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ITC soaps up premium segment for growth
The Hindu Business Line - 28 Nov 2013

Going  premium in times of a slowdown in a saturated category like soap seems to have  worked for ITC. The company made a relatively late entry into the soaps  category in 2008, but it is the premium soaps portfolio which is growing faster  than the mass offerings in its personal care portfolio.

SandeepKaul,  Chief Executive, Personal Care Products, ITC, said, “Today, our premium brand  of Fiama Di Wills gel bars is the fastest growing brand in portfolio while mass  brands such as Vivel and Superia continue to be the largest selling. Our belief  is that there has to be design and product development during times of a  slowdown backed by the right technology.” Scientists at ITC’s innovation centre  have been working towards creating products which are different from the  regular offerings in penetrated categories like soaps. Considering the slowdown  in GDP growth has hit the FMCG category as well, premium brands seem to have  benefited more than the mass offerings in ITC’s portfolio.

“Slow  GDP growth has affected the FMCG industry. However, it has been the best year  for Fiama Di Wills gel bathing bars. Getting bath gel in the form of soap bar  has worked and this has been a clear differentiator in the almost 100-year-old  soaps category,” added Kaul.

Industry  observers also say that the premium end of the FMCG category has been  relatively less impacted. VikasDaga , Partner McKinsey & Company, said,  “While for most premium brands there is scope for growth, in the case of ITC,  it is about having a differentiated value proposition which has worked for them  in competitive categories like soaps.”

Moreover,  for most premium brands the gap between spends and earnings is not that much,  making it a better proposition during times of a slowdown when spends on any  brand are being slashed.

Targeted  advertising by ITC has helped its brands. “We believe in having dialogue with  the consumers instead of having one way marketing with them. In such cases it  is dialogue through the digital media and social media which has helped us in  creating brands,” he said.

“ITC  is planning a quantum jump in volumes and image of its soaps portfolio. It is  catering to the aspirations of Indian consumer. Despite being present just a  couple of years in the FMCG business, it is giving stiff competition of some of  the big FMCG players,” said Jagdeep Kapoor, MD, Samsika Marketing Consultants.

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