For a 162-year-old veteran, Glaxo's Eno is showing plenty of zing in its step. Now, a cola variant of the antacid hits the stores.
Consumer products giant Glaxo SmithKline Consumer Healthcare (GSKCH) appears to have a bee in its bonnet about colas. Its flagship beverage brand Horlicks already outsells both Pepsico's Pepsi and Coca Cola's Coke brands in India. And now, it wants to take a further bite of the fizzy drinks market with a cola-flavoured beverage of its own.
GSK's latest offering (like all its beverages, it is actually a powder — GSK believes in leaving the business of adding a liquid in the hands of its consumers) gets you a typical, dark brown fizzy drink. It looks like a cola. It even tastes like a cola. But it isn't a cola at all.
Technically, it's classified as an ‘ayurvedic proprietary medicine' in India, as ayurvedic proprietary medicines get a nice tax break.
Globally, in the 34-plus markets that it is sold in, it is classified as an ‘over the counter' (OTC), or non-prescription antacid.
Sold for over a century-and-a-half on a single brand premise — “fast relief” from symptoms of heartburn and bloating — Eno Fruit Salt is an anachronism of sorts amidst the modern-day clutter of niche products and micro-segmented brands.
For most of its existence, Eno was sold in just a single variant — fruit-based flavours were introduced only in 1998 — with very limited variation even in packaging.
But lack of variety hasn't hampered its growth. Today, it is one of GSKCH's biggest money spinners.
No heartburn for GSK
For a 162-year-old veteran, Eno is showing plenty of zing in its step. The brand clocked sales of £35 million (over Rs 301 crore) last year. This works out to close to 11 per cent of GSKCH's Rs 2,770 crore turnover logged in 2011 (calendar year).
This may not seem like much, but is pretty impressive, considering Eno's in-house rival is Horlicks, GSKCH's megabrand and the largest selling beverage brand in India.
The quantities make India the focal market as far as the UK-based pharma and foods giant is concerned. “India is the number one market worldwide for Eno,” says Jayant Singh, who moved from detergent maker Henkel India to GSKCH's Gurgaon headquarters last year as Marketing Director.
GSKCH claims Eno is the market leader in India. Which is simple, as it is virtually in a category by itself — although pharma majors like Ranbaxy have been trying to push effervescent tablets such as Pepfiz in the same category.
But the Rs 750-crore-plus Indian branded antacid market is broadly split three ways between Eno, Dabur's Pudin Hara and liquids such as Digene and Gelusil, which together account for 90 per cent of the market. “We have a 35 per cent market share,” says Singh firmly.
But expanding that is not enough to provide the kind of growth the company is looking for. GSK, like many other consumer product companies, has been attempting to diversify its offerings, as rising input costs and growing competition put the squeeze on margins. After growing its top line at 20 per cent over three years till 2010, growth slowed last year to around 16 per cent.
In the meantime, there was a flurry of activity in GSK's brand portfolio. It expanded the Horlicks brand into instant noodles, doubled the number of variants in Horlicks and chocolate drink Boost, expanded its biscuits portfolio and even took a stab at India's Rs 150-crore energy drinks market with Lucozade Sport.
But Eno has managed to hold its own within this bewildering portfolio, clocking a steady, double-digit growth year after year.
“It's essentially because we have a very clear brand proposition. We not only promise fast relief — we have documented it and measured it.
The brand promises that it will ‘work in 6 seconds' — and it does,” says Singh. Despite its long history and familiarity, though, there are some inherent limitations. GSKCH's key problem is expanding the addressable audience. While the product has a die-hard fan following, it is consumed largely by men, that too, older men (at least old enough to have developed acidity).
Which leaves out half the country — women. “Not at all,” demurs Singh. “Eno is consumed by many women.” It is actually bought by a number of women, but not as an antacid. Since it is essentially a mixture of sodium bi-carbonate and sodium carbonate, it is used in the kitchen for everything from making dhoklas spongier to biscuits crisper and naans fluffier. “It's an unexpected benefit,” laughs Singh.
But the real impediment to maintaining this hectic rate of growth is India's changing demographic. When half the population is under the age of 20, pitching antacids at youthfully vigorous digestions becomes a tad difficult.
That's probably why its advertising has swung more towards a younger target audience.
While the largest selling variant uses Boman Irani as a turbaned Sikh quickly tackling his feasting-induced acidity before rejoining the festivities at a typical Punjabi wedding, the other fruit flavours such as lemon and mosambi feature animated cartoons, while the new cola variant features a young man at a typical Indian matrimonial “girl seeing” get-together. “We would like to talk to a younger audience,” admits Singh.
For the moment, though, the future appears pretty rosy for the brand. As long as Indians do not give up their love of spicy food, or their cycle of feasting and fasting, it is on a good wicket. And with an estimated 77 per cent of acidity sufferers saying they prefer to medicate themselves, they are likely to keep reaching for a packet of fizzy relief.