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ITC's Engage range takes second spot in deo market by volume
The Economic Times - 15 Jul 2014

ITC Ltd has emerged the second  largest player in the domestic deodorant market within a year of entering the  business, overtaking deep-entrenched rival brands like Axe and Old Spice in the conglomerate's first major success in the personal-care space.

The sweet smell of  success for ITC with the Engage range highlights the trend of newer entrants gaining share in the Rs 2,300 crore Indian deodorant market by breaking away from the clutter of "man attracts women" communication theme.
 
ITC's Engage recorded  an 8.1% volume share in May across India's urban markets that account for 90% of the overall deodorant space, show data compiled by market tracker Nielsen India. Market leader Vini Cosmetics' Fogg held 12.5%, while Hindustan Unilever's Axe and little known McNROE Consumer Products' Wildstone were at the joint third spot with a 6.9% share each.

By value, Fogg is way  ahead, having 17.8% of the market. Wildstone had 6.7% and Engage 6.6%, followed  by Axe with a 6.5% share. In markets like Kolkata, Kanpur and Kochi, Engage was  the largest by both value and volume in May.
 
Engage is the fastest growing deodorant brand in the market, said ITC's chief  executive for personal-care business Sandeep Kaul. He refused to comment on the  market share.
 
"We have been able to break the clutter as far as advertisements for  deodorant is concerned," said Kaul. "Most brands portray deodorant as  a male phenomenon. Instead, Engage has focused on engagement and playful  chemistry between two partners who are equals, thereby lending credence to its positioning as a deodorant for couples."
 
The company covered almost 75% of the market within four months of the launch.  ITC's divisional chief executive (FMCG trade marketing and distribution),  Sanjiv Puri, said it managed this by leveraging its nationwide distribution infrastructure.
 
According to Nielsen, there are more than 500 deodorant brands in India trying  to woo the consumer. "Deodorant is also finding acceptance in the rural  markets which today accounts for 10% of the overall size and growing at  29%," said Executive Director Vijay Udasi. He declined to confirm  company-wise market  share data.
 
The deodorant market is growing at 17-18% year-over-year for the past three  years. While male deodorants contribute 69% to total sales, women's categories are driving the market with faster  growth. Deodorant is the largest category in the male grooming space.
 
The number of sub-brands and variants is 986 as of April 2014, with more than  100 new launches or re-launches over the past year, Nielsen's reports show.
 
For instance, ITC itself initially launched six variants of Engage and the  range has been scaled up to 14 variants in less than a year. The company plans  to roll out seven-eight variants every year, Kaul said. Emami, which last month  forayed into the segment, has six variants in the market.
 
The deodorant pecking order changed when Fogg overtook Axe as the market leader  last October, with the former promising more per bottle in its communication.  Emami and Park Avenue too have stayed away from the stereotypical campaign.
 
A Hindustan  Unilever spokesperson said the Indian deodorant market is in its growth phase with the  current level of low consumption offering big potential. "We are focussed  on building the deodorant market by driving penetration for Axe as well as building usage  of deos as a daily habit," he said.
 
Future Group CEO (Food Bazaar) Devendra Chawla said the deodorant category is  witnessing the maximum churn in pecking order. The market had almost become  commoditised with little price variation among brands, he said. But it is  "getting back pricing power due to differentiated launches by Wild Stone,  Engage and Fogg".
 
Emami Director Harsha V Agarwal said consumers have been shifting brand loyalty  in this category with a multitude of me-too brands. "Differentiated brands  are able to win in this market," he said, adding that the company is  aiming to be among the top five in two years.
 
Chawla said another new fragrance category - body spray - is emerging in the  market at affordable prices and can eat into the fast growth of deodorants.
 
ITC's Kaul said his company is looking at extending Engage to other areas in  the fragrance category. He, however, is keeping his cards close to his chest.

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