Consumer goods giants Hindustan Unilever, GlaxosmithKline, Colgate-Palmolive wage big-bang advertisement war
Welcome back to the world of marketing wars and aggressive competitive advertising in the consumer goods market. After a lull of almost two years, high-decibel ad campaigns have made a comeback.
NEW DELHI,MUMBAI,KOLKATA: On February 18, when British PM David Cameron visited the headquarters of Hindustan Unilever BSE 1.22 %, the firm's legal cell was busy finalising the documents for dragging the Indian unit of the UK's Reckitt Benckiser to court over disparaging comparative advertising. Not that this came as a shock to the maker of Dettol and Harpic. The company's top management had instructed its team to 'go for the kill' with its Dettol Kitchen dish-washing liquid ad campaign, despite knowing its ads could land in court.
Less than 10 days ago, GlaxosmithKline Consumer Healthcare BSE -0.60 % announced the launch of Parodontax toothpaste, its global brand, targeted at customers with bleeding gums. The response of Colgate-Palmolive BSE -0.07 %, the oral care market leader was swift and emphatic. Two days ago, it began advertising its own variant through full-page ads, claiming its product was the best.
Welcome back to the world of marketing wars and aggressive competitive advertising in the consumer goods market. After a lull of almost two years, high-decibel ad campaigns have made a comeback across categories ranging from toothpastes and biscuits to dishwashers and mobile phones. Consumer demand may still be subdued, but companies are hiking ad spends in the hope of stepping up consumption, garnering market share, and creating a buzz around their products.
Sam Balsara, chairman and MD of Madison, which buys media for tobacco-to-biscuits major ITC BSE 1.69 % and telecom services provider Bharti Airtel BSE 2.87 %, said there is increasing realisation among companies that they can't take growth for granted in a cautious economic environment and with more brands entering the market. "We see an escalation of ad spends, especially among consumer companies, this year," he said.
But do high-voltage ad campaigns work? "The cola wars of the 1990s did not help either Coca-Cola or Pepsi. What they did was create excitement in the category," said Santosh Desai, CEO of Future Brands. "While different brands would have different reasons to come up with competitive advertising, what it does is create either new categories as in the case of specialist oralcare or smartphones, or create excitement in existing ones as in the case of biscuits."
Newer categories like smartphones are being particularly aggressive. Last month, Apple kicked off an ad blitzkrieg on EMI schemes for the iPhone 5. Samsung, the smartphone category leader, responded by launching a big-bang print ad campaign that announced the revival of its EMI schemes for six premium Galaxy phones. Sony has roped in Katrina Kaiff or two years to promote its Xperia smartphones and decided to triple its marketing budget for smartphones to Rs 300 crore for next fiscal. “The smartphone war will further heat up. Z10 will give a tough fight to competitors and will help us gain consumer franchisee and share that may have been lost to Apple or Samsung," says BlackBerry India MD Sunil Dutt. Blackberry launched the Z10 smartphone in India on Monday.
India is an underpenetrated and underserved market where advertising has traditionally been directed at consumers and not competition. But this is gradually changing. Reckitt Benckiser's Dettol Kitchen dish-washing liquid ad showed Vim up front and disparaged the HULBSE 1.22 % product. HUL has hit back with full-page ads saying 'antiseptic is for cleaning floors and wounds, not utensils', a thinly disguised attack on Dettol.