Industry Analysis: ALCOHOL INDUSTRY

Alcohol is one of the commonly consumed intoxicating substances in India. It has traditionally been drunk in tribal societies, although it has won increasing social acceptance among other groups, urban males being the prime example. It is easily available and widely used, especially at festivals. At the moment the use of alcohol is infrequent among women who also tend to resist the habit among male family members. Between 15 and 20 per cent of Indian people consume alcohol and, over the past twenty years, the number of drinkers has increased from one in 300 to one in 20. This translates into about five million people addicted to alcohol. Of what is actually consumed, the Intake of Indian Made Foreign Liquor (IMFL) is growing at the considerable rate of 15 per cent a year. Again, The Hindustan Times says that 65 per cent of the Indian liquor market is controlled by whiskey manufacturers. INDIAN LIQUOR BRANDS The varieties of alcohol manufactured for consumption in India are: 1. Beer 2. Country Liquor 3. Indian Made Foreign Liquor (IMFL) 4. Wines Indian alcohol brands showing an increase of as much as 50 per cent in sales (1993- 97). United Breweries registered an increase of nearly 20 per cent in sale in the year 1998-99. Indian Liquor Industry Branded spirits market in India is 119 million cases out of which Whisky accounts for 55%, Rum 27%, Brandi 14%, Gin 3%, and Vodka 1%. North and west India consumes more of whisky and South, more of Brandy and Rum. The UB Group (35%) has a market share of 35% + 13% = 48% after merger of Spirits Division of Shaw Wallace (13%), Jagajit (7%), Mohan Meakins (7%) and IDL (3.5%). The key MNCs operating in the India include Diageo, Seagram, and Bacardi. About 80% of whisky is sold at below Rs.200 per bottle and 1% above Rs.600.

ALCOHOL BRANDS AND THEIR ADVERTISEMENT INFLUENCNE: 1. BAGPIPER WHISKY 2. KINGFISHER BEER 3.

1. Bagpiper Whisky

Bagpiper Whisky is an Indian whisky made by United Breweries. Bagpiper was launched on 1976 Bagpiper whisky is the India's largest selling whisky in 2005 Bagpiper whisky is based on spirits that are distilled from fermented molasses Outside of India, such a drink would more likely be labeled a rum

Brand Ambassador: As alcohol advertisement is prohibited in India, United Breweries publicized

the brand name by their subordinate product Bagpiper club soda. Bagpiper has always tried to maintain their macho image with the brand ambassador they choose for their product. Their tagline Khup jamega rang jab mil baithenge teen yar, aap mai aur bagpiper club soda indicates the motive of the brand. Dharmendra, Shatrugan sinha were among the 1st of their ambassador. Their latest brand ambassador is Ajay Devgan and the product has also sponsored his latest movie Singham. Apart from them, Sunny Deol and Akshay Kumar were also among its brand ambassador.

Brand Loyalty: Bagpiper was the largest selling whisky in India in 2005, Indicates that customers are
pretty loyal to the brand. However, with the advent of other new variety in the market, the growth in consumption was not as significant in 2009-10

2. KINGFISHER BEER
United Beverages is leading alcohol producing company in Indian market. It comprises 48% share of the total alcohol market. Company established in 1857 by a Scottish person Thomas Leishman. Later in 1947 Vittal Mallya was elected as director of United Bewerages.

Based in Bangalore, is a conglomerate of different companies with a major focus on the brewery (beer) and alcoholic beverages industry. Recently UB financed a takeover of the spirits business of the rival Shaw-Wallace company giving it a majority share of India's spirits business. The group owns the Mendocino Brewing Company in the United States. The company sells the alcohol under two sectors : beer and united spirits Under the beer section the company sells 7 brands of kingfisher beer. Kingfisher Blue - Premium Beer Kingfisher Red

Kingfisher Strong - Strong Beer Kingfisher Premium - Mild Beer Kingfisher Ultra Kingfisher Draught

Advertisement : Due to limitations from government, in India it is forbidden to promote alcohol and cigarretes on any communication medium like TV, Radio, Poster. UB came up with innovative ideas to promote the beer and other alcohols in country. 1. Kingfisher Calendar Indians love their booze, but beer, it seems, leaves them cold. The country ranks tops globally in consumption of whisky, but it's somewhere near the bottom in beer drinking. Kingfisher hence came up with the idea of fashion calendar for the year for which beauty contest is organized sponsored by kingfisher. The event is famous in country and the calendar is one of the most awaited items of the year. Packaged Drinking Water Among the ads which were withdrawn, is United Breweries' Kingfisher Premium ad which showed a visual depiction of a dancing couple with "packaged drinking water" written in fine print. 2. IPL Team. Vijay Mallya owns Royal Challengers Banglore team in IPL. This is the publicity for the brands produced by the company. 3. F1 Team On international front company also sponsors F1 cars. Narayan Kartikeyan is the current drive for Ford is sponsored by Kingfisher. 4. Kingfisher food and night guide In cities like Mumbai, Banglore, Chennai, Hyderabad, Kolkatta, Pune kingfisher and Exocity has the great food guides which is actually restaurants and night clubs attracting youth.

3. CARLSBERG BEER
(By Kaushal Prabhudesai & Gaurav Mewati) The Carlsberg is a Danish brewing company founded in 1847 by J. C. Jacobsen after the name of his son Carl. The headquarters are in Copenhagen, Denmark. The company's main brand is Carlsberg Beer, but it also brews Tuborg as well as local beers. After merging with the brewery assets of Norwegian conglomerate Orkla ASA in January 2001, Carlsberg became the 5th largest brewery group in the world. In 2009 Carlsberg is the 4th largest brewery group in the world employing around 45,000 people The Carlsberg Group in India Carlsberg entered India in May 2006 by forming a company named South Asia Breweries Pvt. Ltd. by a joint venture between the Carlsberg Group and associated companies. The name changed to Carlsberg India Private Limited on 23rd February 2009 to reflect the company as a part of the Carlsberg Breweries. Carlsbergs commercial operations started in June 2007 by the commencement of production at the Poanta Sahib brewery, in Himachal Pradesh, with the launch of Carlsberg in the premium-beer segment and Palone in the strong-beer segment in some markets of North India. The very first sale took place on June 2nd 2007 with Palone in Himachal Pradesh. India is one of the fastest growing markets for the alcohol industry. As for the beer market, it has grown at 17% in the year 2010 and is forecasted to grow at 12 % CAGR going forward. The ambition of the company in India is to be the fastest growing beer company in India. Carlsberg India is the number 3 player in the market within 3 years of operation.

Brands Carlsberg Green, Carlsberg Elephant, Tuborg Green, Tuborg Strong , Palone 8 Positioning As part of the new positioning, Carlsberg has changed its tagline to 'That calls for a Carlsberg'; the packaging and logo have undergone changes, too. In the new packaging, the Carlsberg logo has been changed from horizontal to vertical, to create a bigger impact when placed on the shelf. Promoting Carlsberg has done promotion in India by being a part of IPL (Indian Premier League) sponsoring Kochi Tuskers and Kings XI Punjab.

Target Audience The new positioning has a revised and more specific target audience. Earlier, Carlsberg had a broad and relatively mature target audience. It will continue to target this group, and also expand its focus to include the younger generation of beer drinkers - the audience in the 28+ age bracket. The target audience is the social drinker who savors like-minded company and believes in getting the most out of life - somebody with an explorer's mindset, and someone who is willing to move out of his or her comfort zone to try something new.

4.Diageo
(By Ernestina Fernandes & Abhijit Singh) Diageo is a global alcoholic beverages company headquartered in London, United Kingdom. It is the world's largest producer of spirits and a major producer of beer and wine.Its brands include Smirnoff (the world's best-selling vodka), Johnnie Walker (the world's bestselling scotch whisky), Baileys (the world's best-selling liqueur) and Guinness (the world's bestselling stout).[6] It is also the exclusive international distributor of Jos Cuervo (the world's bestselling tequila). It sells its products in over 180 countries and has offices in 80 countries. [9][10]

Diageo in India
A growing economy, expanding middle class and rising disposableincomes have given the Indian spirits market significant growth potential. India is home to 17% of the global population (close to 1.1 billion). India is now the largest international whisky market by volume, reporting 810%growth annually. This makes India one among the fastest growing whisky markets anywhere in the world. Diageo is the worlds largest wine, beer and spirits company. It owns the brands like Smirnoff, Johnnie Walker, Guinness, Baileys, J&B, Captain Morgan, Jos Cuero and Tanqueray. Diageo launched its operations inIndia in early 1990s. But, the UK headquartered giant, yielded ground toFrench rival Pernod Ricard in the early round of India conquest. In the past 4-5 years, Diageo has taken a number of steps to revive itsmarketing strategies in the country. The biggest growth drivers for Diageoin India have been Johnnie Walker (Premium Scotch Segment) andSmirnoff (Premium Vodka Segment). In 2006, Diageo claimed to control80% and 90% of the two respective segments with these brands. Diageo spotted two major trends in India markets urbanization andpremiumisation (based upon the aspirational levels of the people). Thus,they created price segmentation. There was a big gap between the pricesof IMFL and premium alcohol. Haig was launched to target aspirants. So,there are different segments the takers for Haig, for existing brands likeBlack and White and VAT 69 and finally for Johnny Walker at the top-end.The aspirants eventually graduate to Johnny Walker. Similarly, in vodka,Shark Tooth which is mid-price, on a par with Fuel and Magic Momentsand Smirnoff which is slightly more premium and Smirnoff Black which isat the topend. So, here also three segments were created. Under itsSmirnoff brand, the company introduced an array of festive drinks withIndian ingredients like Smirnoff Masala Marke, Smirnoff Jaljeera, andSmirnoff Katha Pudina esp. to cater to Indian taste buds. In 2001, Diageo had hurriedly exited Indian-Made Foreign Liquor (IMFL) tofocus on its imported international portfolio but revised the strategy withthe domestic market witnessing sustained robust growth. In 2006, Diageoannounced a joint venture with homegrown liquor company RadicoKhaitan targeting the IMFL segment. Brands of Radico Khaitan include 8PM Whisky,

Contessa Rum, Old Admiral Brandy and Whytehall Whisky.Bollywood king Shahrukh Khan was roped in as the brand ambassador forits first offering Masterstroke deluxe whisky. In Sep, 2006 Diageo decided to launch the indigenously developed vodka brand called Shark Toothaiming to position it at prestigious vodka segment. In June, 2009 the TamilNadu government had cleared the decks for Diageo to start bottling in thestate, making it the first MNC drinks company to list brands in the localretail trade. The company had sold its most successful brand GilbeysGreen Label to the countrys largest spirits maker, UB Group, for Rs 60crore in 2001. Diageo is also bringing back the Gilbey's trademark to Indiathrough the Tamil Nadu foray. Sources said that Gilbey's is now beingreadied as a brandy flavour as the drinks giant works on leveraging itsbrand equity in South East Asian markets. The company entered into the Indian beer market with its globally top-selling premium stout beer brand Guinness.Diageo bought a strategicstake in Nasik-based Sula Vineyards.They entered the Indian Rummarket with their brand Captain Morgan. Despite the continuous efforts,the market share of Diageo in these other segments continues to be low. Roland Abella, managing director of Diageo India is clear that value, and not volumes, will drive Diageo India's growth, hence its focus on premiumproducts. It has reorganised its product basket and has exited the winebusiness in India. It has taken off its only wine brand Nilaya (pricedbetween Rs 395 and Rs 500) from the market so as to focus on its iconicbrands like Johnnie Walker Scotch whisky, Vat 69, Ciroc and Smirnoffvodka. Now, says Abella, ''For us, the centre of gravity is spirits. Diageolike other luxury retailers is betting on India's young demographic, risingconsumer standards and exposure to sophisticated products. Anotherreason for Abella's optimism is that premium brands are less vulnerable to the fluctuations of the global economy. Diageo has made significant noise in India during the past two years in abid to boost presence across trade channels for lifestyle drinks. InNovember, 2007 Diageo tied-up with retail giants Reliance Fresh andShoprite Hyper to distribute its wines portfolio in cities like Mumbai andPune. UB and Diageo initiated trade marketing activities with the alcobevchannel in early 2008. Diageo helped revamp local wine shops and re-branded them as JW Select outlets. From a push effect earlier, initiativeslike JW Select create the pull effect. Once the experience is created,offtake happens, said Santosh Kanekar, then marketing director, DiageoIndia. Clubs like Johnie Walker Club & Lounge, Smirnoff Cafes werelaunched as a part of the surrogate advertising. These clubs aimed atgiving the experience of drinks along with brand-associated music, artevents and Formula 1 races. Johnnie Walker Bartending Academy waslaunched aiming at introducing world-class standards of bartending.