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Dabur Foods to relaunch Real fruit juice

Manjari Raman

It's back, after the squeeze. On September 15, the Rs 7-crore Dabur Foods, a Dabur India subsidiary, will be formally relaunching its complete range of Real fruit juices--just two years after the brand first made its foray into the fresh-juice market, and failed.

"My report-card so far? I'd probably give myself a C," says Dabur Foods director and CEO Amit Burman ruefully.

Instead, he is giving a shot of Vitamin C to Real. In place is a new packaging plan, a new positioning initiative, a new price rationale and even a new ad-shop (Equus Advertising), which is readying a Rs 5-crore campaign slated for early November. And this time, it's not the taste but the twist to the marketing strategy, which is new. Improved.

In contrast, the last two years were a Real shame. In June 1996, when Real debuted, the fresh-juice market seemed ripe for the plucking with only tinned juices like Noga and Druk, and fruit drinks (with less than 20 per cent pulp content) like Frooti and Jumpin', on the shelf. Real, with a pulpcontent of 85 per cent, was the first fresh juice in a carton--with no added preservatives, colour, or flavour.

Instead, Real was beaten to a pulp. In 1996-97, Dabur Foods posted a net loss of nearly a crore, on sales of Rs 2.5 crore. Worse, retailers were disgruntled with the distribution service. And consumers were confused by the taste variations caused by pulp-sourcing problems.

By April 1997, a new competitor--Onjus--was punching holes into the carton pricing. And in November 1997, Dabur had to recall Rs 50 lakh worth of spoiling stocks from retail outlets. By the end of 1997, its market share plummeted to just 3 per cent from 6 per cent in 1996. Says Jagdeep Kapoor, CMD, Samsika Marketing Consultants--marketing consultants to Enkay Texofoods' Onjus: "Dabur had the first-mover advantage--and squandered it."

Now Dabur Foods is determined to plug the leaks. Though break-even is still not in sight, the target for FY98 is ambitious: to double sales to Rs 15 crore in a total fruit-juice market estimatedat Rs 500 crore. Says Amit Burman, "You have to differentiate with regard to something and we are targeting price and packaging." Consider how Dabur is making some Real changes:

GETTING THE PRICE RIGHT:

In June 1996, Real was launched in three flavours, each in 500ml packs: Orange (Rs 27.50); Mango (Rs 30); and Pineapple (Rs 27.50). This was followed in August 1997 with Unsweetened Orange (Rs 30) and in October 1997, with Mixed Fruit (Rs 30) and Tomato (Rs 25), even as the price of the 500ml pack of Real Pineapple rose to Rs 30.

Then in April 1997, Enkay Texofoods declared war on the flagship, Real Orange, by launching Onjus in outflanking sizes (250 ml and 1-litre) and undercutting prices: against 500 ml of Real Orange at Rs 27.50, one litre of Onjus cost just Rs 35.

In the relaunch, Real is trying to wrest the price advantage. Recently, the price of Real Orange Sweetened, which constitutes 40-45 per cent of total sales, was reduced to Rs 22 for a 500ml carton and for one litre to just Rs42--a shade lower than Onjus' price of Rs 44 for one litre. Says Kapoor, who claims to have deliberately increased Onjus pricing in August 1998, "My perceived value has gone up and there is greater acceptance for Onjus. If Dabur tries to reverse its earlier pricing strategy it will backfire."

There is cause for concern. For while Real Orange prices have been brought down, the price of one-litre pack in other flavours remains high at Rs 55 even in the relaunch. Even within Orange juices, Dabur is setting itself up for confusion in the market-place: only the price of Real Orange Sweetened has been squeezed to undercut Onjus, while Real Orange Unsweetened still remains Rs 55 for one-litre.

Burman is not worried, though. Says he, "As other flavours gain critical mass, in terms of volumes, their price will also come down because we plan to pass down the bulk benefits to consumers."

Burman is using price as a strategic tool for streamlining the Real pool. As a first step, Dabur is slicing the market into anestimated Rs 100-crore in-home consumption segment (targeted through 500ml and one-litre packs with spouts) and a Rs 400-crore, out-of-home consumption segment (250 ml tetrapacks).

In the next few months, the entire Real range will be rationalised according to price, product and size, thus: