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Wednesday, December 9, 1998

JK Helene Curtis to rework pricing strategy for premium deo-sprays 

Namrata Singh  
Mumbai, Dec 8: J K Helene Curtis has decided to rework its pricing strategy for the premium range of deo-sprays, which were recently launched in competition with strong existing brands like Rexona and Pond's Magic.

The move follows the inability of the company to push the brand at the retail-end, where Hindustan Lever's (HLL) competitively-priced brands Rexona and Pond's dominate the scene.

Premium deo-sprays are priced at Rs 120 for 50 ml. As compared to this, Rexona deo-spray is priced at Rs 65 for 75 ml, while the maximum retail price (MRP) of Pond's Magic is Rs 72 for 75 ml.

Retailers said that since Rexona and Pond's deo-sprays are moving fast at the retail end with a higher brand recall considering HLL's strategic pricing policy, other expensive deo-sprays have little scope for sales pick-up. Preference has thus been given to the affordable range of products at the retail level.

The deo-sprays market in India, valued at Rs 70 crore, is growing at a healthy rate of 40 per cent per annum which isthe fastest growing as compared to the other FMCG categories like soaps and detergents which have slowed down considerably in terms of penetration. The deo-spray category is thus attracting a host of companies to launch their range of products. A number of such launches are due to take place in the coming few weeks, say industry observers.

According to sources, JK Helene Curtis, as part of its rethinking on the pricing policy, is seriously considering the direct marketing route to promote the brand by explicating on the consumer the premium quality of the product.

The main reason for the premium price of JK Helene Curtis deo-spray brand is the alcohol-based nature of the product. The excise duty on alcohol-based products is 50 per cent on the maximum retail price.

On the contrary, competing products Rexona and Pond's have a mix of powder-based and alcohol-based products. However, irrespective of whether it is powder-based or alcohol-based, HLL claims it has been able to keep a hold on its priceline.

JK Helene Curtis would either have to fall in line by changing its product mix or rework on the pricing front in order to push the brand, say industry observers. The company is though not keen on changing the product mix considering that the range was rolled out only a month back.

JK Helene Curtis, a Rs 48-crore company marketing premium brands like Park Avenue, Tru Tone and Premium, plans to touch a turnover of Rs 50 crore in 1998-99. The company is a part of the Rs 2,000-crore Raymond group.

Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.


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