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Saturday , 3 December 2016
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My name is Bahar , Pan Bahar

The newspaper on 7th of October was somewhat unusual and shocking for many when we saw one the most  classy,  debonair and lady killer actors of the bond series endorsing  Pan Bahar.

Now before we jump to any conclusion let us put in some efforts to understand the pan masala market in India which has an annual  market  of approx. 25 ,000 crores and the premium segment  constitutes approx. 2,500 crores . Rajnigandha is the market leader in this segment with approx. 80% of market share, followed by Pan Vilas and Pan Bahar. As per the Indian laws, it is illegal to advertise tobacco products  directly to consumers so advertising of pan masala is a  surrogate marketing for other tobacco products of the brand and is a major contributor to brand building. Popular actors have been endorsing pan masala brands since ages, be  it Shahrukh Khan endorsing Pan Vilas or Priyanka Chopra endorsing Rajnigandha. Fardeen Khan and Saif Ali Khan were the previous brand ambassadors of Pan Vilas but Pierce Brosnan is someone  way out of this league  and was totally unexpected.

The question which arises is that will this strategy work for the brand because an  overwhelming no. of consumers of  pan masala belong to the Bottom of the Pyramid and might not even know who is Pierce Brosnan and might confuse him with any other “GOORI CHAMDI”. The major strategies available with Pan Bahar were  -

1)Cost Leadership

2)Product Differentiation

3)Distribution Channel

4)Competitive Advertising

Cost leadership is very difficult to establish is an industry which is taxed heavily by the government and the product is sold mostly in small packs ranging from Rs 2-5. Customers buying  in biggers  packs are  loyal to their brands and are less sensitive to price. All the premium brands of pan masala have almost similar offerings so Pan Bahar is no different from rajanigandha in terms of composition. Distribution channels cannot be expanded overnight and the market leader, Rajnigandha already has a huge distribution network and the small pan-gutka shop owners do not have any significant reason to shift from current selling brands to Pan Bahar. Now competitive advertising seemed to be the only feasible strategy but this too  had its own difficulties. After the Maggie controversy and increasing efforts from the government in the form of negative marketing of tobacco  products, popular celebrities have become sensitive to their endorsements. So getting a mass puller like Amitabh , Salman or Aamir Khan would not have been  easy. Choosing Pierce Brosnan was a bold move by the company. The aim of advertising in this industry is to create a buzz and convert that buzz into increased sales. The bond actor has surely helped in achieving the first goal as a product like pan masala which is usually not talked about in social media or news channels  has received  free publicity from all these sources. Though most of it is in the form of trolling and making fun of the brand but even such publicity is good for a brand which was rarely talked about outside its core customers. Now how much of this publicity would actually convert to increase in sales is still a big question mark. The company hopes that all the buzz that has been created would ultimately reach to the core customers in  the product category  and maybe some  new customers would also try the product out of curiosity. Though no official source has confirmed the actual amount which has been paid to the bond actor but people estimate it to be  around $2 million (~13 cr). If this amount is justified or not can only be concretely answered by looking at the sales figures for the next quarter but the brand has surely caught everybody’s attention  and the very fact that an article is being written on it tells us about the reach of the advertising campaign.

By: Ashish Gulia

E: pm15ashishg@iimidr.ac.in

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