How Ramazan’s blessings flow for the beverage industry
Ramazan is actually a month of blessing for beverage makers in Pakistan as sales for their products tend to skyrocket.
Ramazan is actually a month of blessing for beverage makers in Pakistan as sales for their products tend to skyrocket. Obviously, manufacturers take advantage of the possibility of increased sales in the month and plan marketing activities accordingly.
A customer can choose between the more traditional sugary drinks like Rooh Afza or the more flavour-enticing powdered drinks which include options like orange, mango, lemon and pineapple among many others.
Moreover, although the more popular soft drinks are in no way ‘seasonal’, they seem to have a renewed appeal during Ramazan and sales go up noticeably. Executives of renowned soft drink companies share that they come up with special offers and catchy advertisements to maintain hold over the market.
Ramazan is one of the highest-selling seasons for Coca Cola in Pakistan, for example and the company compares the sales witnessed during the month to those recorded in summer months.
Executives highlighted that in the absence of such marketing activities the threat of the more traditional drinks taking over would be much higher in Ramazan.
Some firms also said that they spend a considerable amount on advertising in Ramazan. It is estimated that millions of rupees are spent by the beverage industry alone on advertising campaigns for the month.
The separate marketing budget for Ramazan highlights the significance of the season not just for beverage makers but other industries as well.
Although different companies gave their own versions of the increase in sales during Ramazan, it is estimated that on average about 30 per cent of their annual sales are made during the month.
Increased competition
It comes as no surprise that along with increases in demand, the Ramazan period has become increasingly competitive for companies which have resorted to constantly introducing new products in order to entice the price and quality-conscious consumer.
“To create some excitement, this time we introduced Tang Rose,” said Hammad Danish, senior brand manager at Clover Pakistan, the company responsible for making Tang in Pakistan. The new flavour is quite different from the brand’s widely acclaimed flavours which include orange, mango and grape.
Many local and multinational companies are finding it tough to increase market share because of the increased number of options available to consumers. This has resulted in fierce competition in the fruit juices, pulps and powdered drinks category.
At present, there are only three to four established names competing in the powdered drink category while between 15 and 20 companies are contending to maximise market share in the ready-to-drink juices segment.
National Foods and Engro Foods are two mammoths which have decided to enter the juice market, making it clear that the competition is not going to diminish but rather grow stronger in the months to come.
And of course, one cannot forget popular carton juices like Nestle, Shezan, Ol fruit, Frooto and Slice which have high sales all year round but still witness a jump in Ramazan.
Although companies have welcomed new entrants into the drinks market, the underlying fear is evident amongst managers as the struggle for market share is heating up.
Ready-to-drink beverages ousting powdered drinks
Price consciousness, ease of use behind change
The first two weeks provide the greatest opportunity to boost sales, according to Hammad Danish, senior brand manager of Tang at Clover Pakistan Limited. “For us the first half of Ramazan is more important as people generally buy more Tang jars in this period compared with the second half of the month,” he said.
Like other companies, Tang also increases its advertisements in Ramazan. When asked about Tang’s market share, Danish said that unofficial reports suggest that the brand holds between 45 and 50 per cent of the powdered drinks market in Pakistan.
Clover executives also believe that price consciousness among consumers is on the rise and companies are struggling to offer quality products at affordable rates.
The recent progress of large multinationals in the ready-to-drink juices segment, especially fruit juices, has caught the attention of established ‘made-to-drink’ companies.
Companies are also worried about a possible decline in sales following the catastrophic floods. They fear that disruption in their distribution system may affect quarterly sales.
Powdered drink officials also claim that soft drink companies have introduced different retail volume units in the past few months and as a result, have succeeded in maintaining sales.
They argue that the approach to launch bottles of different sizes underlines the cutthroat competition to retain customers while also generating some hype.
Some of the powdered drink companies have also introduced sachet packets. This is a popular marketing tactic in the developing world where customers with low purchasing power hold a large market share.
Ramazan, summer sales similar
Ramazan is one of the best selling periods for us, said Fahad Qadir, manager of public affairs and communications for Pakistan and Afghanistan at the Coca Cola Export Corporation.
In Ramazan, sales are generally quite high and similar in number to the summer season since social gatherings increase in Ramazan, he pointed out.
Even though he agreed that carbonated drinks are in direct competition with juices and other drinks, he added that the categories are indeed quite different. “Within the carbonated drinks category, we witness intense competition during Ramazan characterised by marketing stunts such as price discounts,” said Qadir.
Coca Cola’s Ramazan campaign this year was a success, according to Qadir. The company is also ready to compete in the juice market with local competitors through its signature pulp category brand, Minute Maid.
Leadership claims are rife but Rooh Afza stands undisputed
Rooh Afza, the traditional beverage popularly known as the ‘lal sharbat’, enjoys a considerable share in Ramazan’s beverage market. Not only does the brand enjoy ‘unmatchable customer image and brand equity’ in Pakistan, it is well established in India as well, according to industry sources.
“Our sales get a real boost in Ramazan,” shared an official at Hamdard Industries Private Limited, Rooh Afza’s parent company.
“Ramazan for us is a two-month long activity,” the official added. “Wholesalers and retailers start stocking a month before the first fast. Consumers also start purchasing bottles a week before Ramazan starts,” he explained.
“Sales in the holy month constitute about 30 per cent of our annual sales,” revealed the official.
Claims of market leadership are rife in the market but Rooh Afza’s brand equity far outweighs its competitors like Naurus and Jam-e-Shireen, claimed the official.
New entrants like Rave and Shan-e-Mashriq are yet to capture a significant market share but the sheer number of new product launches alludes to the growth of this industry in Pakistan.
Published in The Express Tribune, September 8th, 2010.
A customer can choose between the more traditional sugary drinks like Rooh Afza or the more flavour-enticing powdered drinks which include options like orange, mango, lemon and pineapple among many others.
Moreover, although the more popular soft drinks are in no way ‘seasonal’, they seem to have a renewed appeal during Ramazan and sales go up noticeably. Executives of renowned soft drink companies share that they come up with special offers and catchy advertisements to maintain hold over the market.
Ramazan is one of the highest-selling seasons for Coca Cola in Pakistan, for example and the company compares the sales witnessed during the month to those recorded in summer months.
Executives highlighted that in the absence of such marketing activities the threat of the more traditional drinks taking over would be much higher in Ramazan.
Some firms also said that they spend a considerable amount on advertising in Ramazan. It is estimated that millions of rupees are spent by the beverage industry alone on advertising campaigns for the month.
The separate marketing budget for Ramazan highlights the significance of the season not just for beverage makers but other industries as well.
Although different companies gave their own versions of the increase in sales during Ramazan, it is estimated that on average about 30 per cent of their annual sales are made during the month.
Increased competition
It comes as no surprise that along with increases in demand, the Ramazan period has become increasingly competitive for companies which have resorted to constantly introducing new products in order to entice the price and quality-conscious consumer.
“To create some excitement, this time we introduced Tang Rose,” said Hammad Danish, senior brand manager at Clover Pakistan, the company responsible for making Tang in Pakistan. The new flavour is quite different from the brand’s widely acclaimed flavours which include orange, mango and grape.
Many local and multinational companies are finding it tough to increase market share because of the increased number of options available to consumers. This has resulted in fierce competition in the fruit juices, pulps and powdered drinks category.
At present, there are only three to four established names competing in the powdered drink category while between 15 and 20 companies are contending to maximise market share in the ready-to-drink juices segment.
National Foods and Engro Foods are two mammoths which have decided to enter the juice market, making it clear that the competition is not going to diminish but rather grow stronger in the months to come.
And of course, one cannot forget popular carton juices like Nestle, Shezan, Ol fruit, Frooto and Slice which have high sales all year round but still witness a jump in Ramazan.
Although companies have welcomed new entrants into the drinks market, the underlying fear is evident amongst managers as the struggle for market share is heating up.
Ready-to-drink beverages ousting powdered drinks
Price consciousness, ease of use behind change
The first two weeks provide the greatest opportunity to boost sales, according to Hammad Danish, senior brand manager of Tang at Clover Pakistan Limited. “For us the first half of Ramazan is more important as people generally buy more Tang jars in this period compared with the second half of the month,” he said.
Like other companies, Tang also increases its advertisements in Ramazan. When asked about Tang’s market share, Danish said that unofficial reports suggest that the brand holds between 45 and 50 per cent of the powdered drinks market in Pakistan.
Clover executives also believe that price consciousness among consumers is on the rise and companies are struggling to offer quality products at affordable rates.
The recent progress of large multinationals in the ready-to-drink juices segment, especially fruit juices, has caught the attention of established ‘made-to-drink’ companies.
Companies are also worried about a possible decline in sales following the catastrophic floods. They fear that disruption in their distribution system may affect quarterly sales.
Powdered drink officials also claim that soft drink companies have introduced different retail volume units in the past few months and as a result, have succeeded in maintaining sales.
They argue that the approach to launch bottles of different sizes underlines the cutthroat competition to retain customers while also generating some hype.
Some of the powdered drink companies have also introduced sachet packets. This is a popular marketing tactic in the developing world where customers with low purchasing power hold a large market share.
Ramazan, summer sales similar
Ramazan is one of the best selling periods for us, said Fahad Qadir, manager of public affairs and communications for Pakistan and Afghanistan at the Coca Cola Export Corporation.
In Ramazan, sales are generally quite high and similar in number to the summer season since social gatherings increase in Ramazan, he pointed out.
Even though he agreed that carbonated drinks are in direct competition with juices and other drinks, he added that the categories are indeed quite different. “Within the carbonated drinks category, we witness intense competition during Ramazan characterised by marketing stunts such as price discounts,” said Qadir.
Coca Cola’s Ramazan campaign this year was a success, according to Qadir. The company is also ready to compete in the juice market with local competitors through its signature pulp category brand, Minute Maid.
Leadership claims are rife but Rooh Afza stands undisputed
Rooh Afza, the traditional beverage popularly known as the ‘lal sharbat’, enjoys a considerable share in Ramazan’s beverage market. Not only does the brand enjoy ‘unmatchable customer image and brand equity’ in Pakistan, it is well established in India as well, according to industry sources.
“Our sales get a real boost in Ramazan,” shared an official at Hamdard Industries Private Limited, Rooh Afza’s parent company.
“Ramazan for us is a two-month long activity,” the official added. “Wholesalers and retailers start stocking a month before the first fast. Consumers also start purchasing bottles a week before Ramazan starts,” he explained.
“Sales in the holy month constitute about 30 per cent of our annual sales,” revealed the official.
Claims of market leadership are rife in the market but Rooh Afza’s brand equity far outweighs its competitors like Naurus and Jam-e-Shireen, claimed the official.
New entrants like Rave and Shan-e-Mashriq are yet to capture a significant market share but the sheer number of new product launches alludes to the growth of this industry in Pakistan.
Published in The Express Tribune, September 8th, 2010.