand sells in more than 12 lakh outlets including 5 lakh outlets where the company has direct presence. Santoor has a presence in smaller towns and even villages with population of more than 10,000. In the case of Yardley, the company has set a vision to be present in 340 out of the 388-odd cities where the population is more than one lakh.
“The vision is very clear. We want to focus more on deodorant as a category and be among the top three brands. I don’t think, we will be among the top three in all categories (deodorant, soap and talcum powder). We will like to do it faster than what we did for Santoor (it took Santoor near about 20 years to occupy the No. 3 position among toilet soaps after HUL’s Lux and Lifebuoy) because, we feel Yardley has latent equity in the consumer’s mind — we have to only unlock and leverage it lot more,” says Chugh.
Speedbreaker ahead
Yardley, an approximately Rs 100-crore brand in 2009 when it was acquired by Wipro, is believed to have grown to about Rs 160 crore. The company claims to have achieved its target of doubling its business in West Asia with the acquisition of Yardley. Though Yardley is a much smaller brand compared to Santoor, which is worth over Rs 900 crore in turnover, it is understood to have grown by over 30 per cent in the last 12 months.
Henceforth, the journey is expected to be tougher for Yardley. Yardley has already created a dent in the deodorant segment; Wipro now has to refresh its product portfolio and bring in more products from its global range. Yardley has a fantastic range of luxurious perfumes and cosmetics in its portfolio which is not currently available in India. Since perfumes is a largely undeveloped market in India, Yardley has a huge opportunity waiting for it.
“Wipro’s Yardley has gained visibility in the market,” says Purnendu Kumar, VP, retail & consumer goods division, consulting firm Technopak. “In India, the fragrances space is still very nascent and people have just started using it. Much if Yardley’s growth in the country will also depend on how it can drive growth in this segment.” What may work in is favour is fact that Yardley is perceived as a unisex brand and thus can extend the brand to address a larger audience base.
As things stand, 95 per cent of Yardley products available in India are now being manufactured here — either on its own or by third-party — while a few products are being imported from its facilities abroad. Recently, the company took the decision to produce Yardley soaps at its manufacturing facility in Tumkur (in Karnataka) from where it rolls out Santoor soaps. “We are in a transition phase. Now we are manufacturing some deodorant ranges and soaps in India. The 5 per cent we are importing from abroad will stop once we get some critical mass for which we have set some internal benchmarks,” says Chugh. As far as Wipro is concerned, the company has already done the post acquisition exercise of standardising Yardley products before starting to produce it in India.
Growing forward, Wipro will certainly like to grow the Yardley brand faster than the its established brands to drive its FMCG business which contributes about 9 per cent to its topline. “The time period post acquisition is too short to merit a critical investigation of how effective Wipro has been in utilising the Yardley association. However, Yardley has a brand legacy that Wipro can use to extend to a demographic outside of the current 15-35 age group that most cosmetic brands target,” sums up Anand Ramanathan, an analyst with KPMG.
