ujala's new avatar to battle segment blues _ business standard

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10/9/13 Ujala's new avatar to battle segment blues | Business Standard

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Management Features Marketing

Neha Pandey Deoras | Bangalore August 21, 2013 Last Updated at 00:10 IST

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Ujala's new avatar to battle segment blues

Jyothy Labs contemporises the leader in fabric whiteners to spur on a segment suffering from the effects of

consumers upgrading

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The home-grown FMCG company, Jyothy Laboratories (Jyothy Labs), re-launched its 30-year old brand, Ujala, last

month. Even though it is the market leader in fabric whitening, it had to be refreshed for a category whose existence

could come under a cloud as consumers increasingly upgrade in the long run.

After the relaunch, the fabric whitener is available in a new bottle. Jyothy Labs has also changed its tagline to Safedi ke

aage ujala (Brightness/radiance beyond whitening).

S Raghunandan, chief executive officer of Jyothy Labs, says, "We recognise consumer needs are becoming more

dynamic. The new Ujala packaging represents Jyothy Laboratories' commitment to understand and cater to the

changing preferences of consumers." The new packaging is an attempt to make the product look contemporary.

The company has also tweaked its positioning. It wants to emphasise radiance over whitening. "The tagline is to

emphasise that Ujala delivers radiance and not just whitening. Today detergents also promise whitening. You can whiten

using detergents, but you will get radiance only by using Ujala, without needing a bar, brush or blue," Raghunandan

explains. For an emotional connect, the new TV commercial talks of success to appeal to young, achievement-oriented

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individuals.

"Safedi (whiteness) is a very old stance used for products in this category. Also there is nothing new in the execution of

the advertisement. Other brands have told their stories on similar lines. A new tagline or packaging is not enough," point

out Sridhar Ramanujam, CEO, brand-comm, a brand consulting firm.

Ujala competes with Hindustan Unilever's (HUL) Rin Fabric Whitener (erstwhile Ala) and Rin Perfect Shine, and

Reckitt Benckiser's Robin Blue. Ujala is pitted not just against fabric whiteners but also detergents with a whitening

claim such as Rin and P&G's Tide.

The rebranding has not altered the pricing. Ramanujam says that Ujala is already priced higher than Rin Fabric

Whitener. Ujala's whitening liquid costs Rs 17 for a 75-ml bottle. Its 250-ml bottle costs Rs 50. In comparison, Rin

Fabric whitener costs Rs 20 for a 200-ml bottle, while Robin Liquid Blue costs Rs 16 for a 75-ml bottle.

Industry experts believe the move to recast Ujala comes at a time when HUL has been stepping up its efforts in the

laundry segment. Last year, HUL entered the fabric blue space with Perfect Shine, despite slowing growth. This year it

launched a liquid detergent under Surf Excel. In 2010, the company had launched a fabric softener Comfort. HUL

derives about 45 per cent of its annual revenue from soaps and detergents. Analysts peg the company's detergents

business at about Rs 6,000 crore.

However, Raghunandan maintains that new entrants have not dented Ujala's market share. "Ujala continues to maintain

a 70-per-cent market share, whereas Rin's market share has been at 2-2.50 per cent and is declining," he says. Robin

Blue has a share of 3.5 per cent, according to sources. The market for fabric whitening was small, at about Rs 300-350

crore in 2012, says Chaitra Narayan, associate director - chemicals, materials & foods practice at Frost & Sullivan.

Some analysts feel Jyothy Labs needs to work more on its distribution to remain at the top, as HUL's products have a

strong distribution to ride. Ramanujam says a strong distribution is directly proportional to market share. To maintain or

increase its market share Jyothy Labs will have to increase its bandwidth across India.

Raghunandan retorts, "HUL has a far superior distribution system than most other companies but that does not mean

that it can be successful in all the segments. Making a product available in the market is just one part. Once a product is

available, only the consumer decides which one is better."

Apart from distribution, brand equity has a competitive role to play as well, which had led Ujala to usurp Robin Blue.

However, the biggest challenge for Ujala is a fabric whitening market where volumes have not risen much over the past

year. "The volumes have grown only four to five per cent over the last one year. In the year before last, volumes were

flat," says Raghunandan. Volume growth of Ujala has been around five per cent.

With Ujala as its flagship brand, Jyothy Labs might run into trouble as the segment's growth prospects are unclear.

"Fabric whitening is not a large value segment. It is also limited to a very niche consumer segment, that is, consumers

using mid-value detergents. This puts a constraint on the growth prospects as most consumers will be upgrading to

premium detergents, which do not require any additional whiteners. Positioning and branding of the product will become

crucial in determining the growth of this segment. Most companies in the detergent space are trying to position

themselves as a total fabric-care provider, be it HUL entering the niche segment of fabric whitening or Jyothy Labs

entering the laundry-wash segment," explains Narayan.

Jyothy Labs says consumers want more products in the whitening space and is planning to extend brand Ujala. It is
http://www.business-standard.com/search?type=news&q=Fabric+Whitenershttp://www.business-standard.com/search?type=news&q=Hul


5/11



piloting an Ujala detergent in Kerala, priced at Rs 85 for a kilo.

It is also readying a shift to the premium end in laundry with Henko in stain-removal detergents. Part of German

Henkel's India business that Jyothy Labs acquired (now rechristened as Jyothy Consumer Products), it will fight P&G's

Ariel and HUL's Surf Excel. It has to be seen whether Ujala will be able to hold its own against Jyothy Lab's push in the

premium end.

Read more on:

Ujala|

Fmcg

|

Hul

|

Jyothy Labs

|

Fabric Whiteners

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