Professional Documents
Culture Documents
By Shruti Balabhadra
DM16144
Climbing the trees and plucking raw mangos, having Pani Puri with friends and
enjoying a glass of fresh mango juices. These are some of our childhood
memories which we always cherish and finally came a brand, Paper Boats
which hoped to refresh these memories with their range of drinks and beverages.
Back in 2012 when Neeraj Kakkar, Co-founder and CEO of Hector Beverages
having a business tussle with three of his business partners over a bottle of
homemade aam panna he come up with the inspiration of creating Paper Boat
drinks. Two years earlier he had already launched his beverage company, Hector
Beverages with an energy drink Tzinga which was currently doing moderate
business. At that point of time the co-founders of Hector were in a dilemma and
in search of different types of drinks to and their category. Initially they had
planned to launch a vitamin infused water but on the advice of James Nuttall,
their American partner, they planned to go in the region of traditional beverage
segment. Technically the company had identified a blind spot. After extensive
research the company realized that there was no offering of aam panna or and
other similar drink in the beverage market.
Hence the brand paper boat was launched in August 2013. The drinks were
offered in ten variant flavours in sleek and designer bottles. The offering quickly
became popular among the affluent segment. The brand offering Paper Boat had
a lot of potential in the Indian market. The brand and the product had a strong
sense of resonance with the Indian consumers. Once upon a time these drinks
were available in every corner of India, however with the Indian women getting
busier, the vendors disappearing from the picture and with multiple doubts
arising about hygiene these beverages were dying.
First came Frissia, a protein drink and then came Tzinga which was a brand of
energy drink competing with the likes of Red Bull. Initially the drink did become
popular with many IITans rooting for it but after some time its sales started
sloping and coming up with a new brand of drinks was an obvious choice.
Presently, Paper Boat has 10 offering such as aamras, aam panna, jal jeera,
kokum, jamun kala khatta, imli ka amlana and golgappe ka pani with latest
variants of sattu and rasam added as the new flavours. The company is presently
targeting the premium and metropolitan segment with an age group target of 25
to 40 years. The company has a domestic as well as international ambition in
terms of geographic coverage, with over 65 Indian cities (through the e portal)
and over 6 other countries like UK and USA under its kitty.
The company had ensured that the south-north factor does not affect the brand
or the needs of the consumers by offering drinks across evolved from multiple
regions. The company has a good distribution system in big cities like Delhi and
Bangalore, also in other metros like Hyderabad, Chennai, Mumbai and Pune have
also seen good sales even with a limited distribution system in these cities. The
company is also selling on key POCs like airports, flights, food courts and movie
multiplexes. Presently Paper Boat is selling almost 1.2 billion packs a month and
has almost doubled its sales. The mother brand Hector Beverages expects to
increase its revenue to about 100 crores all thanks to Paper Boat.
Further, the Indian climate is also paying a deterrent with fears of affecting the
natural products in terms of flavour and colour.
It is to be noted that larger, dominant players usually do not consider niche
segments and hence the biggest competitive threat to Paper Boat are the other
start-ups.
As per four studies conducted the underdog effect is influenced by the identity
structure which says that:
The consumer can create an identity with the brand: Paper Boat reminds
the consumers of their childhood and makes them tread the memory lane
thus creating an identity
The consumers who consider themselves underdogs and identify with that
tag: people in the present world are always on the run with hectic and
busy schedules, Paper Boat creates an impression that the consumers can
take away a moment from their lives and refresh their lives.
When the purchase intention is for themselves: childhood and the
formative years are a personal experience; consumers want to remember
how they used to spend their days, what fun activities they used to do as
a kid and how their mothers used to give them a refreshing glass of aam
panna after playing under the sun. Thus making it a personal purchase.
In counties and cultures where an underdog story rings a chord with the
national identity: specifically in individualistic cultures as compared to
collective cultures: the brand talk about culture and Indian traditions in the
form of the regional flavours it offers and how a kid in India lives his
childhood which results in the nation identifying with the brand identity.
The fact is that slowly customers start connecting with such brands and
finally become loyal to the brand and continue to stay so. However the issue
to look upon is what happens if the company comes at the top and whether
purchase intention, loyalty and actual choice and whether it decreases or
increases.
As per the same research paper the hypothesis that they came upon were:
As per the book, The Underdog Edge: How Ordinary People Change the Minds of
the Powerful and Live to Tell about It by Amy Showalter following are the
strategies that an underdog can play upon:
Build your uniqueness and differentiation factor: as they say first
impression is the last impression, the brand should create uniqueness in it
methodologies to create a lasting impression on the consumers; the
company should be quick in taking judgments but yet make sure that the
judgments are calculated and calibrated. The brand should ensure to give
a positive impression about itself: the Indian flavours it offers creates a
unique factor. Also the decision by the brand to foray into speciality drinks
in place of vitamin infused water was a judgement that was decisive and
calibrated.
Vivid: the company should be vivid in communicating their ideologies.
Paper Boat made sure that it communicated its messages through deep
and emotional advertisement which ring a chord with the consumers. Also
even the bottle packing and website should connect with the consumers
and exhibit an intense and strong feeling.
Grit: the underdog should show grit and perseverance to achieve his goal.
The brand should show an ideology that it can do any amount of hard work
to reach its gaol. The brand show exhibit itself as dedicated to its
objectives.
Look in the top dogs views: we should also look into the top dogs world.
The underdog should know what markets the top dog is concentrating on,
what are its marketing strategies, what are its future plans: Paper Boat
should identify the strategies and objectives of juice giants like Real and
Tropicana which in turn will help it identify its scopes and segments.
Build the pack: the brand should create such a package of product offering
which satisfy the active and latent needs of the masses. The product
offering should not be set up blindly but should have a logic and strategy
behind it: Paper Boat is offering 11 variants presently and planning to
launch 14 more in the near future. However, a question they need to ask
themselves is what is the need of so many products? Will it clutter and
clog the brand? As a brand, Paper Boat should concentrate on select
varieties of its products and create strong and suitable marketing
mechanisms for them. It is a issue that the company has a weak
distribution system and low supplier availability, it should keep this in
mind and accordingly package the offerings.
What can the underdog do for the top dog: as an underdog, a brand can
bring uniqueness and innovativeness to the consumers and hence helps in
changing the structure and nature of the market. A top dog has to thus
according adapted to the changing environment. A top dog is normally
Underdogs must that the customers learn and gain from experience. Here in the
case of Paper Boat, the brand is targeting a motivated target market (motivation
in terms of an opportunity to connect with their childhood and trying out their
favourite homely drinks on the go). The consumers have had previous
experience with other drink companies which offer aerated or drinks with
chemicals and artificial flavouring, also the other aspect of experience comes
with the Indian population having had the traditional drinks in their childhood.
Here the experience in both the facet is unambiguous thus making the
consumers more prone to trials. The consumers here have a natural curiosity to
try and taste the product after so many years after their childhood when they
have become adults.
Do everything and anything: Paper Boat has to break the habituated
consumption by offering something different and unique which the customers are
receptive to. The brand needs to develop a new distribution system such as
personal selling points like offices, kitty parties and festive gatherings. Also the
brand can leverage its costs and limited resources by offering side by side
comparison in displays in the retail stores.
Agenda disruption: low familiarity and novice consumer can also be targeted by
offering him something new and unique he has never seen before like offering
north Indian a south based drink like kokum or offering south Indians drinks like
aam panna. The brand should also use Search encouraging appeal where we
can make the consumers taste the product with its natural counterpart (like
Paper Boat Aam panna and natural aam panna) and make them realize how
authentic the product is.
Encourage trial: the company should aim at controlling exposure and encoding of
information. This can be done by offering trials at Tier I and II cities where they
offer the sample at super markets and hence create brand and product
awareness.
When he sees the bottle of aam panna or jal jeera, he should start
imaging himself as a kid having a glass of the refreshing drinks.
3. Brands voice: the company should use a unique method of telling the
consumers about itself. It should be noted that Paper Boat did not use
celebrity endorsements like its competitors to publicise its brand. It
used stories and childhood to communicate what the brand and
product is all about.
4. Word of Mouth: it is thumb rule that if you have a product offering,
people will talk about it and express their opinion which in turn will
influence other potential customers. The company (Paper Boat in this
case) should get involved with the consumers and ask for their
feedbacks and reviews. Personal recommendations are the most
judgemental and give the true consumer inferences.
5. Different offerings that your competitors have not yet offered: Paper
Boat saw at the blind spot for traditional drinks existing in the industry
and took advantage of the situation. Often, a brand doesnt need
radical and path breaking ideas, even a simple need when identified
can have massive impact.
6. Working with people who share the companys mission and vision
7. Good customer service: a great customer service will automatically
improve customer loyalty: Paper Boat should ensure that it is visible
and available is all possible locations, a consumer should not be
unsatisfied on finding the product unavailable. Also when a customer
gives appositive or critical view about the product in blogs, emails,
calls, etc., the company should acknowledge them and take them and
respond to them actively to enhance not just the product but also the
customer company relationship.
Marketing
Underdog though small in terms of resources, brand recall and offering can
stand up against the big players in the market if they have clear and
compelling marketing strategy and an orderly and uniform brand positioning.
Vistage speaker, Michael Meyers says that as an underdog a company should
concentrate on its marketing strategy on the following things:
Identify and define the market: Paper Boat is targeting a niche and
premium segment of urban people who are living a busy and hectic like by
still are connected to their roots and Indian traditions and culture.
Paper Boat is different and unique in the way that it is offering Indian
refreshment drinks which were forgotten by the masses but still loved by all.
They were not only catering to the westernised sensibilities of Indians to have a
health drink on the go but also to their Indian aspect by offering traditional drinks
in a new avatar can creating a link with the consumers memories.
Dominate the category: Presently Paper Boat is the only brand to offer
such traditional and Indian drinks to the consumers hence playing a
dominant role in the field. This is an advantage to the brand in the sense
that now consumers will relate traditional drinks with the brand and no
matter what new competitor comes up in that segment; Paper Boat will be
the set bar line criteria to judge them.
and memory aspect of the product offering. However, the brand can also offer
larger sized packages for social and family consumption.
Price: the product is very expensive compared to its competitors: Rupees 30 for a
250 ml pack. The company should work on reducing the prices which will help it
in flourishing in Tier I and II cities as well. This price reduction can be achieved by
exploring local resources and products which will not only be cheaper but also
ensure freshness.
Promotion: The promotional strategy being used by the company presently is apt
and helps in enhancing the hedonic aspect as compared to the utilitarian aspect
thus ensuring greater mind share and higher recall value.
Place: The Company has to improve its distribution not just in Tier I and II but
also in metros besides Delhi and Bangalore. This can be achieved by
collaborating with local distributors. Also the company has opened plants all
across India with a start from Madhya Pradesh and Karnataka. The company
should open smaller larger number of plants in different regions which will not
only help them in sourcing local ingredients but also help in going into untapped
regions.
Current scenario
Presently the company is planning to expand its reach in South India with the
opening of a new plan in south India. Also they are exporting their products in
countries with high Indian population like Malaysia, USA, and UK et al. The
company is even planning to export raw materials from other countries to create
new flavours. This is not such a wise decision looking at the cost and expenses
the company will endure and also we should not forget that the brand is still a
new kid in the market. The company is collaborating with universities and
farmers to procure top notch produce. The company believes in innovation and
keeps investing in Research and Development to release new variants of the
beverages.
Conclusion
Paper Boat sells nostalgia where they depend on the emotions of the consumer.
It is a product which offers heritage with a contemporary twist. As a brand Paper
Boat has aptly situated itself with a unique and different aspect. However, the
company has still not realized its true potential. As a brand it has capabilities to
create a new market segment altogether but the low distribution is hampering its
rise. Although it is a good strategy to reach out to the Indian Customers abroad
who are the moat nostalgic about Indian roots ant their childhood they had spent
in their mother land, but the brand should also create awareness on a national
level. Also as a company it should not over crowd its offering by giving too many
varieties but in fact start from a limited number and work on solidifying their
position in the market and in the hearts of the consumer. The company should
work on having multiple plants although small n multiple locations to ensure
maximum geographical reach.
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