August 2013, Hector Beverages forayed into the Indian juices and beverage market, dominated largely by MNC’s Coke and Pepsi, but with difference. It introduced two common irresistible Indian flavors ~ Aamras and Jaljeera, under the brand name of Paper Boat. From a starry-eyed start up, Hector beverages has gained lots of fans and market. By clever dip into childhood memories of most average Indians, positioning itself as a health alternative, Paper Boat as captured the young and young-has been alike. How did they achieve this?
For a start, the brand name is unique and easy to remember. The name evokes the nostalgic days when one cajoled paper boats to sail through the rivulets or rain pods, with the feet kissing the wet earth and head covered by nothing more than a piece of cloth. The name ‘Paper Boat’ automatically recalls Childhood memories that subconsciously lead the customer to a ‘happier place’ or a ‘happier time’. Even though the brand name does not synch with the product category or the beverages industry, Paper Boat manages to create a Pleasant Experience with its unique combination of ‘Drinks and Memories’.
Second the product itself. As most of the ingredients are naturally available spices and condiments. It helps differentiate itself from the crowded aerated soft drinks with loads of sugar. By going to back to “desi” roots and sticking onto natural bandwagon, Paper boat could very effectively play the health card. As the products can be used as starter drinks or post-meal digestives, “time of the day” were not a challenge. The flavors one sweet and other slat helped it to reach out to diabetic capital of the world and others at same time. Contrasting flavors found the plate of people with various palates. By keeping the taste closer to mom’s recipe the product endeared itself to ipad and no-pad generations.
Packaging also played an important role in accelerating sales of Paper Boat. With a unique and extremely appealing Packaging with sophisticated ‘matt finish’, the pack had a dignified and yet interesting look. The dynamically vibrant colors, cute doodles at the bottom and the Call out at the back recreates the Magic moments associated with every flavor of the drink served.
Most traditional drinks have bitten dust not because they got their milieu wrong, but the pricing. In a market dominated by Big sumo’s capable of quashing out competition through cheap product supported by heavy marketing and distribution, Paper boat got two things right. Its pricing of less than 50 cents (US) for a 250ml, and $2 for 1000ml, Hector beverages has cleverly positioned Paper Boat as a high quality and healthy beverage by setting competitive pricing.
Paper boat adopted a new style when it comes to distribution. It not only got shelf space for itself in local kirana stores to push the product into the market but also was willing to go that extra mile, well in this case a thousand miles perhaps. Yes, Paper Boats were served at around 10000 feet above sea level to the IndiGo Airline Passengers. Paper Boat also realized the need to as an aspirational brand and present in aspirational platforms like Coffee Shops like Barista and Star hotels like Trident etc.
For a company short on dollars, Hector beverages, cleverly used facebook posts to drive the product. With theme around bringing back childhood memories, connecting Paper Boat was easy. As bloggers and reviewers relived their first experiences of the two flavors with Paper Boats, taste buds were on fire and word of mouth raging.
It is a great story so far for a one year old. What lies ahead for Hector beverages?. What next steps? To address these questions, I looked at similar upstarts in other markets. While there are many examples of traditional beers (most recent being Utah based beer brands taking on Budweiser), Adam Pritchard “Pomegreat” serves as a good example, what happens to a health brand that spread itself thin. Launched in 2004, it managed to get shelf space in Sainsbury and that is when the sales kicked off. It quickly moved from a £600,000 turnover company in 2005, to £15m in 2007. But the economic turndown in 2009 affected the company’s sourcing and revenue was reduced by over 20%. Recently acquired by Simple Great Drinks Company it is being rebranded as Simply Great.
The best Hector beverages must do is to imitate, a very successful brand in beverage market. Red Bull has built itself as a beverage brand by being frugal and focusing on functionality. With no significant investment in mass-marketing campaigns and endorsements, Red Bull marketing is largely community and WOM led. It carefully build customers for life, by allowing them to creatively interact with the brand, build their own “wings”. With no major investment in print media, banners or bill boards, promotions are amusement oriented. Its branding is deliberately “underground”, so that it can appeal to young people. One size and one packaging has done wonders for Red Bull. Paper boat can become Beverage Partners for Events like Marathons or Run For a Cause etc. or even sport tournaments like IPL or the Kabaddi League.
To be successful and go international, Hector must also do some things Red Bull has not done. Since the Jaljeeras and Amras are all “utility” drinks, unlike Red Bull, Hector must focus on campaigns to reach out to convenience stores, Modern trade outlets (petrol stations, Pizza chains, Food courts at SEZs and IT Parks), Goli Vada pav (and other complementing players). Product expansion into several “limbo”, “aam”, “seethapal” extensions is a must. Of the $6 Billion Indian soft drink industry (fuzzy drinks, juices, packaged water, 660 million cases by volume, packaged juices is just about 87 million cases. Of the remaining million cases, lemon segment is about 50%. Hector can use its increasing fan base to its benefits and come up with crowd sourcing ideas where they can set up an online social media campaign of people sharing their ideas and thoughts for Paper Boat. They must pursue “What’s your paper Boat story?” or “Introduce us to a long lost Indian flavour” strategy.
Hector beverage can also play a strategy that is more by accident than design. Paper Boats have found themselves into the shelves and kitchens of restaurants to be used for making Mocktails. Paper Boat Golgappe Mojto and Jaljeera Ice Tea are served in many restaurants. Can Hector exploit partners to increase revenue, popularity and visibility if the drinks are named after PaperBoat, just like McDonald’s Oreo Shake. That is worth pursuing.
Sai Gopika Ranganathan
Junior Consultant – Marketing