Revitalising Women's Horlicks in India
Women's Horlicks is India's first health drink designed specifically for women's nutritional needs. It targets a hitherto untapped segment as identified by GSKCH (GlaxoSmithKline Consumer Healthcare), namely, health conscious urban working women, in metros and mini-metros, leading hectic lives balancing career and family. Women's Horlicks seemed to have all the elements necessary for success. And yet, at present, sales appear to be flagging, a seeming contradiction that presents an intriguing case for analysis.
To many of us, the name 'Horlicks' is entwined with memories of childhood - of getting up in the mornings and gulping down a glass before running to school, or coming back exhausted from a hard evening's play only to be rejuvenated by it. Since its creation by the Horlicks brothers in 1873 (originally intended as an artificial infant food), it has undergone numerous transformations. Though the first factory in India was built only in 1960, it soon became the biggest market for Horlicks1. Despite its popularity however, GlaxoSmithKline Consumer Health Care (GSKCH), which manufactures Horlicks, has taken care to ensure that the product does not stagnate.
It underwent a revamp in 2003 with the introduction of flavours like Vanilla, Toffee, Elaichi and Chocolate to satisfy the discerning palate. What is perhaps more interesting, however, is GSKCH's strategy to segment the Indian market and to produce variants to satisfy each segment's unique needs. This is exemplified by products like Junior Horlicks, for pre-schoolers, Horlicks Lite, for health conscious adults and diabetics, and Mother's Horlicks, for pregnant and breast feeding women. In each case, GSKCH has striven to create a distinct and appealing image.
Women's Horlicks - What is New About It?
The latest case in point is the recently introduced Women's Horlicks. The basic marketing mix of Women's Horlicks is shown in Exhibit 1. GSKCH's latest offering is targeted specifically at the modern urban Indian woman who is historically known for putting everyone else ahead of herself. Women's Horlicks is designed to specifically address the health needs of women providing 100% of the daily requirement of iron, calcium, folate and vitamins B2, B6, B12, and C2. The target segment therefore consists of health conscious urban working women, in metros and mini-metros, between the ages 19-50, leading hectic lives focusing on career and family and hence not able to take care of themselves in the bargain.
Marketing Mix of Women's Horlicks
In order to highlight its nutritional aspect, GSKCH is promoting the product both through traditional print and TV media, and also by enlisting the support of professionals in the medical field. In a brilliant casting choice, eschewing the current glamour dolls of Bollywood, Konkana Sen Sharma was selected as the face of the urban Indian woman of today, balancing career and home, a choice sure to resonate with most women. This, combined with the baseline, "Because your body needs you too!", starkly elegant in its very simplicity, captures the essence of the brand image GSK is trying to build.
GSKCH also introduced a Doctor Engagement Program wherein the company reaches out to physicians, dieticians and nutritionists to educate them about the product. This in turn, would hopefully lead to an official or at the very least, unofficial, product endorsement by these professionals. Their core strategy lies in grabbing the mind space of the consumers, rather than following the more traditional hard-sell route.
Reasons Behind the Failure of Women's Horlicks
Women's Horlicks appeared to have a hit combination - a winning brand, a double-edged promotional campaign, an excellent distribution system already in place, courtesy the other Horlicks variants and a well-established brand name. In spite of these advantages, it has not been able to make an inroad into the Indian health drinks market. This failure could be attributed to a number of strategic causes. To get a better understanding, we conducted a survey. The results, from 50 respondents, are shown in Exhibit 2.
Is the price of Women's Horlicks justified?
The product is perceived to be expensive by the customers surveyed. Women's Horlicks is available in a 200 gm jar, which costs Rs.100 while traditional Horlicks is priced at Rs.124 for 500 gm3. This disparity in cost might be due to the special formula that is used to prepare Women's Horlicks but primary research showed that the consumers perceive the price difference negatively. The fact that the retailer's margins for this product is higher compared to that of similar products seems to further validate this perception. It can also be interpolated that at all stages of the value chain the margins might be in a similar range. This translates to an expensive product and results in lower sales.
Moreover, one of the most important facts discovered through the primary research was that when customers opened the container for the first time after purchase, they were disappointed with the amount (volume) of Women's Horlicks in the container. They felt cheated and swindled. In other words, the container for the product was disproportionately large for its actual content. This only served to add to the existing perception that the product is over-priced and deterred future purchases of the product.
Finally, the primary research also brought to light another revealing fact4. Women place an enormous amount of emphasis on taste even for health product as can be seen in Exhibit 3. Now, Women's Horlicks and regular Horlicks are fairly similar in taste; therefore, women inadvertently do not perceive a difference between the two products and hence do not find any justification to buy the more expensive product.
Most Important Feature of Health Drinks
The combined effect of all these factors has led to sales figures significantly lower than predicted and with no signs of improvement in the near future. Possibly due to this lack of demand, Women's Horlicks is not easily available in all supermarkets and retail stores, further exacerbating the situation. Even where available, it is usually relegated to the bottom shelf, resulting in minimal visibility.
Sales are low, especially in comparison with other Horlicks products. Thus, despite its high retailer margins, retailers are not enthusiastic to carry the product at their stores, implying that lost sales aren't significant enough i.e. they don't expect sales to increase significantly.
What Can Women's Horlicks do to Revive Itself?
Based on our analysis we believe that GSKCH could consider adopting the following strategies to turn around the fate of Women's Horlicks.
The sales of Women's Horlicks are lower compared to that of regular Horlicks and Junior Horlicks and consequently retailers hardly have an incentive to push the product. This is despite the fact that retailer margins on Women's Horlicks are higher than the industry average. Since our study indicates that there is a general perception about the product being pricey, GSKCH should consider reducing retailer margin in order to bring down the MRP slightly and thus boost sales.
One of the striking revelations of our study is that people perceive a mismatch between the size of the container and the volume of Women's Horlicks actually contained. This adds to the existing perception that the product is expensive and deters future purchases of the product. A change in packaging is therefore recommended, more specifically, reducing the container size to make it better aligned with the actual quantity inside it. Alternatively, GSK could consider increasing the volume contained in each jar. This would improve people's perceptions of the product's value-for-money, though at a cost of reduced profits per container.
Push Marketing Strategy
GSK did a fantastic job of TV advertisements to promote the Women's Horlicks brand. As a result brand awareness and brand recognition among the sample target population is fairly high. However, a very small percentage of this has translated into actual sales. This calls for an aggressive push strategy, because although awareness is already very high due to extensive TV communications, potential consumers have not experienced the product.
Aggressive Trade Promotions
GSK being the market leader in the health drinks industry could pursue an aggressive promotional strategy to give a free small trial pack of Women's Horlicks (approx. 50 Gms) with two large jars of any other GSK product line health drink. Such a lucrative offer will stimulate purchases on the part of the consumers and would increase the probability of it entering their consideration set the next time they make a purchase.
Consumers, especially women consider the taste of health drinks as a primary determining factor while choosing one. In this aspect Women's Horlicks has failed to create any differentiation, as consumers perceive no significant taste difference between Regular Horlicks and Women's Horlicks. This factor also results in cannibalization of Women's Horlicks sales, as the regular Horlicks is relatively cheaper. Therefore, a strategy to reconsider the taste so as to introduce it as a differentiating factor is recommended. A completely new flavour, associated only with Women's Horlicks, should be developed which consumers should perceive positively.
Conclusion: Is Women's Horlicks Ahead of Its Time?
There seems to be a disconnect between the intended core message of Women's Horlicks and the interpretations made by the target consumers. While the key emphasis appears to be the health aspect, from a consumer perspective, substantial differentiation from other Horlicks products appears to be absent. In addition, women in India generally consume health drinks when they are ill or during pregnancy. Since Horlicks already has a product for pregnant women, it is possible that it could cannibalize into Women's Horlicks' market. It is therefore open to debate whether Women's Horlicks is ahead of its time in the Indian market. There is possibly a latent need for the product but at present Women's Horlicks hasn't been able to expose that perceived need and satisfy it.
Moutusi Maity was a faculty member in the Marketing Area at Indian Institute of Management, Bangalore. She holds a Phd. in Business Administration from Terry College of Business and a Masters of Business Administration from IISWBM, University of Calcutta.
Arunava Saha Dalal (PGP 2008-10) holds a B. Tech. in Computer Engineering from Institute of Technology - Banaras Hindu University (ITBHU) and can be reached at firstname.lastname@example.org
Giridhar Rao B.G. (PGP 2008-10) holds a B. Tech. in Computer Science & Engineering from NIT Trichy and can be reached at email@example.com
Navneet Chahal (PGP 2008-10) holds a B. Tech. in Computer Science & Engineering from Indian Institute of Technology (IIT) Roorke and can be reached at firstname.lastname@example.org
Rohini Ramachandran (PGP 2008-10) holds a B. Tech. in Electronics & Communications Engineering from NIT Trichy and can be reached at email@example.com
Suraj Holla Byndoor (PGP 2008-10) holds a B.E. in Computer Science & Engineering from SJCE Mysore and can be reached at firstname.lastname@example.org
Horlicks, FMCG, Strategy, India
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