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Wednesday, May 08, 2002

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Nestle takes on P&G's Vicks with Acti-V

Ratna Bhushan
Sankar Radhakrishnan


PROCTER & Gamble Hygiene & Healthcare Ltd's Vicks, an erstwhile dominant FMCG brand, but battling stiff competition and the onslaught of counterfeits in recent times, has more bad news coming its way. Foods major Nestle India Ltd is pitting its latest launch — a throat lozenge branded Acti-V — directly against P&G's Vicks cough drops.

As reported by Business Line last March, Acti-V with anticol is an ayurvedic proprietary medicine and has been positioned as an `anytime, anywhere' throat soother. According to the company, Acti-V is the first throat soother with anticol — a liquid centre with a combination of herbal ingredients and extracts of menthol, eucalyptus, saunf, ginger and camphor. The brand has been introduced in two variants — honey lemon and menthol eucalyptus.

Commenting on Nestle India's decision to foray into the throat lozenges market, Chairman & Managing Director, Mr Carlo M. Donati, said, "Nestle is focused on providing nutrition and wellness to consumers in their daily activities and will continuously innovate and renovate products that deliver these values. The anticol in Acti-V provides a double action effect to help consumers feel good and active.'' Acti-V has been rolled out in all the Southern states.

The category being very price-sensitive, Acti-V has been introduced at the same price as Vicks lozenges — Re 1 per sachet. However, Acti-V is almost 66 per cent bigger in size (4 gm against Vicks lozenges' 2.4 g), Nestle India's spokesperson said. Acti-V is being manufactured by Makson Pharmaceuticals in Gujarat.

The throat lozenges segment, though currently a minuscule segment of the Rs 1,300-crore organised confectionery market, is fiercely competitive. Besides P&G's Vicks, other prominent brands in the cough lozenges segment are Halls and Strepsils.

According to industry data, the domestic confectionery industry is largely fragmented and has seven major categories — hard boiled candies (HBC), toffees, eclairs, chewing gum, bubble gum, mints and lozenges. While HBCs form 51 per cent of the market, toffees and chewing gum account for 18 per cent each of the confectionery market. Eclairs follow with a 5 per cent share, followed by mints and lozenges at 4 per cent each.

Nestle's decision to tap the throat lozenges segment is probably buoyed by its performance in chocolates and confectionery last year, FMCG analysts said. Over the past one year, the company has introduced smaller pack sizes for all its chocolate brands including KitKat and Bar-One. Other confectionery brands in Nestle's basket include Milkybar Choo, Chocostick, Polo and Fruitips.

The company's first quarter results, announced last week, showed a 55 per cent growth in net profit compared to the previous year. Nestle India clocked a 17.4 per cent growth in its sales revenues, at Rs 530 crore, for the period ended March 31, 2002.

The launch of Acti-V follows the introduction of Maggi Chinese Noodles, Maggi Imli Sauce, Fruitips Pastilles, Nescafe Redimix, Kream-O-Cook, MaxiMunch and Dairy Mate in recent months.

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Nestle takes on P&G's Vicks with Acti-V

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