Problem Statement

 Should the brand add more variety to its product line?

OR

 Should it focus on few best-selling variants in order to grow?

 What should company do to stay relevant, when Dabur has launched “Yoodley” to counter
Paper Boat?
 How could Hector Beverages’ marketing strategy keep the growth momentum going and
consolidate the company’s growth on Indian Ethnic drink market?
 Sourcing of Raw Materials was a problem
 Seasonal ingredients procurement
 Lack of organized suppliers

Paper Boat Product / Brand

 Ethnic Drinks Category (non-carbonated flavoured drink) – niche market

 Brand Launch – 2013
 Tagline – Drinks and Memories
 Core Benefits
o Product’s Simplicity – familiarity with the ingredients were supportive
o Health – health benefits of the ingredients
o Joy of drinking experience
 Growing consumer acceptance of the paper boat
 USP or POD – Made ethnic drink recipes which are on the brink of extinction are now
easily available to consumers
 Product mix – 10 variants of paper boat by 2015 end
 Needs fulfilled - Indulgence, thirst quenching, food accompaniment, regular consumption,
homogenized taste and people expectations with home-made centuries old recipes &
personal connection
 Satiated Thirst & Health Benefits
 Selling Point – Authenticity to convey health benefits
 Emotional benefit – reconnection with childhood + bringing simplicity in consumers
complicated life
 Brand Feeling – Déjà vu
 Brand Essence – Childhood innocence and memories
 Brand evoked pleasant nostalgic memories

 Brand Positioning – For Urban Indian youth in the age range of 25-40 years who are
confident enough to take on a demanding world, while remaining rooted in Indian Culture
 and traditions, Paper boat is the brand in non-carbonated Beverages Category that offers
feeling of reconnection with childhood with its long lost recipes of grandmothers. The brand
character is of Joy & innocence and creativity
 Unique Name – Paper Boat – strongly associated with joy, innocence and creativity

Company – Hector Beverages

 Founded in 2009 by Neeraj Kumar Kakkar, James Nuttall, Suhas Mishra & Neeraj Biyani
 Registered office - Gurgaon
 Strong presence in top 6 metro cities
 Products Launched
o Frissia – failed
o Tzinga – success in its target market – penetration pricing
o In 2013, launched Paper Boat – ethnic drink
 By 2015, Paper boat consisted 90% of the company’s total sales
 By 2015 end, 10% of sales of paper boat came from institutional clients
 By 2015, 50% of the paper boat sales were from southern metropolitan areas
 Two Plants – combined capacity of 10 million units a month
o Manesar
o Mysore
 Workers – 300
 By 2015, Valuation – 4 billion

Market

 In 2015 – Fruit based beverages market stood at 7 billion Rs and By 2016 – 12 Billion Rupees
expected
 Market growth rate – 45%
 India has 28 states and each state has its own food habits and specialties

Collaboration

 Rs. 300 Million funding by Venture Capitalists

 By 2015, total funding was 2.5 Billion Rupees

Competitors

 Unbranded Category
 Pepsico
 Coca Cola
 ITC

Consumer

Target Segment -

 Urban – lives in cities

 Typical Indian Youth – 25 to 40 age group
 Has nostalgic connection to home-made drinks
 Also targeted people who experiment with something for the sake of novelty

Cost
  Cost of packaging was 10% of MRP – still cheaper than tetra packs

Marketing Strategy
Pricing

 Prices were 3 times higher than unbranded products

o 250 ml – Rs. 30/-
o 1 Litre – Rs. 120/-

Distribution

 Started with Limited distribution

 Made available in 500 premium modern retails outlets
 Further increased the reach to institutional and retails outlets
 Premium office canteens, multiplex chains, coffee shop chains, and restaurants in upscale
hotels
 Products made available on Jet Airways & Indigo Airlines (To target middle and high class
opinion leaders)- Exclusive partnership
 In April 2015, 12000 retail outlets in 6 Metro cities
 Negligible presence in Tier 2 & Tier 3 Cities, hindrance to growth
 In April 2015, alliance with Indo Nissin Foods – access to 2 lakh retail outlets in 200 cities
(mostly tier 2 & 3)
 Opportunities
o Offer more trade margins
o Incentivize retailers by spending more
o Commercial contract with Indian Railways

Promotion

 Relied on word of mouth promotion

Dabur piggybacking on hajmola brand

Recommendations

 Launch more variants (but with deep research and testing market) - some should be year
long product and some should be seasonal temporary based on the climate and ambience -
winter
 reduce costs on packaging
 Give seasonal offerings and control its supply accordingly - especially for winters
 Heavy advertising - people should know that the brand exists while making a buying decision
 Expand in to different market - different country (long term)
 Incentivize retailers into selling your product when entering in new geographies
 when it was a niche market this communication strategy worked but with new players
coming and stealing market share - paper boat need to reach out to larger audience in a
tone familiar to them