Tata Salt, which contributes about 19 per cent to the total turnover of the mother company, Tata Chemicals, is aiming at a growth much higher than what it has achieved in the past three years. Expanding its communication from the emotional ‘Desh Ka Namak’ to going functional and proving the purity of the salt, the brand has changed its communication statement with its new advertisement.
Touted to be the biggest and the most important campaign by the brand in the last three years, Sagar Boke, Head, Marketing, Consumer Products Business, Tata Chemicals Limited, explained why the combination of functional and emotional communication was crucial. “While ‘Desh Ka Namak’ as a property has created a lot of emotional connect with the consumers, we also felt that there is enough scope for the brand to create reasons of purchase on the product level. We haven’t done away with the ‘Desh Ka Namak’ positioning, we have just expanded it to ‘Desh Ki Sehat, Desh Ka Namak.’”
The campaign has been conceptualised by Ogilvy & Mather India.
A recent entrant in the category, Patanjali, has been talking about purity for a very long time, across all its product verticals. When asked if the company is feeling the heat from competition, Boke said, “Talking from the point of view of this campaign, it is not reactionary. The campaign is not competition-centric, it is customer-centric. We are thinking about what is it in Tata Salt that we can educate the consumer about. The involvement and awareness level in salt category is low and we wanted to increase that.”
Boke also denied the notion that Patanjali was posing any sort of a threat to the brand.
Asked whether Patanjali is considered as a threat, he denied. “No. As a brand, we don't believe in countering someone. The trust that Tata Salt has garnered is much more than any competition.”
Boke stressed that ‘Desh Ka Namak’ will continue to be a strong lever for the brand. He is worried that the consumer awareness and involvement in the category is very low. “In fact, the biggest insight in the category is that ‘a salt is a salt’, the consumer doesn’t think much about buying a salt. Being the market leader, we wanted to talk about the functional attribute of the product which will then stand out. One of the challenges is how do you accelerate the conversation and penetration for the brand and while Desh ka Namak will connect the brand to the consumer, it might not be reason enough for the consumer to move from their current brand to Tata Salt.”
In a generic way of branding, it is often assumed that a brand ventures into the emotional and psychological conversations after reaching a stage of maturity in its lifetime. Tata Salt, on the other hand, has been a leader since its inception. The brand holds majority share in the category, which currently stands at 25.2 per cent in 2016-17 fiscal. If we consider the salt business of Tata Chemicals, which includes the brands Tata Salt and I-Shakti Salt, it commands a market share of 29.4 per cent in the overall powdered salt market.
So, why go functional and talk about product benefits after reaching this level of maturity? Boke defies the strictness of the sequential nature of branding. “The brand journey need not be sequential necessarily. A great brand always needs to have a combination of a good functional lever and an emotional connect. The journey for Tata Salt is going to have both,” added Boke.
The total revenue generated by the vacuum and iodised salt business of Tata Chemicals was Rs 1,236.46 crore in 2017 fiscal, up from Rs 1,174.84 crore of 2016 fiscal, as per the company’s annual reports.
While Tata Salt has been the leader in the category, Boke points to the cornerstones of building it into a brand that it is today. The mother brand ‘Tata’ is one of the most important pillars of building Tata Salt. The most trusted and valued brand in the country gives a lot of credibility to the brand Tata Salt. Another reason pointed out by Boke is the inception of the brand. In 1983, there was a great need to get rid of the iodine deficiency in the country. Goitre was spreading like wildfire and Tata Salt took it upon themselves to make iodised salt available to the masses. Tata Salt pioneered the iodisation of the salt and iodine deficiency today, has come down to almost zero. The third cornerstone for the brand is the product communication through ‘Desh Ka Namak’. The fourth pillar of this strong brand, according to Boke, is the unparalleled distribution network of 16.7 lakh retail outlets across India.
According to the financial report of the company, Tata Salt reaches 143 million households across the country annually. The total sales volumes for salt have grown by about 2.3 per cent from 2016 fiscal to 2017 fiscal, while Tata Salt grew by about 4.28 per cent during the same time.
“We have always been growing faster than the category, but this year, we are expecting a growth much higher than the last three years, especially catalysed by the new campaign,” said Boke.
Speaking about the growth plans he said, “The first avenue of growth is how you increase the penetration. One of the ways to look at it is that we have the scope to grab rest of the 74-75 per cent market share. So there’s a need to find ways to convince people to use better quality salt. The second avenue is to upgrade people from the basic Tata Salt Classic to the advanced variants.”
The company is hence, spending huge on promoting this positioning of ‘Desh Ki Sehat, Desh Ka Namak’. Boke puts it as an important strategic campaign for the company. “We are expecting a strong impact in the market, in terms of the buzz and awareness that it creates. The share of voice in the salt category during this campaign would be around 80 per cent.”
Tata Salt is a 35-year-old brand but it has launched variants that are priced higher and cater to a more health conscious consumers. Of all the variants, Tata Salt Lite grew by 10.65 per cent and achieved a sale volume of 19,619 tonnes in financial year 2016-17, says the company’s report. But the other variants –Tata Salt Plus, Tata Salt Crystal and rock salt–are still at miniscule percentages. Asked about the contribution of these variants, Boke said, “It is still majorly driven by Tata Salt Classic, which is a 35-year-old brand. All the other variants were launched in the last two to three years. We are seeing huge potential for the variants and have seen a significant jump, but Classic is contributing the most in the business. Tata Salt Lite is for hypertension, Tata Salt Plus for iron deficiency. Then there are Himalayan rock salt and Tata Salt Crystal (sea-salt).”
As mentioned in the annual report of the company, the estimated annual consumption of edible salt in India is six million tonnes and the demand is growing at the rate of 1.5 per cent. The company notes in the report, “The market continues to move towards a higher share of branded salt with the continuing awareness of better product quality, visible purity and iodine content. Specialty salts like rock salt and black salt have increased presence in modern format stores.”
While the company is aiming at a faster growth rate in the future, the category also has a certain set of challenges in marketing faced by the category. Salt is an essential commodity, but there are too many brands and to make marketing work, the companies keep trying to give their best. Boke points out three major marketing challenges, “We are a brand of a huge size. The first challenge is how to grow our consumer base from here on. It gets difficult after you reach this size. Second, is the consumer perception about salt, which has been negative for health. Salt is essential for the body for the electrolyte balance. Eliminating negative perception about the category is a challenge and the third aspect is to enhance distribution network to ensure that great quality product is transported at a minimum cost in the internal regions.”
Since taxes on salt did not change with GST implementation, the company had no impact. However, demonetisation had hit the business for about 15 days, but later it was resolved majorly because salt is an essential commodity for the household.
The total packaged salt market constitutes about 85 per cent of the total population. The rest of the population still consumes loose salt. The average expenditure on salt stands at Rs 8-10, against Rs 18 that Tata Salt Classic costs. Answering how difficult it is to convince a consumer to make this jump, Boke said, “If there is a value proposition, the consumer might be ready to migrate. Even if the gap between Rs 10 and 18 is looking huge, a household requires not more than one to two packets a month. So at that level, the increase in cost is not much.”